AllCosts report
Solving the plug-in hybrid Puzzle
Published February 2025
Originally went live December 2024
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Driving PHEVs could result in cost savings so long as drivers use the right powertrain, at the right time. Here’s how you can do it.
It was reported in August 2024, sales of plug-in hybrids have increased by nearly a third compared to 2023, with fleet buyers increasingly opting for these models.
There may be many different reasons for this.
Some company car drivers might not be convinced that they’re ready to go fully electric, and think that the short battery range of a PHEV will be acceptable for most miles, with the back-up of petrol or diesel when they need it on longer trips.
Others may be coming out of ICE company cars and see a tax saving from a PHEV, as the Benefit-in-Kind rate for plug in hybrids is lower than that of petrol or diesel and set to last until 2028.
As technology has improved, the battery range of PHEVs has increased too, with some models claiming to deliver around 70 miles before the petrol or diesel engine is needed. Not long ago, getting 30 electric miles from a PHEV would have been an achievement.
So for the right driver, PHEVs could work.
However, some fleet management companies have found that many drivers, once they accessed the lower company car tax rates, don’t actually use the electric drivetrain at all.
So fleets need to be aware of this in order to get the most from them, and to ensure they are not paying more than they should or could be.
We’ve looked at some scenarios, based on our real-life costs, to show how using PHEVs in the right way could save a business money.
Scenario 1: Charges at home and uses electric every day
If this driver charges at home every night, at 24p per kWh, 49 of their 55 miles would cost them £4.66. The other six miles, using the petrol engine at an average of 41.3 mpg would cost 95p, for a total of £5.61. Driving this way, over a year (5 days a week, 45 weeks a year) their cost for business mileage would be £1,262.
Scenario 2: Charge in public and uses electric every day
If this driver doesn’t have a home charger and uses high speed public units at 78p per kWh, the cost of filling the battery each time would cost £15.91, and with the extra petrol-powered mileage ends up at £16.86 a day, costing £3,794 per year.
Scenario 3: Never uses electric - only petrol engine
If a PHEV driver never uses the electric powertrain, and just runs on the petrol engine alone, the cost of those 55 miles at 41.3mpg would be £8.77 a day. Over the entire year, that’s £1,973 in total – costing the business over £700 more in mileage expenses than if they had taken advantage of charging at home.
How Allstar can help
These figures show that from a cost perspective, it’s really important to maximise every electric mile you can in a PHEV, and charge in the right way, otherwise bills can spiral.
With Allstar Online, you can see what a driver with an Allstar Chargepass card is paying for – whether it be petrol, diesel or electric – which means you can identify those not taking advantage of potentially cheaper electric charging costs, if available to them, and demonstrate to them the savings that could be made.
For business drivers who do have the option to charge at home but don’t currently, Allstar Homecharge makes expenses easier and helps save costs through the most economical way to pay for business electric charging.
Allstar Homecharge makes expenses easier and helps save costs.
We can also supply a driver survey to the business to help identify those employees who are suitable for Homecharge.
Using the Allstar Co-Pilot app, drivers can also search for cheaper fuel and electricity on the road too, so they can maximise the efficiency of their PHEV, whichever powertrain they are running.
AllCosts report
Solving the plug-in hybrid Puzzle
Share article
Driving PHEVs could result in cost savings so long as drivers use the right powertrain, at the right time. Here’s how you can do it.
It was reported in August 2024, sales of plug-in hybrids have increased by nearly a third compared to 2023, with fleet buyers increasingly opting for these models.
There may be many different reasons for this.
Some company car drivers might not be convinced that they’re ready to go fully electric, and think that the short battery range of a PHEV will be acceptable for most miles, with the back-up of petrol or diesel when they need it on longer trips.
Others may be coming out of ICE company cars and see a tax saving from a PHEV, as the Benefit-in-Kind rate for plug in hybrids is lower than that of petrol or diesel and set to last until 2028.
As technology has improved, the battery range of PHEVs has increased too, with some models claiming to deliver around 70 miles before the petrol or diesel engine is needed. Not long ago, getting 30 electric miles from a PHEV would have been an achievement.
So for the right driver, PHEVs could work.
However, some fleet management companies have found that many drivers, once they accessed the lower company car tax rates, don’t actually use the electric drivetrain at all.
So fleets need to be aware of this in order to get the most from them, and to ensure they are not paying more than they should or could be.
We’ve looked at some scenarios, based on our real-life costs, to show how using PHEVs in the right way could save a business money.
Scenario 1: Charges at home and uses electric every day
If this driver charges at home every night, at 24p per kWh, 49 of their 55 miles would cost them £4.66. The other six miles, using the petrol engine at an average of 41.3 mpg would cost 95p, for a total of £5.61. Driving this way, over a year (5 days a week, 45 weeks a year) their cost for business mileage would be £1,262.
Scenario 2: Charge in public and uses electric every day
If this driver doesn’t have a home charger and uses high speed public units at 78p per kWh, the cost of filling the battery each time would cost £15.91, and with the extra petrol-powered mileage ends up at £16.86 a day, costing £3,794 per year.
Scenario 3: Never uses electric - only petrol engine
If a PHEV driver never uses the electric powertrain, and just runs on the petrol engine alone, the cost of those 55 miles at 41.3mpg would be £8.77 a day. Over the entire year, that’s £1,973 in total – costing the business over £700 more in mileage expenses than if they had taken advantage of charging at home.
How Allstar can help
These figures show that from a cost perspective, it’s really important to maximise every electric mile you can in a PHEV, and charge in the right way, otherwise bills can spiral.
With Allstar Online, you can see what a driver with an Allstar Chargepass card is paying for – whether it be petrol, diesel or electric – which means you can identify those not taking advantage of potentially cheaper electric charging costs, if available to them, and demonstrate to them the savings that could be made.
For business drivers who do have the option to charge at home but don’t currently, Allstar Homecharge makes expenses easier and helps save costs through the most economical way to pay for business electric charging.
Allstar Homecharge makes expenses easier and helps save costs.
We can also supply a driver survey to the business to help identify those employees who are suitable for Homecharge.
Using the Allstar Co-Pilot app, drivers can also search for cheaper fuel and electricity on the road too, so they can maximise the efficiency of their PHEV, whichever powertrain they are running
Allstar Business Solutions Limited, Canberra House, Lydiard Fields, Swindon Wiltshire, SN5 6PS.
T: 0118 867 2673
www.allstarcard.co.uk
www.allstarcard.co.uk
Allstar Business Solutions Limited, Canberra House, Lydiard Fields, Swindon Wiltshire, SN5 8UB.
T: 0118 867 2673
www.allstarcard.co.uk
www.allstarcard.co.uk