You’ve seen them glide silently past traffic. You’ve read about their instant torque. But one question still nags at most UK drivers: are electric cars really cheaper in the long run?
The sticker price can be intimidating — that extra premium for the electric version. But the headline figure isn’t the full story. To get the real answer, you have to look at the Total Cost of Ownership (TCO) — every cost that comes with running a car: fuel, tax, insurance, servicing, and depreciation.
So let’s crunch the 2025 numbers and find out whether electric cars in the UK genuinely save you money — or just your conscience.
The Six Key Costs of Car Ownership
To compare fairly, we’ll use a typical three-year ownership period for a mid-range family car. Here’s how the two contenders stack up.
1) Purchase Price
EVs still cost more up front. With the Plug-in Car Grant gone, buyers lean on the growing used market or manufacturer incentives. Expect to pay roughly 15–25% more for an electric version of a comparable petrol car.
Verdict: Petrol wins on showroom price.
2) ‘Fuelling’: Electricity vs Petrol — the Game Changer
This is where EVs pull away. Running costs per mile are dramatically lower, especially if you charge at home on a dedicated EV tariff.
Assumptions for 2025:
- Annual mileage: 10,000 miles
- Petrol efficiency: 45 mpg; petrol price reference points around the mid-£1.30s–£1.50s per litre in 2025
- EV efficiency: 3.5 mi/kWh
- Home EV tariff examples: ~8–10p/kWh off-peak (British Gas EV tariff)
- Public rapid charging guide price range: ~55–89p/kWh (Zapmap Rapid Prices)
- Split: 80% home, 20% public
Illustrative annual fuel cost:
- Petrol: ~£1,565/year
- Electric: ~£600/year
Annual saving: ~£965 in this scenario.
Reference data points: RAC Fuel Watch and GlobalPetrolPrices track weekly UK averages; local prices vary.
Verdict: EVs win decisively on energy cost.
3) Servicing & Maintenance
EVs have fewer moving parts: no oil changes, timing belts or exhausts — and regenerative braking extends brake life. Major UK fleet datasets consistently show ~30–40% lower maintenance spend over the life cycle (model dependent).
Verdict: EVs win.
4) Tax (VED & Company Car Tax)
Vehicle Excise Duty (VED): From 1 April 2025, zero-emission cars registered on/after that date pay the lowest first-year rate of £10, then the standard rate (currently £195) from year two. Cars with a list price over £40,000 also pay an Expensive Car Supplement of £425 for years 2–6 (GOV.UK VED guidance).
Company Car Tax (BiK): For pure EVs the appropriate percentage is 3% in 2025/26, then rises by 1pp per year to 5% by 2027/28, and is scheduled to increase further from 2028/29 (HMRC announcements).
Verdict: A huge advantage for EV drivers taking a company car; check list price and registration date for VED specifics.
5) Insurance
EV insurance can be slightly higher today due to repair pathways and parts costs, but premiums are normalising as volumes and repair capacity grow.
Verdict: Slight edge to petrol — shrinking gap.
6) Depreciation
Modern, high-demand EVs (e.g., compact crossovers and family saloons) are now holding value competitively against petrol equivalents, subject to brand, supply and incentives.
Verdict: broadly a draw across popular segments.
The Verdict: A 3-Year Cost Comparison (Illustrative)
Assumes 10,000 miles/year, 80% home charging on a competitive EV tariff, and EV list price under £40,000 to avoid the Expensive Car Supplement. Adjust for your exact model, prices and tariffs.
| Cost Factor | Typical EV | Typical Petrol SUV |
|---|---|---|
| Purchase Price (Est.) | £39,000 | £33,000 |
| ‘Fuel’ (3 Years) | £1,800 | £4,695 |
| Servicing (3 Years) | £450 | £750 |
| VED (3 Years, post-Apr 2025) | ~£400 (Yr1 £10 + Yr2/3 £195) | Varies by CO₂ (Yr1 banded + £195 standard) |
| Total 3-Year Cost (guide) | £41,650 | £38,445 |
If your EV’s list price is above £40,000, add the Expensive Car Supplement (£425/yr, years 2–6). For company car users, EV BiK at 3–5% typically flips the maths firmly in the EV’s favour.
Final Thought: The Tipping Point Has Arrived
For private buyers who can charge at home — and especially for company car drivers — EVs are no longer the future; they’re the smart financial choice now. Lower fuel bills, cheaper servicing, competitive depreciation and favourable BiK all add up fast.
Ready to cut your running costs? Start with smarter home charging — that’s where the biggest savings live.
Next up:
References:
FAQs: True Cost of an EV in the UK
Do EVs really save money long-term?
Yes. In our 10,000-mile scenario, fuel alone saved ~£965/year versus petrol, with further savings from lower servicing.
Are EVs still exempt from road tax?
No for new registrations: from 1 April 2025, EVs pay £10 in year one and the standard rate from year two; cars over £40k add an Expensive Car Supplement.
Is home charging always cheaper?
Almost always — particularly on off-peak EV tariffs under ~10p/kWh. Public rapid charging costs more; plan mixed charging to keep averages low.
What about insurance?
Historically higher for some models, but the gap is narrowing as repair networks scale. Always compare quotes.
How can ONEEV help?
The ONEEV app finds affordable chargers, shows live availability and helps you charge smarter — with lifestyle rewards along the way.
