Are electric cars cheaper to run?

Owning an electric car is saving you more money than before.

As petrol prices have increased significantly during the past 12 months, so has the cost benefits of driving a battery-powered vehicle.

Not only are battery-powered vehicles generally better for the environment because they don’t produce harmful greenhouse gases – depending on the power source used to recharge the battery pack, of course – they are cheaper to ‘refuel’ than a petrol-powered equivalent.

But the benefits don’t end there as EVs are also more affordable to maintain, too.

Now, that might sound at odds with the perception that electric cars are complex machines. They are in fact much simpler than conventional cars with less moving parts and none of the auxiliary systems that need attention.

Electric motors are sealed units that do not require regular servicing as they do not have lubricants such as oil or ancillaries like spark plugs and filters that need to be replaced often in order to remain in optimum working condition.

They also lack complicated cooling and fuel-delivery systems that can fail and generally require expensive parts and extensive labour to rectify.

Similarly, battery packs are sealed and do not require any specific maintenance.

Like a combustion engine they do lose performance over an extended period of time, with most car-makers guaranteeing they will remain properly operational for the life of the car and providing a warranty of between 8-10 years.

At the moment, the cost to replace an EV battery pack (40kWh) is around $8000 – which is not really any more than a failed combustion engine.

However, as car-makers are set to significantly increase the production of EVs over the next decade, financial analysts predict the price of batteries will drop drastically, by more than half before 2025, which would mean a replacement battery could cost around $2500 within a few years.

That said, electric vehicles do still require regular check-ups as conventional mechanical systems, such as the transmission, brakes, suspension and steering, are affected by everyday driving habits in exactly the same manner as a petrol-powered vehicle with consumable elements like brake pads and tyres that wear out over time.

That is why car-makers still state that dedicated battery-electric vehicles must follow a yearly service schedule to ensure they are safe to operate.

At the moment, the Electric Vehicle Council of Australia states that servicing costs for an EV are between $300-$400 cheaper per year than a conventional vehicle.

Highlighting that fact, the specialists at RedBook.com.au calculate that the Hyundai Kona Electric owner will save $2205 in running costs over a five-year period, measured against the smaller Suzuki Baleno GL, a conventional light hatch often held aloft as one of the cheapest models to run in the current new-vehicle market.

That’s just the cost of electricity for the Hyundai and petrol for the Suzuki, based on an electricity tariff of $0.30 per kilowatt-hour and 91 RON petrol at a cost of $1.73 per litre.

Capped-price servicing ($1445 for the Kona, $1635 for the Baleno) reduces the cost of ownership further, as does any electric vehicle concession from the state registration authorities.

Insurance will cost more, however, as will tyres and depreciation.

RedBook currently projects that the Kona will retain 54.5 per cent of its new-car value after five years, compared with the Baleno at 61.5 per cent.

Everything you auto know about electric cars