Electric Car Running Costs

It’s fair to say that electric vehicles (EV) are becoming more and more popular with motorists up and down the country. In 2019, more than 14,000 electric vehicles have been registered so far, representing a 70% increase on last year. With UK government's plan to ban the sale of new conventional petrol and diesel cars by 2040, demand is only set to increase. But why exactly are electric vehicles so popular?

Well, while some people choose to lease an electric car because they’re fascinated by the technology, others base their decision on an ethical desire to ‘go green’. For most of us though, leasing an electric car is about cutting costs. But with no fuel costs, are electric cars really cheaper to run?

To help you assess running costs of running an electric car, we’ve put together a short guide on the costs involved in running an electric with a comparison to petrol and diesel counterparts.

What are the costs of running an electric car?

Before we delve into the numbers, it’s worth taking a look at what exactly is involved with running a car, no matter what fuel type it is. Just like a petrol or a diesel car, there are lots of things to consider when running an electric car. These include:

• Fuel
• Insurance
• Servicing
• Replacement Tyres

If you’re buying instead of leasing, you’ll also have other factors to consider including depreciation costs and car tax bands, while businesses may want to consider tax implications and other costs such as the London congestion charge.

To keep things simple, for this guide we’re just going to look at the typical monthly costs involved in leasing an electric car, and how these compare versus petrol or diesel. If you want to understand more about the differences between buying and leasing, check out our guide.

Electric vs Petrol vs Diesel – The Comparisons

To try and give you as balanced a view of possible, we’ve compared the BMW i3 with a similarly-priced petrol and diesel model from the same manufacturer and analysed the costs below in more depth to highlight whether you could save money by going green.

These figures are based on one year running costs, covering 10,000 miles annually.

*Based on information supplied by CAP HPI

How much does it cost to charge an electric car?

Just like petrol and diesel prices which vary from supplier to supplier, the cost to charge an electric car in the UK varies between home, work and public charging. You can read more in our Electric Car Charging Costs guide. 

Although many public and work EV charge points are free to use, some require payment, costing on average between £1.50 to £3 per hour, plus 17p for each kWh of electric.

Charging at home is often the most convenient and cost effective way to recharge an electric vehicle. Most EV drivers charge their electric car overnight, preferring to wake up to a full battery every morning. To charge an electric car at home, you will need a home charging point installed, although thanks to Government grants, these can cost from as little as £279 with the OLEV grant.

In terms of cost, the average domestic electricity rate is about 14p per kWh, meaning it would cost you around £5.88 (3.1p per mile) for 188 miles of range using a 3kW home charger according to Zap-Map home charging calculator.

So how does this compare with fuel costs for petrol and diesel?

*Assumes tariff of 14p/kWh. The cost of home charging will vary depending on your electricity rate

**Based on average UK fuel costs estimated by Confused.com

How much is the insurance on an electric car?

After initial purchase, the next big cost involved in driving a car is insurance. Once again, like petrol and diesel cars, the cost of insuring your electric vehicle comes down to a number of factors, which typically include:

• Vehicle Make and Model - The fancier your vehicle, the more expensive it is to insure
• Driver Age – Younger drivers are considered a bigger risk, therefore, increasing premiums
• Driving History – Including accidents and traffic violations will be taken into consideration
• Where You Live – Cars parked in areas with higher crime rates will be subject to higher premiums

As insurance costs vary from driver to driver, the easiest way to compare annual insurance costs is to look at insurance groups. All cars in the UK are placed into an insurance group band ranging from group one (the cheapest) to group 50 (the most expensive). As a general rule, the more powerful, expensive and rarer your car, the higher the group it will be in. You can read more about this in our UK Car Insurance Groups Explained guide.

To encourage car manufacturers to fit better security systems, the insurance group rating process also looks at security devices fitted as standard. Where security has been rated, the insurance group number, from 1 to 50, is followed by a letter, which shows the results of the assessment.

E= Exceeds the security requirement for a car of this type

A = Acceptable security requirements for the car's group

P = Provisional – incomplete data when the model was launched

D = Doesn’t meet the security requirement for a car of this type so the group rating has been increased as a result.

U = Unacceptable – the level of security is significantly below requirements.

G = Import

So how does an electric vehicle compare with petrol and diesel in terms of insurance?

*Based on information supplied by CAP HPI

How much is it to service an electric car?

To keep your new car in tip-top condition, you will need to service it on a regular basis, at intervals recommended by the car manufacturer.

A car service is an essential part of your lease agreement, as well as an important part of the manufacturer's warranty. By keeping your car in a good condition with regular servicing, you will also be less likely to incur high garage charges or fair wear and tear charges in the future.

So how does servicing costs compare between electric, petrol and diesel models?

*Based on a BMW Pay Monthly Service Plan

How much are tyres are on an electric car?

Finally, with tyre wear playing an important part in the safety of the vehicle, it is worth considering the costs involved in replacing the tyres on your vehicle and how this impacts the running costs.

Whether you’re driving an electric vehicle, a petrol or a diesel, it is important that the tyres you select are appropriate for the size and model of your individual car. Additionally, as with any car, you must also ensure that you are running at the correct tyre pressure for the size and weight of your vehicle. You can read more about tyre safety in our Replacing The Tyres On Your Lease Car guide.

So how does this compare with petrol and diesel models?

*Based on prices for Bridgestone tyres from Protyre

So, will leasing an electric car will save me money or not?

While the initial purchase price of an electric vehicle may be high, when comparing running costs, electric cars can be significantly cheaper to run than a petrol or diesel-fuelled car.

If you’re ready to lease an electric vehicle, check out our range of electric cars and our latest deals.