Hybrid and Electric Running Costs
If you're thinking about making the switch, you may be wondering what the running costs are of electric and hybrid vehicles.
How much does it cost to run an Electric or Hybrid Car?
Whether you’re eyeing up the Audi e-tron range or Volkswagen electric cars with both style and power, you may be wondering what the running costs are of electric and hybrid vehicles. Here at Swansway Group, we offer a wide range of zero and low emissions vehicles and are here to break down the costs for you.
There are are few key things to consider when running an Electric or Hybrid Car:
- Running Costs
- Vehicle Tax
- Servicing, Maintenance & MOT
- Insurance
- Recharging Costs
Running Costs
Though EVs do command a higher price tag from the offset, the costs of running them are much lower than those associated with a petrol or diesel car. DirectLine’s research found that the average annual cost for running an electric car is 21% cheaper than keeping a petrol or diesel car going over a year, working out at around £107 cheaper annually.
EV owners have access to free parking spaces around the country, as well as free charging stations in many car parks and supermarkets. For those travelling in London, EVs are exempt from the daily congestion charge.
Service and Maintenance
As electric vehicles have fewer parts to maintain they generally cost less to keep in tip-top condition. They also don’t need oil filters and have no cambelts that can be fairly expensive for a vehicle owner to replace. That said, they’ll still require an MOT once a year after they turn three.
Recharging costs
Firstly, it’s good to know that electric vehicles are considered much cheaper to run than diesel or petrol vehicles, and it’s fuelling your car with electricity where you’ll really save money. In fact, it’s thought electric vehicles can travel up to three times the distance of their fuel-burning alternatives for the same money according to new ‘miles per pound’ figures.
As with petrol, prices do vary between chargers, but taking an average cost you’ll be looking at around £6-7 for 100 miles of additional charge. The expense of recharging depends on where and when you charge your vehicle.
As over 90% of electric vehicle charging takes place at home, let’s focus on home electricity tariffs. More companies are offering EV-focused plans, offering lower prices to charge during lower times of demand, such as during the night. If electricity costs around 14 pence per kilowatt-hour (on average, rates vary), then a 60kWh battery will cost around £8.40 to fully recharge. Many cars travel well over 200 miles on a single charge making the overall cost of ‘fuel’ extremely low, 4p per mile, versus 12p per mile of traditional petrol cars.
Electric Vehicle Tax Explained
As of 1st April 2025, all electric vehicles will need to pay car tax. Before this date, EV owners were exempt from paying tax as they aren’t emitting fumes like petrol and diesel cars. However, recent changes and concerns over how infrastructure and roads will be paid for after so many vehicle owners transition to electric means that EV owners can no longer avoid paying the tax.
To pay your tax, you will need to do so in full or monthly by direct debit. It can be done via post office or online through the vehicle tax website. For those who are exempt from paying tax (such as people with disabilities), the rules should stay the same.
How much will I need to pay for the EV tax?
When it comes to paying the EV tax for the first year of owning an electric vehicle, you will need to pay £10 which is the lowest rate you can pay.
From the second year of owning an EV and onwards, you will need to pay the standard rate of tax that everyone has to pay, which is £190.
For those who own what is considered a ‘luxury car’ (when a vehicle’s price was over £40,000 brand new), you will need to pay a Luxury Car Tax of £410 from the second year and for the next five years.
These rates are subject to change as we get closer to 1st April, so you may end up paying more. We advise that you look into the tax bracket that your car falls into, which will be able to give you an idea of how much you will have to pay every year.
It should be noted that although these changes are being introduced for owners of EVs which may put drivers off owning one themselves - however the overall costs of EV ownership are much less than owning an ICE (Internal Combustion Engine) vehicle: less maintenance (for less moving parts) and less ‘fuel’ costs.
Insurance Costs of an EV and Factors Affecting it
Higher initial costs
EVs often have higher purchase prices than conventional cars, which can impact insurance premiums. Insurers take replacement costs into account when determining premiums and EVs typically have expensive battery systems that can be costly to repair or replace.
Specialised repairs and parts
Since EVs use advanced technology and specialised components, repairs may require trained technicians and specific parts, potentially increasing the cost of claims. However, as EV adoption grows, repair costs are expected to become more competitive.
Lower risk of certain claims
EVs generally have fewer moving parts than internal combustion engine vehicles, meaning fewer mechanical failures. Additionally, many EVs come with advanced safety features that reduce accident risk, which can help lower insurance premiums.
Battery cover considerations
Some insurance policies include separate coverage for the battery, especially if it is leased rather than owned. Ensuring the battery is adequately covered is important, as it is one of the most expensive parts of an EV. Insuring an electric car is slightly different from insuring a petrol or diesel vehicle, but with careful research and comparison, you can find a policy that suits your needs. As the EV market continues to expand, insurance options will likely become more competitive, making it easier and more affordable to protect your electric vehicle.
Ways to reduce EV insurance costs
Just as with an ICE vehicle, there are ways to reduce your insurance costs with an EV:
Compare multiple providers
Insurance rates for EVs can vary significantly between providers. Shopping around and comparing quotes can help you find a competitive premium.
Opt for telematics for usage-based insurance
Some insurers offer policies based on driving behaviour. If you drive safely and infrequently, telematics-based insurance could help lower your costs.
Increase your security measures
Installing additional security features, such as immobilisers or trackers, can reduce the risk of theft and lead to lower premiums.
Consider a higher voluntary excess
Agreeing to pay a higher excess in the event of a claim can result in lower monthly premiums, though you should ensure you can afford the excess if needed.
Total Cost of Ownership (Estimated per year)
Compare the total cost of ownership of this car to others.
How much would it cost to charge an Electric Vehicle?
Vehicle | Battery Capacity (kWh) | Electric Range (miles) | Cost to Fully Charge (based on 14p p/kWh) | Cost per 100 miles |
48 | 170 | £6.72 | £ 3.95 | |
35.5 | 125 | £4.97 | £ 3.98 | |
50 | 170 | £7.00 | £ 4.12 | |
50 | 155 | £7.00 | £ 4.52 |
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