As we invest further into alternative fuel sources for our vehicles, with battery electric vans now added to our fleets in Dublin and Frankfurt, I wanted to share some background research that may encourage others to consider phasing out diesel.
While our primary goal of acquiring these vans is to support the environment, there are also several incentives available to companies that reduce the cost of ownership and encourage this move to electric.
For this blog, we are detailing the main incentives we have observed in Ireland and Germany, where our first electric vans will be based.
- Across Europe, electric vehicle drivers will enjoy a 50% discount in toll fees coming into play by 2023. This will dramatically reduce company overheads and spur more companies and households to switch from petrol and diesel engines.
- SEAI.ie explain that companies purchasing Electric Vehicles in Ireland will “qualify for a 0% Benefit-in-Kind rate on the first €50,000 of the vehicle value without any mileage conditions.
- Additionally, In Ireland, any company that pays Corporation tax can deduct the total cost of the Electrical Charger Equipment from their profits in the year of purchase. The reduction in tax paid by the organisation in that year is currently 12.5% of the value of capital expenditure.
- Over in Germany, state-owned KfW bank provides up to €900 per charging point for purchasing and installing an EV charger.
- Those in Germany can also benefit from a 10-year tax exemption on electric vehicles, and the motor tax in Ireland is at its lowest band of €120 per year.
- We calculated that over five years, the cost to service an electric van on average would be €600, with the battery only needing replacement in its 10th year. This compares to an average spend of under €5,000 on a diesel engine van over five years.
- In Germany, a roadworthiness test must be performed on every car registered three years after it is first registered and then every two years. These tests include an emissions check, and the average cost is €65 – similar to the Irish NCT.
- Over five years, it will cost between €7,000 and €8,000 to drive 400KM at 77Kwh compared to just under €40K for a diesel engine.
Moving Together in the Right Direction:
While writing this blog, it was encouraging to read that the government’s Commercial Fleet trial is fully booked in Ireland. This trial allows businesses to test out Electric Vehicles for three months, free of charge, to “show, through real-world evidence, the benefits, savings and the suitability and viability of EVs in a commercial setting”.
Furthermore, across Europe, the uptake of electric vehicles, in general, appears to be making steady progress, with the Irish Examiner stating that 25% of vehicles bought in Germany and 21% in The Netherlands are using electricity. At the same time, most cars registered in Norway since 2020 are powered by alternative fuels to petrol and diesel.
While the upfront cost is significant, there is no doubt that the investment in electric vehicles will be recovered through government incentives and overall savings in running costs. More importantly, they are the way forward to lowering emissions.