Whilst the amount of renewable energy is growing in the UK, one area, in particular, remains a significant challenge in our fight against climate change and race to net-zero: road transportation.
Since 1990, greenhouse gas emissions from road transportation have increased by 6% and in 2017, made up around a 5th of the UK’s total greenhouse gas emissions. It’s safe to say that road transportation is a big polluter, with most vehicles on the road burning petrol or diesel to get from A to B. This not only contributes to climate change but also causes some serious air pollution, especially in big cities like London.
The good news? Electric vehicles are growing in popularity year on year and are now being championed by the Government. Here at Tariff.com, we also think that electric cars are the future. That’s why we can offer your business all the support and help it needs to stay ahead of the curve and reduce its greenhouse gas emissions. Let’s take a closer look at electric vehicles.
EV is the acronym for electric vehicles and is the umbrella term used to describe a vehicle (often a car) that is powered by a battery charged with electricity. Whilst the term EV does encompass hybrid cars such as HEVs (hybrid electric vehicles) and PHEVs (plug-in hybrids), in this article we’ll be focusing on BEVs (battery-powered electrics vehicles).
These types of EVs are powered solely by a battery and have no internal combustion engines. They, therefore, don’t use any petrol or diesel or release any tailpipe emissions. For this reason, EVs are often hailed as a game-changer in the fight against air pollution and climate change; when the electricity used to power an EV comes from a renewable source e.g wind or solar, they can be much better for the environment than regular combustion-based vehicles.
Interestingly, electric cars are certainly not a new invention; it’s widely believed they were first invented in 1832. It probably wasn’t until the late 1990s when electric cars would really start to develop, with Toyota releasing the hybrid Prius in 1997.
Of course, we couldn’t have an article on electric vehicles without mentioning Tesla. Launched in 2006, Tesla became known for its next-generation, yet high-end electric vehicles. It would be 4 years later before a more affordable all-electric vehicle came on the scene, courtesy of Nissan. The Nissan Leaf, launched in 2010, is often cited as the first all-electric vehicle to be commonly seen on roads.
Whilst EVs have no doubt grown in popularity over the past decade, UK roads are still dominated by petrol and diesel cars. In 2021, over 515,000 electric cars were registered in the UK, an impressive increase from a decade ago, when less than 1% of new car registrations were electric.
With the UK Government pledging to ban the sale of all new non-electric cars, including gasoline, diesel and hybrid vehicles from 2035, electric cars will no doubt experience a huge uptake in the decades to come. Indeed, a study carried out by Ofgem found that 24% of consumers plan to buy an electric or plug-in hybrid in the next 5 years.
Now we’ve discussed electric vehicles in more depth, let’s take a closer look at the pros and cons.
Better for the Environment
As purely battery-powered electric cars don’t have a combustion engine, they don’t burn fossil fuels to power motion. They also don’t have a tailpipe so they don’t release emissions and contribute to air pollution, making them a preferred choice for city driving. The battery is charged by electricity, which can either come from fossil fuels or renewable energy- and the environmental benefits of an electric vehicle are really determined by that choice of energy tariff.
Lower Running Costs
Whilst the initial payout for electric vehicles is often more expensive, the running costs are much cheaper than petrol or diesel models. Driving 100 miles in an electric car would cost you a grand total of £1.30, whilst covering the same distance in a petrol car would cost you a whopping £11.05. For both individuals and businesses, this could result in substantial savings on travel costs. On top of this, maintaining and servicing EVs is much simpler, meaning that you could also save costs in these areas.
Reduced Congestion Charge
For those that regular commute or drive in cities, particularly London, opting for an electric vehicle could save you substantial costs on congestion charges. Designed to tackle air pollution, Clean Air Zones or Ultra Low Emissions Zones charge a fee for cars that are considered polluters. The Ultra-Low Emission Zone cost £12.50 a day. EVs are exempt from paying these charges and could potentially save drivers around £2,875 a year.
Tax Exemptions
At the time of writing, fully electric cars are fully exempt from road tax, also known as VED (Vehicle Excise Duty), offering EV drivers another financial incentive to make the switch. Businesses looking to implement EV vehicles as company cars will also benefit from a lower Benefit-in-Kind (BiK) rate of just 1% for 2021/22 and 2% for 2022/23, a considerable decrease from around the 14%-30% rate for hybrid, petrol, and diesel vehicles.
Subsidiaries and Funding
With the UK’s ambitious net-zero target fast approaching, the UK Government are now offering a number of subsidiaries and funding option to incentivise the adoption of electric vehicles. The PICG (Plug-in car grant) offers a grant of up to £2,500 to support the purchase of eligible vehicles, whilst the WCS ( Workplace Charging Scheme) provides financial support to install charging points at businesses, charities or organisations. Whether you’re an individual or business, with all the financial support available for EVs, now could be the best time to invest in your EV future.
Despite all of the advantages of electric vehicles, there are still some limitations that are affecting the uptake.
High Purchase Price
Despite their lower running and maintenance costs, electric vehicles are expensive to buy. The average cost of buying a non-luxury electric vehicle is around £27K, with the cheapest one clocking in at around £17,350. Despite the Government grants available, this is still a hefty sum for the majority of people- and certainly offputting when it comes to making the switch.
Lack of Charging Points
If we’re truly to embrace electric vehicles in the UK, there’s one thing we definitely need more of- EV charging points. At the time of writing, there are about 25,000 electric charging points across the UK. Yet the CMA (Competition and Markets Authority) estimates we’ll need at least 10 times more to meet the increasing need caused by the ban of new petrol and diesel cars in 2030.
Limited Variety
Whilst the range and affordability of electric cars is increasing, the same can’t really be said for other, larger types of vehicles. According to the BBC, vans are one of the fastest-growing transportation types of UK roads. Whilst smaller e-vans are available, the price point remains a sticking point for many smaller businesses and contractors- it’s far more expensive to lease an electric van than it is a diesel one.
If you’re looking to find out more information about adopting either electric vehicles or charging points at your business, get in touch with Tariff.com today. Our Tariff team can provide all the advice and support you need to get ready for an EV future.
You can also view our article on the Workplace Charging Scheme here or have a read of our EV pages here.
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