MPs vote on EVs: petrol car owners facing extra £1,350 a year in fuel costs, compared to EV drivers

Petrol prices are volatile but have been steadily rising for the past twenty years - meanwhile electricity prices are set to fall in the coming years as the effects of the gas crisis diminish.

Second-hand electric Nissan Leafs are available to buy for just over £2,000 more than an equivalent petrol Nissan Juke. But, being much cheaper to fuel, the higher purchase price of the Nissan Leaf would be paid off in less than two years on the road.

Commenting on the analysis, Colin Walker, Head of Transport at the Energy and Climate Intelligence Unit, said:

“Petrol prices are volatile and controlled by foreign regimes, but as more of our energy comes from British renewables, we’ll be insulated from those high costs. The premium people will have to pay to drive a petrol car will increase in the coming years as petrol costs are likely to continue rising while the costs to charge an EV are set to fall.

“For the UK’s drivers to avoid paying this rising petrol premium, we need a healthy second-hand EV market, as that’s where the vast majority of people buy their cars. And that’s where the ZEV Mandate comes it. It will increase the pace at which new EVs arrive on our roads, thereby increasing the pace at which EVs arrive on the second-hand market – helping ensure that the UK’s drivers won’t be stuck driving more expensive petrol vehicles for longer than is necessary”.

A four-year-old EV bought today will, over the remaining 10 years of its lifespan, save on average over £12,000 in total fuel costs compared to a petrol equivalent.

MPs are set to vote on Monday 4th Decemeber on the Zero Emission Vehicle mandate. This will require car makers to ensure that a minimum percentage of their sales are EVs, increasing year on year.

Commenting on the analysis Professor Gavin Bridge, Fellow of the Durham Energy Institute at Durham University, said,“Oil prices are volatile and vulnerable to geopolitical shocks, as we recently witnessed following Russia’s invasion of Ukraine. But there is little reason to think that the prices UK drivers pay for petrol and diesel will not continue the long-term rise they have displayed for the past twenty years. They are certainly unlikely to fall far enough, and remain low long enough, to erode the fuelling cost advantages of EVs.”

The report looks at two scenarios for future petrol prices. In its main scenario, in which petrol prices increase at the same rate they have increased over the past 20 years, the extra cost of fuelling a petrol car compared to an equivalent EV will rise from just under £1,100 today to £1,350 in 2023 – an increase of almos £270 a year. Even under a more conservative scenario in which petrol prices rise more slowly for the rest of the decade, it will cost an extra £230 to fuel a petrol car in 2030, compared to an EV, than it does now.

In 2023, for a petrol car to be cheaper to fuel than an equivalent electric vehicle, petrol would have to drop from £1.48 to 38p a litre. By 2030, falling electricity prices would mean the cost for a litre of petrol would have to drop even further – from a forecast price of £1.65p a litre to 28p a litre.