ELECTRIC VEHICLES ARE NEARLY £600 CHEAPER TO RUN THAN PETROL CARS

Published: 06/05/2022

Annual cost of driving an electric vehicle (EV) is £579 cheaper on average than a petrol car
EVs cost an average of £1,264 to run for 12 months compared to £1,843 for a petrol car
However, the average annual running cost for an EV has still increased by £137 year-on-year due to higher energy costs
The growing number of EV drivers in the UK could save an average of £101 by shopping around for a cheaper deal on car insurance

25 April 2022 – The annual running cost of an electric vehicle is now £579 cheaper on average than a petrol-fuelled car, according to the latest research from comparethemarket.com. This difference in cost has increased from 2021 when EVs were just over £400 cheaper to run.

The research, which analyses the price of insurance, fuel, and road taxes, shows that the average annual cost of running a petrol-fuelled car is now £1,843, whereas an electric vehicle (EV) costs an average of £1,264 to drive for 12 months.

While petrol cars are usually more expensive to run due to the annual road tax exemption for EVs, the cost of driving both types of car has risen year-on-year. For EVs, the cost has increased by £137 year-on-year, primarily due to higher energy costs in recent months. The average annual energy bill for an EV has increased by £167 year-on-year to £519, based on driving 6,700 miles, the UK average. Despite the average EV car insurance premium falling by £29 year-on-year, EVs are still typically more expensive to both buy and insure than similar petrol cars. EV owners also usually choose to install a home charging point which would add an additional cost.

In contrast, the average annual cost of running a petrol-fuelled car has risen by a much steeper £313 year-on-year to £1,843. This sharp rise in running costs has mainly been driven by the increase in the price of petrol and higher car insurance premiums. The average annual fuel cost for a petrol car is now £943 – a £221 increase compared to the previous year. In contrast to EV insurance premiums falling marginally year-on-year, the average car insurance premium for petrol cars has risen by £82 year-on-year due to a rise in the value of second-hand cars and replacement part inflation.

Electric cars continue to grow substantially in popularity, with March data from the Society of Motor Manufacturers and Traders indicating these vehicles now make up around one in three new car sales. The accelerating number of EV car owners could offset some of the increased running costs of their cars by shopping around for a cheaper deal on their insurance. EV drivers could save an average of £101 by switching to the cheapest motor premium available.

Alex Hasty, director at comparethemarket.com, said:

"Despite surging energy bills, motorists who’ve made the switch will be glad to see that electric vehicles cost substantially less to run than a petrol alternative. As well as helping the environment, these drivers benefit from savings in fuel, insurance, and tax. However, there is a significant upfront cost of buying an electric car and installing a home charging point which will prevent many drivers from being able to afford this option.

“Both electric and petrol car owners could help reduce the cost of running their car by switching to a cheaper insurance policy ahead of their renewal. Our research shows that motor insurance prices are £314 cheaper on average by switching 21 days before the end of a policy.”

ANNUAL AVERAGE COST OF RUNNING AN ELECTRIC VEHICLE
Cost name	2022 costs	2021 costs
Insurance	£690	£719
Fuel	£519	£352
Est. VED (Road Tax)	£0	£0
MOT	£55	£55
Total cost per year	£1,264	£1,127

AVERAGE ANNUAL COST OF RUNNING A PETROL-FUELLED CAR
Cost name	2022 costs	2021 costs
Insurance	£680	£598
Fuel	£943	£722
Est. VED (Road Tax)	£165	£155
MOT	£55	£55
Total cost per year	£1,843	£1,530

Notes to editors:

Methodology

Insurance data is sourced from comparethemarket.com.

When the “average price” is referred to, this is the mean average of the top five cheapest prices presented to a customer, where a consumer has clicked through to buy. Buying from the top five cheapest prices presented represents 90% of all car insurance sales. When the “cheapest price” is referred to, this is the average cheapest price presented, where a customer has clicked through to buy.

Premium Drivers calculates the cost of premiums where the customer has clicked through to buy the policy. If the average premium cost was instead calculated on the basis of all prices returned then the average cost would be significantly higher.

Fuel cost

Annual fuel costs based on drivers travelling 6,700 miles per year (Source: Office of National Statistics)
Petrol priced at £1.24 per litre in 2021 and £1.62 in 2022 (Source: ONS March 22 and March 21). Fuel efficiency is 5.40 litres per 100km (Source: Department for Transport)
Electricity priced at 19p per kWh in 2021 and 28p per kWh in 2022 (Source: Ofgem Price Cap 2021 and 2022). Fuel efficiency is 17.2 kWh per 100km (Source: average efficiency for the ten most popular models on comparethemarket.com)

About comparethemarket.com

comparethemarket.com was launched in 2006 and has grown rapidly over the past sixteen years to become one of the UK’s leading price comparison websites.

comparethemarket.com provides customers with an easy way to make the right choice for them on a wide range of products including motor, home, life, travel and pet insurance as well as utilities and money products such as credit cards and loans.

comparethemarket.com actively works with its brand partners to help provide great services to customers.

comparethemarket.com is a trading name of Compare The Market Limited. Registered in England No. 10636682. Registered Office: Pegasus House, Bakewell Road, Orton Southgate, Peterborough, PE2 6YS. Compare The Market Limited is authorised and regulated by the Financial Conduct Authority for insurance distribution (Firm Reference Number: 778488). Energy and Digital products are not regulated by the FCA.