Last updated on November 26th, 2024 at 07:52 am
As World EV Day approaches on 9 September, many drivers are considering the benefits of switching to an electric vehicle (EV). Ohme, a prominent player in the smart home EV charging sector, is highlighting how motorists can reduce their vehicle running costs significantly by making the switch from petrol or diesel to electric. EV ownership not only helps the environment by reducing emissions but can also help drivers save money. In celebration of World EV Day, Ohme has shared five money-saving tips for those already driving or thinking about purchasing an EV.
1. Drive an Electric Vehicle
The most obvious tip is to drive an EV in the first place. According to Ohme, just switching to an electric vehicle can result in significant savings on fuel costs. Petrol and diesel prices continue to fluctuate, and traditional internal combustion engine (ICE) cars require constant refuelling, which can quickly add up. For example, the average driver in the UK is estimated to spend over £1,100 annually on fuel alone.
In contrast, by charging an EV at home, this cost can be dramatically reduced. Even with the electricity rate set to increase from 1 October, charging an electric vehicle at home could bring annual fuel costs down to just £416.50 – more than halving the expense compared to running a petrol or diesel vehicle. This significant reduction in running costs is a strong incentive for more drivers to make the shift to EVs.
2. Choose a Dynamic Home Electricity Tariff
One of the key ways to cut costs even further is by opting for a dynamic home electricity tariff. Providers like Octopus and OVO offer dynamic tariffs that allow EV owners to access electricity at much lower rates during off-peak hours. According to Ohme, some drivers could potentially reduce their EV running costs to less than £10 a month by charging during these cheaper times.
With an Ohme smart EV charger, drivers can automatically charge their vehicles when electricity prices are at their lowest, reducing the overall cost of running an EV. A typical driver, covering around 6,800 miles annually, could see their costs drop to as low as £119 a year, depending on the tariff they select.
3. Take Advantage of Cheaper Overnight Electricity
Many dynamic home electricity tariffs offer reduced rates during overnight hours, which is a great opportunity not just for EV drivers but for household energy users in general. These tariffs often allow all electricity used within a certain time window to be charged at the lower rate. This means that drivers who charge their EVs overnight can also save money on other household appliances by running them during these same off-peak periods.
Households with an EV can use this strategy to their advantage, reaping additional savings beyond their vehicle charging. By running energy-intensive appliances such as dishwashers, washing machines, or even heating systems during cheaper hours, households can cut down on overall electricity costs. There are a number of good choices when it comes to EV chargers that can save you money while you sleep.
4. Consider an EV Company Car or Salary Sacrifice Scheme
For those with access to a company car, switching to an electric vehicle presents another opportunity for savings. Under current UK tax rules, electric vehicles benefit from much lower Benefit-in-Kind (BiK) tax rates. For example, in the 2024/25 tax year, the BiK rate for EVs will remain at just 2%. This rate is significantly lower than the rates applied to petrol and diesel vehicles, making EVs a highly cost-effective option for company car users.
Additionally, many employers now offer salary sacrifice schemes for EVs. These schemes allow employees to lease an EV using their pre-tax income, further reducing the overall cost of the vehicle. Since the lease payments are deducted from gross income, employees end up paying less tax and national insurance, leaving them with more disposable income. Salary sacrifice schemes have grown in popularity due to the financial benefits they offer both employees and employers.
5. Participate in Grid Flexibility Trials
Beyond everyday driving, EV owners can further contribute to reducing energy costs by participating in grid flexibility trials. Ohme has been involved in an Ofgem-sponsored project called the CrowdFlex energy trial, designed to study the role EVs can play in balancing the national grid.
EV drivers were incentivised to plug in their vehicles more frequently, helping to stabilise energy demand during peak periods. By participating in such trials, EV owners could earn rewards for simply plugging in their cars while parked at home. Ohme is set to continue its involvement in similar trials from this month until April 2025. It is estimated that grid flexibility services like these could save UK consumers as much as £10 billion annually by 2050 by reducing the overall cost of energy supply.
World EV Day offers a timely reminder of the financial and environmental benefits of switching to electric vehicles. As demonstrated by Ohme's tips, the savings can be substantial, particularly when drivers take advantage of smart charging technology, dynamic electricity tariffs, and EV-friendly tax schemes. With ongoing developments in grid flexibility and the broader integration of renewable energy, the cost savings for EV drivers are expected to grow further in the coming years.
For drivers considering making the switch, or for those already on the EV journey, Ohme’s advice provides practical steps to reduce costs and take full advantage of the benefits that electric vehicles have to offer.
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