Adopting electric vehicles or plug-in hybrids can lead to significant savings for organisations and cut carbon and nitrogen dioxide emissions.
It’s important to identify which of your fleet vehicles you can practically and cost-effectively replace with electric vehicles and think about your charging infrastructure requirements.
Energy Saving Trust offers fully-funded ultra low emission vehicle reviews, which provide analysis of your fleet and identify vehicles suitable for replacement, which generates associated financial and carbon savings.
Ultra low emission vehicles (ULEVs) emit zero or low tailpipe emissions. They include:
- pure or battery electric vehicles (EVs or BEVs)
- plug-in hybrid vehicles (PHEVs)
- range-extended electric vehicles (E-REVs)
- hydrogen fuel cell electric vehicles (FCEVs).
Currently, an ultra low emission vehicle (ULEV) is any vehicle that emits less than 75g/km of CO2. Recognising advancements in technology, from 2021, a ULEV will be a car or van that emits less than 50g CO2/km.
Hybrid electric vehicles (HEVs) are not ultra low emission vehicles and do not plug in to recharge. A hybrid electric vehicle has an internal combustion engine and a small battery, which is charged when the driver brakes, known as regenerative braking. The battery power either assists the engine or drives the wheels entirely for a very short distance (usually less than a mile). This reduces fuel consumption and emissions, particularly in stop-start driving conditions.
Find out more at about the types of ultra low emission vehicles and the models available at:
- electric vehicles explained
- a guide to ultra low emission vehicles for fleet managers
- Go Ultra Low (advice for consumers, funded by industry and government)
- OLEV Plug-in car and van grants – lists eligible vehicles
An electric vehicle’s range is how far it can travel before recharging. For a plug-in hybrid, the range is how far it can travel on battery power, before switching to the petrol engine (or very rarely the diesel engine).
Battery technology is developing quickly and the driving range on new ultra low emission vehicle models is increasing rapidly.
Typical ranges for the different vehicle types are:
- battery or pure electric vehicle: 100 to 300 miles, depending on the model
- plug-in hybrid: an electric-only range of 10 to 30 miles, and a total range of over 500 miles using the petrol or diesel engine
- range extended: around 150 miles on electric-only power, and a further 80 to 90 miles powered by electricity generated by the internal combustion engine However, E-REVs are less commonly available and are not currently in production by any major manufacturer (apart from the LEVC Taxi)
Ranges also vary depending on:
- how efficiently you drive – anticipating the road ahead and making full use of regenerative braking increases range
- how you heat or cool the car (preconditioning) – heating or cooling the car while plugged-in and using heated seats, rather than heating the cabin, increases range
- how fast you drive – driving at high speeds reduces range
- the vehicle’s payload – heavily loaded electric vehicles will have a shorter range.
For helpful tips, see our guide to efficient driving in electric cars and vehicles. We also subsidise ecodriving training in electric vehicles for businesses and the public sector in England only.
Ultra low emission vehicles (ULEVs) can be an excellent choice for businesses, both financially and environmentally. As well as much lower fuel costs, there are various grants and tax incentives for electric cars and vans, which enhance the business case. Pool cars, company cars and vans can all potentially be replaced with ULEVs.
We offer fully-funded fleet reviews, which offer analysis of your fleet and provide whole-life cost analysis for suitable models and estimated savings.
Whole life cost modelling
ULEVs cost more than their petrol or diesel equivalents to buy or lease, but whole life cost (WLC) analysis shows that they can be cheaper on a pence-per-mile basis.
Whole life cost modelling includes aspects such as fuel, maintenance and National Insurance contributions in addition to the on-the-road purchase or lease price.
For examples, see our Guide to ultra low emission vehicles for fleet managers.
For information about electric vans, see the our guide to reducing van emissions and costs.
As electricity is cheaper than petrol or diesel, ultra low emission vehicles are cheaper to run. Electric cars typically cost £2 – £4 to fully charge, for a range of 100 miles. An equivalent petrol or diesel car costs £13 – £16 to drive 100 miles – approximately four times the cost.
To offset the higher purchase cost or lease cost, an electric car or plug-in hybrid must cover sufficient miles for the fuel savings to add up. The break-even mileage varies but can be 30 – 80 miles a day, depending on the vehicle price, how long it is kept on fleet, electricity costs and if there are additional incentives, such as the London congestion charge cleaner vehicle discount.
Pure electric vehicles are usually cheaper to service and maintain compared to equivalent vehicles with internal combustion engines, including plug-in hybrids. This is because they have fewer service requirements, such as oils and filters.
Regenerative braking recharges the battery using the vehicle’s kinetic energy when slowing down. It reduces wear and tear on the standard friction brakes, extending their life and reducing replacement costs.
Grants and tax incentives
The Office for Low Emission Vehicles (OLEV) offers grants and tax incentives. The UK Government’s Road to Zero strategy confirmed these will continue to be available in some form until 2022.
