‘My car will have paid itself off’: How these Aussies save $10,000 a year driving an EV

Niklas Hemstrom is saving $10,000 a year driving an electric vehicle compared to his previous petrol hatchback.

Monday to Friday, the Victorian 57-year-old does about 200km a day in his job as a ride-share driver. When he owned a petrol Hyundai i30, he was spending $200 a week on petrol – long before petrol prices hit $2.20 a litre.

After Hemstrom purchased a BYD Atto 3 small SUV and installed an EV wallbox for home recharging, within a month his fuel bill had dropped to $25.

“One thing that used to annoy me, Ubering in a petrol car, I’d have to stop at least four times a week for petrol,” Hemstrom told Drive.

“With this EV, it goes all day, I get home and plug it in. It’s got better acceleration, it’s got the app that turns on the air-conditioning or heater from inside your house.”

As a ride-share driver, Hemstrom covers about 50,000km a year – more than three times the average Australian – making his EV use-case an extreme example. But he’s part of an emerging group of everyday EV owners evangelistic and even surprised at how much money they’re saving as a cost-of-living crisis worsens and interest rates rise. Especially given it’s a technology that still has many Australians unsure.

With nearly 50,000 members, Drive posted a call-out to the Electric Vehicles For Australia Facebook group for owners who have money-saving stories to tell. We had more than 100 responses.

Living regionally, Patrick Baume owns a Hyundai Ioniq 6 and Polestar 2 and drives about 30,000km each year. With solar and a home battery, he said charging “literally costs me nothing”. “My old, efficient diesel did six litres per 100km so that would be $3600 a year at $2 a litre (or $4800 at current prices),” said Baume.

For many Australian EV owners, generally, the more kilometres you do each week, the more the savings add up. The other piece of the EV-savings puzzle is being able to recharge at home.

A year ago, when Victorian Paul Tyler’s daily commute increased from 25km to 138km, he found himself spending $20 a day just in petrol, when prices were about $1.80/litre. Tyler decided to purchase a BYD Dolphin small hatchback.

“I purchased an EV because my second car blew an engine and was more expensive to repair than it was worth,” Tyler told Drive.

At 15kWh/100km, the Dolphin uses 20.7kWh for the same commute. Recharged at home with an 8c/kWh off-peak EV plan, “it now costs me $1.65 for the same commute”.

“If petrol had stayed at around $1.80, my savings were $18.22 a day. It’s now $2.40/L, so the saving is about $25 a day,” he said.

“At $20 a day, $100 a week, $5200 a year, the car, which cost $29,000, will have paid for itself in about five years, after which the car cost the same as the petrol I would have spent – and was essentially free. Every 100km after that costs $1.20.”

“You can’t make this stuff up. I still pinch myself some days that it’s true.”

If you commute to an office a few days a week, the biggest money-saving ‘hack’ owning an EV might be finding a power point you can plug into at work – and an accommodating boss. That could mean you leave the work car park every day with a ‘full tank’ of 500km, for ‘free’.

The next best thing is home solar, said many EV owners. One in three Australian homes now has rooftop solar, and for many Aussies, pairing their electric vehicle with a home solar set-up remains the holy grail of savings, once the solar hardware and installation had paid itself off.

If you don’t have home 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 – and most EVs will allow you to schedule overnight recharging in the vehicle’s infotainment system, or via an app.

In addition to charging their car, some EV owners will schedule their washing machines, dryers and dishwashers to come on after midnight. Or pair an EV electricity plan with a home battery.

There is a catch, however – these plans can come with higher per-day ‘service charges’ and higher rates at all other times, so it’s worth checking them carefully. “The true summer rate [for ours] would be closer to 25c/kWh and winter, let’s assume full price, so my average would be about 33c/kWh,” said Tyler.

Many Australian EV owners drive their vehicles on a novated lease through their employer, taking advantage of the Australian government’s current Fringe Benefits Tax exemption for new electric vehicles valued up to $91,387. You also save on upfront GST and, along with cheaper running costs, you can use your car to lower your taxable income, potentially saving thousands of dollars in tax – especially if you’re in a higher tax bracket.

If your employer and novated lease provider allow the leasing of second-hand EVs, by starting with a lower upfront purchase price, the savings can be greater again. The EV needs to be newer than July 1, 2022.

With novated leases, it pays to read the fine print, do your own research and crunch the numbers for your specific financial circumstances.

Despite saving money on petrol, like many EV owners, Hemstrom is cautious about what his vehicle might be worth after several years of ownership.

“I think it’s a bit of an unknown market because of how quickly the technology with the batteries and the resale value is going,” he said. “No-one really, actually knows. I’m prepared for worst-case scenario, maybe young people who want an EV instead of a petrol car and don’t have much money.”

Hemstrom said he had owned his BYD Atto 3 for two and a half years and intends to keep it for seven years. At that stage, while he may have completed 350,000km, he could have saved $60,000 to $70,000 in petrol. In 2023, a BYD Atto 3 Extended Range was $51,011 brand new.

He said he will never go back to a petrol car. “No, no chance,” said Hemstrom. “Why would I? It’s so much cheaper to run.”

How much has an EV saved your family, and do you have a money-saving story to share? Let us know in the comments below.

Dylan Campbell has been road-testing and writing about cars and the new-car industry since 2006. An independent motoring expert based in Melbourne, Dylan is a former Editor of Wheels Magazine, MOTOR Magazine and the TopGear Australia website.

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