A common reason that swayed many to make the switch to an electric vehicle is the fact that charging an EV is cheaper than fueling a petrol or diesel car. The post-pandemic return to normality massively impacted the cost of fuel, and it remains high due to the war in Ukraine. But now that the cost of electricity is rising too, is it still cost-effective to switch to an EV?
A recent survey of 12,000 motorists conducted by the AA found that 63% of participants claimed that part of the reason they’ve been put off switching to an EV is due to the rise in energy bills, with 10% stating that it was the main reason.
New research by RAC shows that it is becoming more expensive to charge EVs, with the cost of pay-as-you-go publicly accessible rapid chargers increasing by 42%. These chargers, running on the public network, cost around 18p per mile, which is a 38.5% increase from May (13p). This has drastically closed the gap between the cost of charging and the cost of fuel, with petrol costing an average of 19p per mile, and diesel 21p.
However, drivers should not give up on electric cars! RAC’s research only concerns the pay-as-you-go public accessible rapid and ultra-rapid chargers and does not relate to the figures for charging an EV at home, or at your workplace. It’s worth noting that rapid and ultra-rapid chargers have always sat at a higher cost than other charging alternatives due to their speed and convenience.
Smart charging at home
For EV owners with the ability to charge from home, choosing a smart charger can be an effective way to save money on each charge.
Smart charging refers to a system where an EV and a charging device share a data connection, and the charging device shares a data connection with a charging operator. This allows the charging station owner to monitor, manage and restrict the use of their devices remotely to optimise energy consumption.
Smart chargers will charge the EV at times when the demand for electricity is lower, such as at night, or when there is an abundance of renewable energy on the grid. Not only does this reduce the pressure on the national grid, but, with the right energy tariff, it can save money on every charge.
Also, don’t forget that in their drive to go green, many workplaces are installing charge points for their employees’ use.
Installing EV charge points at the workplace can be beneficial for many businesses. Employees with EVs gain the opportunity to charge their cars during the work day, as well as any visitors to the site. Given the rising cost of pay-as-you-go public charge points, there’s never been a better time to invest in EV chargers at the workplace.
Some businesses choose to allow employees to charge their EVs for free on-site. This is especially relevant when company EVs are provided to staff, as the business would be paying for fuel for a petrol or diesel company car, so it makes sense to provide charging opportunities for free. It’s worth noting that there are no BIK tax implications when providing free company charging, as electricity is not recognised as fuel by HMRC.
Businesses that do not wish to provide EV charging for free to their employees may charge a subsidised cost. This is most commonly either paying for the exact amount of electricity used for the charge, or a smaller portion. These charges remain cheaper than the pay-as-you-go public chargers, so having the option for your employees can act as a great incentive.
Is it still cost-effective to switch to electric?
Currently, the cost of pay-as-you-go public charging is still cheaper than fuel alternatives, albeit by a small difference. Whether or not it remains cost-effective to switch to electric depends on your situation. If you can viably instal a home charger with smart charging features, or if your workplace provides free or subsidised charging, it is still cheaper to run an electric car than petrol or diesel.
Jack Cousens, head of AA roads policy said: “With domestic energy prices rising, drivers can be forgiven for believing switching to an EV will become expensive quickly… However, the reality is that even with the hike in domestic electricity costs, running an EV is considerably cheaper than a petrol or diesel car.”
In some instances, such as long journeys or unexpected detours, EV owners may be left with no choice other than to use a publicly accessible charging station. If these charge points are only used as a necessity and not relied on consistently for charging the vehicle, the cost of charging an EV remains much lower than fueling a petrol or diesel alternative. To further save money on the switch from fuel to electric, check out the government grants for EV charging installation.
The Office of Zero Emission Vehicles (OZEV) EV chargepoint grant can fund up to 75% of the costs of installing a charge point in domestic properties, and the Workplace Charging Scheme (WCS) provides support towards the upfront costs of the purchase and installation of charge points for businesses, charities and public sector organisations. Check your eligibility for the current grants by completing our quick online quiz
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