Grants available across the UK include:
- Plug-in car grant – reduces purchase prices for eligible pure electric cars by £3,000 (up to £50,000 purchase price)
- Plug-in van grant – reduces purchase prices by £8,000 for eligible vehicles
- Plug-in taxi grant – grant will pay up to 20% of the purchase price, up to £7,500
- Workplace charging scheme – up to £350 per charging socket up to 40 sockets
- EV home charge scheme – up £350 for installing a chargepoint at home, if the driver has off-street parking
In addition, there are tax benefits for ultra low emission vehicles, as summarised below:
- lower or zero vehicle excise duty (VED), see gov.uk
- lower company car tax (see our company car guide)
- no fuel benefit charge and no benefit in kind liability for electricity provided by an employer to charge employees’ own electric vehicles (since April 2018)
- businesses buying cars can write down 100% of the purchase price against their corporation tax liability if the vehicle emits no more 50g/km CO2 (2020/21 tax year)
- enhanced capital allowances when investing in ultra low emission vehicles or charging infrastructure
- zero emission vans are eligible for the Plug-in Van Grant or the First Year Allowance, and drivers pay a proportion of the van benefit charge (80% in 2020/21)
- advisory electricity rate – pure electric company car drivers can claim 4p/mile (from September 2018) for business use
Ultra low emission vehicles will also be compliant with clean air zone standards and are entitled to a 100% discount on the London congestion charge (cleaner vehicle discount, see TfL for details).
When driven on electric power, ULEVs emit zero tailpipe carbon dioxide emissions. Whilst the vehicles are only as green as the electricity supply, vehicles charging from the UK’s National Grid emit considerably less carbon dioxide per mile than petrol or diesel models.
For example, a battery electric car is estimated to have greenhouse gas emissions around 66% lower than a petrol car and 60% lower than a diesel car. Between now and 2050, projections show that electricity grid emissions will fall by around 90%, with total greenhouse gas emissions from electric vehicles falling in parallel (Source: Road to Zero).
Even considering the emissions associated with manufacturing, electric cars and vans are less environmentally damaging than internal combustion engine models, and can help organisations meet corporate social responsibility (CSR) objectives.
Additionally, ultra low emission vehicles produce little or no air pollutants such as nitrogen dioxide, improving air quality. ULEVs are also quieter than conventional vehicles.
A vehicle’s daily mileage influences which type of ultra low emission vehicles would be a suitable replacement, and determines the cost effectiveness of switching.
If you don’t have good data on your fleet, see Managing mileage which explains how to record this.
Optimal mileages for ULEVs
Most battery electric vehicles currently have driving ranges between 100 and 300 miles and so can easily manage local journeys and delivery and service routes, which account for the majority of journeys. In order for fuel savings to offset their higher purchase costs, battery EVs are best suited to vehicles covering more than 30 miles a day, depending on the real world driving range of the vehicle. The higher the daily mileage, the greater the savings achieved.
It’s worth noting that electric vehicles with heavy payloads, or being driven at speed on motorways, will have a significantly shorter driving range than those lightly laden or driven at lower speeds.
For drivers regularly undertaking longer journeys, a plug-in hybrid or extended-range electric vehicle will be more suitable. However, plug-in hybrid vehicles are only efficient if they are regularly charged, otherwise they can be more expensive to run than a conventional petrol or diesel vehicle.
Also see our guide on Reducing van emissions and costs.
Support to review your fleet
We offer fully-funded fleet reviews for businesses, public sector and non-profit organisations, funded by the Department for Transport. A fleet review will analyse your fleet, identify which vehicles could be switched to ultra low emission vehicles and offer whole-life cost analysis on suitable ULEV models.
In Scotland, our free sustainable transport review service, funded by Transport Scotland, helps organisations in Scotland become more efficient with their transport and travel arrangements. We also offer a grey fleet review for businesses, which could help you achieve significant cost and carbon savings.
Electric vehicles are likely to need to return to base to recharge overnight. It may not be necessary to recharge all your vehicles every day, depending on the distance driven. But it’s essential to install suitable charging infrastructure, to ensure that any new ULEVs can fully meet business needs and are convenient and cost-effective to drive.
To install chargepoints, you need access to off-street parking at your workplace. Not every site is suitable as there may be issues with grid capacity constraints, especially if you plan to rapidly charge many vehicles, at the same time.
It’s also possible to install chargepoints at employees’ homes, such as for company car drivers or where vans are taken home overnight. For example, Leeds City Council took this approach to overcome grid constraints at several depots.
Our Guide to chargepoint infrastructure for businesses is the best place to start. It offers a comprehensive overview of charging infrastructure technologies, what to consider, and the grants available.
In Scotland, Transport Scotland has made grant funding available to help organisations install electric vehicle charging infrastructure on their premises. Business charge point funding is currently available for charge points for sole use by occupiers, staff and visitors.
Allowing employees to recharge at their workplace is a new situation for many organisations. Have a look at this template electric vehicle charging policy to think through your options and adapt it to suit your situation and processes.
UK EVSE Procurement Guidance goes into more detail, with many practical tips.
Hydrogen fuel cell electric vehicles (FCEVs) have zero harmful tailpipe emissions (just water) and offer two main advantages over electric vehicles:
- fast refuelling (typically 5 minutes)
- longer ranges (typically over 300 miles)
There are 13 hydrogen refuelling stations available for public use in the UK but plans for more. Hydrogen is likely to be most suitable for larger cars, fleets with HGVs, buses and large vans.
Accounting for the carbon emission of energy production, hydrogen fuel cell electric vehicles deliver greenhouse gas emissions savings of 10%, compared with a diesel HGV, to 43%, compared with a petrol car (Source: Road to Zero strategy).
CNG and LPG are also options but there is a limited supply of these vehicles. Leeds City Council are using CNG vans and refuse collection vehicles.