The Rise of Electric Vehicles in Australia
With the cost of living on the rise, more Australians are turning to electric vehicles (EVs) as a way to save thousands of dollars each year. This shift is not just about environmental concerns but also about practical financial benefits. Here’s how you could potentially save money too.
Niklas Hemstrom, a 57-year-old from Victoria, is saving $10,000 annually by driving an electric vehicle instead of his previous petrol-powered Hyundai i30. He drives around 200km daily for his ride-share job. Previously, he spent $200 a week on fuel, even before prices reached $2.20 per litre. After switching to a BYD Atto 3 and installing a home EV wallbox, his fuel costs dropped to $25 within a month.
“Before, I had to stop at least four times a week for petrol,” Hemstrom shared. “Now, it goes all day, and I plug it in when I get home. It has better acceleration and an app that lets me control the air conditioning or heater from inside my house.”
As a ride-share driver, Hemstrom covers about 50,000km a year—more than three times the average Australian. His experience highlights how EVs can be beneficial for those with high mileage. However, he is part of a growing group of everyday EV owners who are amazed by their savings as the cost-of-living crisis intensifies and interest rates climb.
From $2 per Litre to Fuel That Costs ‘Literally Nothing’
With nearly 50,000 members, a community forum called Electric Vehicles For Australia posted a call-out for owners with money-saving stories. They received over 100 responses.
Patrick Baume, who lives regionally, owns a Hyundai Ioniq 6 and a Polestar 2, covering around 30,000km each year. With solar power and a home battery, he claims charging his EV “literally costs me nothing.”
“My old diesel car used six litres per 100km, which would have been $3,600 a year at $2 a litre (or $4,800 at current prices),” Baume said.
‘My Car Will Have Paid Itself Off in Five Years’
For many Australian EV owners, the more kilometres you drive, the more savings you accumulate. Another key factor is being able to recharge at home.
Paul Tyler, from Victoria, found himself spending $20 a day on petrol when prices were around $1.80 per litre. After his second car broke down, he decided to buy a BYD Dolphin.
“At 15kWh/100km, the Dolphin uses 20.7kWh for the same commute. Recharged at home with an 8c/kWh off-peak plan, it now costs me $1.65 for the same commute,” Tyler explained.
“If petrol had stayed at around $1.80, my savings were $18.22 a day. Now that it’s $2.40/L, the saving is about $25 a day. At $20 a day, $100 a week, $5,200 a year, the car, which cost $29,000, will have paid for itself in about five years. After that, it’s essentially free.”
Money-Saving Tricks of Aussie EV Owners
If you commute to an office a few days a week, one of the biggest money-saving hacks is finding a power point at work to charge your car. This means leaving the work car park every day with a full tank of 500km for free.
Home solar is another popular option. One in three Australian homes now has rooftop solar, and for many, pairing an EV with a solar setup is the ultimate savings strategy once the initial investment pays off.
If you don’t have solar or can’t install it, some energy providers offer EV electricity plans with off-peak rates as low as 4c/kWh between midnight and 6am. Most EVs allow you to schedule overnight recharging via the infotainment system or an app.
Some EV owners also use these plans to run appliances like washing machines, dryers, and dishwashers after midnight. Pairing an EV plan with a home battery can further maximize savings.
However, there is a catch. These plans often come with higher service charges and higher rates outside of off-peak hours. It’s important to check the details carefully.
Novated Leases: A Tax-Saving Opportunity
Many Australian EV owners lease their vehicles through a novated lease with their employer, taking advantage of the government’s Fringe Benefits Tax exemption for new electric vehicles valued up to $91,387. This allows them to save on upfront GST and potentially reduce their taxable income, leading to significant tax savings.
If your employer and leasing provider allow the leasing of second-hand EVs, starting with a lower purchase price can lead to greater savings. The EV must be newer than July 1, 2022.
It’s crucial to read the fine print and do your own research to ensure this option fits your financial situation.
EV Depreciation Still an Unknown
Despite the savings on fuel, many EV owners remain cautious about resale value. Hemstrom, who has owned his BYD Atto 3 for two and a half years, is unsure about its future value.
“I think it’s an unknown market because of how quickly technology changes, especially with batteries and resale values,” he said. “I’m prepared for the worst case, maybe younger people who want an EV but don’t have much money.”
Hemstrom plans to keep his vehicle for seven years, during which he may have saved $60,000 to $70,000 in fuel costs. He says he will never go back to a petrol car.
“How could I? It’s so much cheaper to run.”
Have you saved money by driving an EV? Share your story in the comments below.
