How Cost-Effective Is Electric Van Leasing?

08/05/2022

How Cost-Effective Is Electric Van Leasing?

Electric cars are everywhere at the moment. Every day you see more on the roads and hear about new developments and technology in the news. But while electric vehicles are popular for business and personal use, one big question still hovers above electric vans. Are they efficient and economical enough to rival petrol and diesel vans for businesses?

Electric vans are becoming more and more popular as people look for ways to save money on their business expenses. In 2021, there was a 142% increase in the number of new battery-electric vans (BEV) on roads. But while some businesses are opting for a middle ground with plug-in hybrid vans, many choose fully electric vans like the Nissan e NV200.

Most major manufacturers now offer at least one fully electric van. Mercedes, Nissan, Renault and Volkswagen all have electric van ranges. So whether you're looking for a new panel van, pickup or something a bit bigger for your business, there's bound to be an electric van lease to suit your needs. But is electric van leasing a cost-effective option? Check out our breakdown of the running costs of electric vans to find out.

The Running Costs of Electric Vans

If you're a business owner, you're probably constantly looking for ways to save money. With increasing fuel prices, you might be considering an electric van. Electric vans are popular in the "last mile" delivery sector. But many electric vans are now also suitable for various trades and industries. If you're on the fence about making the switch, here's a rundown of the costs of going electric.

Initial Cost — Leasing an Electric Van

One potential roadblock for electric vans is that they're currently more expensive than diesel or petrol vans. As the EV market is still developing, manufacturing costs are higher, which gets passed on to buyers. But one of the best ways to avoid this is to lease an electric van. Van leasing gives you all the benefits of an EV without the initial expense of buying.

If we look at the Toyota Proace City Electric van, the purchase price starts at £31,760. But the diesel Toyota Proace starts at £24,510. That's quite a difference in price that might be off-putting for business owners. While the monthly leasing costs of an EV are slightly higher than a diesel van, most leases start at around £300 a month. Diesel van leases start between £200 and £250. As you can see, the difference is marginal — especially when you consider road tax exemption for EVs.

Ongoing Cost — Electric Van Charging Costs

While the monthly leasing costs for an electric van may be slightly higher, the cost of charging an EV is much less than a petrol or diesel van. The cost of charging an electric van will change depending on the battery capacity and electric motor of your EV, your mileage and where you charge it.

To give you an example of charging costs, we'll use the Renault Kangoo ZE, home charging costs and the UK average annual van miles of 13,000 miles. It's important to note that our calculations use the current average energy tariffs of £0.28 per kWh, which is subject to change. Ready for some maths?

You'll first need to divide your mileage by 52 weeks to work out charging costs. For the average driver, that works out as 250 miles a week. The Renault Kangoo ZE has a maximum driving range of 170 miles and a 33kWh battery. Here's how to calculate the cost of a full charge:

£0.28 X 33kWh = £9.24.

To work out your weekly charging costs, you'll need to know your cost per mile. You can do the following calculations to work out both:

£9.24 / 170 miles = £0.054 per mile.

£0.054 X 250 miles = £13.59.

To understand the savings you can make, we need to compare that with the cost of a diesel van with the current price of 177.31 pence per litre. The diesel Renault Kangoo is capable of 65.7 mpg, which works out at £6.69 for 65.7 miles. For the same distance in a diesel vehicle, the cost of diesel is £25.46 — almost double the electric charging cost. Here are the costs for electric charging and diesel over a year:

Electric — £706.68.

Diesel — £1,323.92.

That's a saving of over £600 a year. Plus, with at-home rapid charging capability and zero emissions, electric cars are quick to charge and better for the environment.

Ongoing Costs — Maintenance for Electric Vans

Another area where electric vans trump traditional ones is maintenance. Electric vehicles have far fewer moving parts than internal combustion vehicles, which means there's far less that can go wrong. Research shows that maintenance costs for EVs are up to 50% cheaper as there are fewer parts that can break and need replacing.

The biggest maintenance issue with electric vans is the cost of a new battery pack. As EVs have one big battery, it can cost a pretty penny if the battery goes wrong. Rough estimates for a replacement battery are around £10,000. But the good news is that EV batteries have an average lifespan of 100,000 to 150,000 miles. Plus, most manufacturers offer lengthy warranties, so it’s usually covered if something does go wrong.

Due to having fewer parts, servicing an electric van is also cheaper than a petrol or diesel vehicle as there is less to check. Alongside this, EVs have regenerative brakes, which are more efficient and need replacing less often.

One of the significant benefits of leasing an electric van over buying one is that you can add a small maintenance package to your lease. Maintenance packages are usually a small extra monthly fee covering any maintenance and repairs during your lease.

Incentives — Plug-in Van Grant, Road Tax & Congestion Charge

Alongside the lower running costs of an electric van, plenty of government incentives are available to lower costs further. Two of the most prominent incentives are the plug-in van grant that helps drivers to buy electric cars and a grant to install a home charging point. While the plug-in van grant does help lower the cost of purchasing a new electric van, most dealers display prices with the grant already deducted.

Two other incentives make driving an electric van much cheaper: exemption from road tax and the congestion charge. As EVs are zero-emission and don't contribute to local air pollution, drivers don't pay road tax or congestion charges currently. The cost of road tax for all fuel-based vans is £275, so it's another significant saving.

Find Electric Van Leasing Deals Today

At Tilsun Leasing, we have an extensive range of the best electric vans to lease. We've designed our leases to suit businesses of all sizes. If you're looking for small electric vans, we'd recommend looking at the Nissan e NV200, Renault Zoe van or the Citroen e-Berlingo.

But if you're looking for large electric vans, we'd recommend lease deals for the Maxus E Deliver, Mercedes Benz E-Sprinter or the Fiat E-Ducato. Our electric van lease deals are available with additional maintenance packages and have a range of annual mileages and terms.

Find the perfect electric van for your business in our range of electric van leases today. Get in touch with our team if you're looking for a bespoke lease or have any questions about electric van leasing. Call us today on 03330 040 888 or email [email protected].

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