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The Benefits of Buying an Electric Car

Charging an electric vehicle

•    Electric vehicles are here to stay
•    Low running costs lead consumer benefits
•    Tax incentives and image boost added 'carrots' for firms

In a recent blog titled ‘The future of cars: a look at what’s ahead’, we looked at what the future holds for private transport. Electric Vehicles (EVs) were a big part of it. So why are they here to stay?

The first thing to say is that EVs are not suitable for everyone as a first car right now—but as technology continues to develop, vehicle range and batteries improve and more models come to the market, EVs are set to become increasingly viable alternatives to petrol and diesel cars for greater numbers of people.

Pure, hybrid and more

What exactly is an electric vehicle? This may seem like an obvious question, but with various definitions and different types of low emission vehicles, it can get confusing. 

Pure or fully electric vehicles are powered 100 per cent by electricity, which is stored in a battery in the vehicle. Some of the most well-known vehicles that fall within this category include the Nissan Leaf, Renault Zoe and, for those with deeper pockets, the Tesla Model S. For those interested in electric vans, Citroen, Nissan, Peugeot and Renault have vehicles available.

Plug-in hybrid electric vehicles combine petrol or diesel engines with a battery and electric motor. They can be plugged into the mains electricity and models include the BMW 2 series Active Tourer, Mercedes C350e, Mitsubishi Outlander PHEV and Toyota Prius PHEV.

Extended-range electric vehicles are powered by an electric motor that takes energy from a battery. If the battery becomes depleted, a petrol engine generates electricity to power the electric motor. The most popular model in this category the BMW i3 Range Extender. 

From now on, we'll be discussing pure electric vehicles.

Going pure – the benefits

Plugging in an electric vehicle at a charging station

The benefits of EVs include zero tailpipe emissions, no Vehicle Excise Duty (VED or “Road Tax”) , free parking and charging stations in many locations across the country, plus, if you live in or near the capital, 100% discount from the London Congestion Charge. 

Low running costs, though, are the big headline selling point. A full charge will cost around £2-3 and will give a typical range of 100 miles. By way of comparison, driving 100 miles in a petrol or diesel car, which will typically cost around £10 to £13 in fuel. To look at it another way, you will save around £100 for every 1,000 miles you drive.

Incentives and perks

To give EVs a nudge into the mainstream, the government has set up incentive schemes and pilots. One of them is the plug-in car grant: EV buyers can receive a grant up to £4,500 from the Office of Low Emission Vehicles (OLEV) on a large selection of vehicles. Plug-in van grants are also available, offering the buyers of eligible vans up to £8,000 of the cost of the van. On top of these, a grant of up to £500 is available to contribute towards the cost of a home charge point.

Depending on where you live, you may also be able to benefit from free parking, free charging or other local incentives. The Go Ultra Low city scheme, for instance, shared £40m between Bristol, London, Milton Keynes and Nottingham for projects aimed at boosting uptake of low emissions vehicles. Dundee, Oxford, York and the North East have also received money to spend on green transport.

Business benefits of buying electric vehicles

Charging a fleet of electric business vehicles

Businesses investing in EVs get the same advantages as individuals –  running cost savings, no road tax, congestion exemption and the rest, plus some added extras. Financial perks for fleets include:

  • Low Employer National Insurance Contributions (and associated lower company car tax for employees) 
  • 100 per cent First Year Capital Allowance for organisations purchasing  EVs – allowing  the whole cost of purchase to be offset against taxable profits in the first year
  • No fuel duty payable on electricity

All this points to a healthy payback, plus a very literal health advantage of helping to make our air cleaner.  For companies taking the lead, an additional effect of investing in EVs is often positive publicity – not something to be sniffed at in this age of high competition and savvy consumers. 

Whether you’re looking for a new car for the family or a fleet of new cars for your business, EVs are good for the environment, good for the wallet and good for business.

For further information, our EV webpage has various resources explaining the different types of low emission vehicles.

Joseph Cosier is the policy officer for the Energy Saving Trust.
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Why is the Scottish government vat 20% on teslar power walls.I want to run my electric car summer and winter off my solar panels.Why is this equipment not vat free.