How much will you actually save with an electric vehicle in 2026?
EVs can be cheaper to run and maintain, so it’s important to consider total cost of ownership, not just the upfront price.
Key takeaways
- Australians can potentially save over $1000 annually on fuel costs by switching to an electric vehicle.
- Electric cars often incur lower maintenance costs compared to petrol cars due to fewer moving parts.
- Be aware of potential EV battery replacement costs, which can range from $10000 to $20000 out of warranty.
Electric vehicle (EV) sales have been on the rise for a while, but soaring fuel prices have really kicked demand into high gear this year.
In fact, EVs reached their highest share of car sales in March 2026, making up 14.6% of all vehicles sold.
With more makes and models in the market now, the upfront cost isn't as high as you might think.
The four-seater BYD Atto 1 has a starting price of around $24,000. For comparison, the popular Tesla Model Y starts at approximately $59,000.
But is it actually cheaper when you factor in how and where you drive, purchase price, insurance and other ad-hoc costs such as installing a charger at home?
Driving costs: Petrol vs charging
The biggest saving comes from how you "refuel", with EVs being up to 70% cheaper to run.
According to the Electric Vehicle Council (EVC), the average Australian drives around 12,000km per year and spends about $2,500 on petrol.
An EV covering the same distance would cost roughly $500 to charge (around $0.04 per km), or even less with off-peak charging at home (more on that in just a second).
Charging at a public station will generally cost more - it's the price of convenience.
Did you know?
You might pay around 25 to 40 cents per kWh at shopping centres and street parking, or as much as 40 to 65 cents per kWh for fast chargers along highways. On the flipside, home charging typically ranges from 20 to 35 cents per kWh. However, if you have solar panels and are on an electricity plan with a competitive off-peak rate, you could pay as little as 8 cents per kWh.
Long story short, it all comes down to a few key factors:
- What you pay for electricity at home, including whether you're on off-peak rates
- Whether you mostly charge at home or rely on more expensive public chargers
- If you have solar panels, which can significantly reduce your charging costs
- How much you drive each year and your EV's energy consumption (kWh/100km)
The cost of installing a charger at home
If you own your home and can install an EV charger, you're likely to get the most out of owning an EV, especially when it comes to "refuel" savings.
While you can use a standard household power point, this is generally quite slow, around 1 to 4km per 10 minutes.
A dedicated wall charger is a better option, typically $1,000 to $2,000 plus installation.
EV maintenance costs: What you stop paying for
It's hard to put an exact number on EV maintenance savings, but they're generally lower by about 40%.
There's less that can go wrong, and servicing tends to be cheaper too.
Compared to petrol cars, EVs are also more efficient in city driving.
They convert energy to movement more effectively - especially from a standstill - and regenerative braking helps slow the car while topping up the battery.
Research by the EVC says that drivers of some EV models have estimated savings between $300 to $400 every year in maintenance costs compared to equivalent petrol or diesel cars.
Is EV insurance more expensive?
EV insurance can be more expensive due to the way the vehicles are built and repaired.
However, the price difference compared to regular petrol or diesel car insurance isn't as big as you'd expect.
It'll depend on the make and model of your EV, as well as factors like your driving history, where you live and how the car is used.
To get the best deal, it's worth shopping around and comparing quotes from multiple insurers.
Verdict: Is it worth switching to an EV?
It's worth considering an EV if you drive more than 10,000-15,000km per year and can charge at home, ideally with solar.
Or if you've researched public charging options where you live and they're convenient.
You can check out our guide to novated leasing for EVs if you're nervous about upfront costs.
However, an EV might be a "wait and see" investment if you live in an apartment with no nearby charging access and/or only drive a few thousand kilometres a year. The fuel savings won't be enough to offset the higher insurance and purchase price.
Keep in mind that while public charging networks are expanding across the country, you still need to plan your route carefully when taking long road trips.
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If you assume for this query that electric power is generated from fossil fueled power stations what is the emissions difference between an electric car and a petrol driven car of approx equal energy ratings given the high cost of electric power in Australia (without referencing discount offers)
Hi Johnboy,
Thanks for your inquiry.
To compare emissions, gas cars emit 157 pounds of CO2 per million BTUs of energy consumed, electric cars emit 65% of 117 pounds or about 76 pounds of CO2 per million BTUs of energy consumed (because the electric cars are powered 65% by CO2-emitting fuel). Therefore, even considering the emissions from the fossil fuels plants that generate electricity for their batteries, gas cars emit at least twice as much CO2 as electric cars (157 divided by 76).
Hope this helps.
Cheers,
Rench
Just a correction. Although Australia is one of the worst places in the world to buy an electric vehicle*, there are still some incentives e.g. they are stamp duty exempt in the ACT and there are concessions in the luxury vehicle tax from the Commonwealth. Victoria also offers a $100 discount on registration for hybrid/electric cars. So there are no incentives on the actual purchase price but there are a few crumbs here and there if you know where to look.