Electric cars (EVs) are often marketed as a cheaper and greener alternative to petrol and diesel vehicles — but the hidden costs of owning an electric car can catch buyers off guard.
From upfront purchase premiums to long-term maintenance, these less-obvious expenses can significantly affect the total cost of ownership (TCO).
If you’re comparing electric car running costs, it’s vital to include these factors so you get a realistic picture of what EV ownership really costs.
1. Higher Upfront Purchase Price
Compared with equivalent petrol and diesel models, electric cars generally carry a higher sticker price — largely due to expensive battery technology. On average, EVs cost several thousand pounds more than internal combustion engine vehicles before incentives.
Even with grants or tax credits, that higher purchase price often means bigger monthly loan repayments or a larger upfront outlay — a key part of EV cost calculations many buyers underestimate.
2. Charging Infrastructure and Energy Costs
Many electric car owners assume charging is free or always cheaper than petrol — but charging infrastructure costs are real and vary widely:
- Home charging setup: Installing a dedicated EV home charger (wall box) can cost several hundred to over a thousand pounds, depending on installation complexity.
- Public charging fees: Public rapid chargers often charge higher rates per kWh or per minute than home electricity, meaning electric car fuel costs can balloon if you rely on them frequently.
And while home charging tends to be cheaper per mile, households with high domestic electricity tariffs may still face significant yearly energy bills.
3. Battery Degradation and Replacement
The battery is the heart of an EV — and also one of its most expensive components. Over time, all batteries naturally lose capacity, reducing your effective range. Many EV manufacturers only guarantee the battery for around 8 years or 100,000 miles.
Battery replacement, if ever needed, can cost thousands of pounds, with some packs running between £5,000 and £20,000+ depending on make and model — a cost most petrol car owners never encounter.
4. Insurance Premiums and Repair Costs
Electric cars typically attract higher insurance premiums than petrol or diesel cars. That’s partly because EV components (especially the battery) are costly to replace, and specialised repair technicians are less common.
Repair bills for EVs can also be higher: a seemingly minor accident that damages the battery or electrical systems can lead to major bills or even a write-off, further pushing up insurance costs.
5. Depreciation and Resale Value
EVs can depreciate faster in value than traditional cars. Some reports indicate EVs may lose a larger share of their value over the first five years than comparable petrol cars, which affects how much you get back when it’s time to sell.
While depreciation alone isn’t a cash cost you pay annually, it directly impacts the true cost of owning an electric car over the long term.
6. Vehicle Taxes and Registration Fees
In several markets — including the UK — electric cars are now liable for standard vehicle excise duty (road tax) and, for pricier EVs, an additional “expensive car” supplement once the vehicle’s value surpasses certain thresholds.
Some regions also impose additional EV registration fees or annual charges intended to recoup lost fuel duty revenue, adding another piece to the ongoing cost picture.
7. Time Costs of Charging and Range Limitations
Charging an EV takes longer than filling up a petrol tank. While charging time isn’t a direct financial cost, it’s a real opportunity cost for many drivers — especially those without home charging or with long commutes — and one many initial buyers overlook.
Range limitations on some electric models may mean more frequent charging stops on long journeys, potentially increasing both time and public charging expenses.
Expert Insight
“We’re buying electric cars for sustainability reasons, but an EV isn’t very sustainable if you’ve got to throw the battery away after a minor collision.”
— Matthew Avery, Research Director, Thatcham Research (on how battery replacement and damage can affect both costs and environmental impact)
FAQ: Hidden Costs of Owning an Electric Car
Q: Are electric cars cheaper to run than petrol cars?
A: It depends. EVs often cost less per mile in energy and routine servicing, but real savings vary with electricity costs, charging habits, and how much you rely on public fast chargers. Home charging at overnight rates generally delivers the best savings.
Q: How long do EV batteries last?
A: Most EV batteries are designed to last 8–10 years before significant degradation occurs, and many warranties reflect this. However, battery capacity does decline with age, and replacement can be expensive if not covered.
Q: Why is EV insurance more expensive?
A: Insurance premiums for electric cars can be higher due to costly parts (especially batteries), specialised repair requirements, and limited independent repair options.
Q: Do electric cars still save money over time?
A: In many cases, yes — especially if you charge at home, avoid frequent public charging, and plan for long-term ownership. But total cost of ownership should factor in all costs, not just fuel savings.
Q: What’s the biggest hidden cost of an EV?
A: Battery replacement and depreciation are often the most expensive hidden factors, followed by insurance, charging infrastructure, and energy pricing.
