74% of fleets looking for EV charging payment solution
The complexity of reimbursing company car and van drivers accurately for the cost of recharging their electric vehicles has prompted 74% of fleets to seek a payment solution in the next 12 months, according to a new survey.
The research questioned 200 fleet decision makers in the UK, and found that just over half (55%) use a government-approved flat rate mileage fee to pay drivers for EV journeys.
But a fixed rate will never be fit for purpose, said Ashley Tate, CEO and Co-Founder of Mina, the EV charging payment solution specialist, which conducted the survey jointly with 360 Media Group. Not only do domestic energy tariffs vary enormously – Mina has tracked 370 tariff increases in the past three months during the energy crisis – but the energy consumption of EVs differs considerably. Plus, each EV driver has a different ratio of home and public charging, with electricity prices ranging from as little as €0.06 per kWh at the cheapest overnight, domestic tariff to almost €0.80 per kWh on the motorway.
25% increase in official EV mileage rates
At the start of December the UK raised its official Advisory Electricity Rate (AER) that employers can use for the tax-free reimbursement of business miles by 25%, from 4 pence to 5 pence per mile (€0.04/km), but the new figure still grossly underestimates the true cost of electricity, according to the Association of Fleet Professionals (AFP).
The association has published tables, based on data generated by TMC, that shows the average pence per mile electricity cost for an electric van is actually 7.8ppm (€0.057/km), and rises to as much as 15.7ppm (€0.12/km) for the largest vans. This means that a van driver covering the average 13,000 miles per year would be short-changed by at least £346 (€407) per year [13,000 x (7.8-5)] or, with the figure likely to be much higher as energy prices continue to increase.
The problem is just as acute for company car drivers, with well below half of electric cars capable of operating at 5ppm (€0.04/km), when energy prices were 25% lower in the spring.
“Relying on the AER means many employers are underpaying their drivers without even realising,” said Tate.
Over a third (35%) of fleet decision makers are attempting to calculate their own EV mileage reimbursement rates; a complex and potentially risky process.
“Over-paying drivers for EV business miles erodes the savings from running EVs,” said Tate.
Mina Homecharge is a fleet payment solution for EV charging that accurately pays for drivers' business mileage directly to the drivers’ home energy supplier. Mina then consolidates all home and public charging costs into a single monthly business invoice for fleets.
“Drivers on the Mina platform won’t ever suffer from ‘bill shock’ and are never out of pocket while waiting to be reimbursed by their employer for their business mileage,” said Tate.