Electrification promises long-term savings and sustainability benefits for UK fleets, but the path is not without obstacles. Jonny Berry, Head of Decarbonisation, Innovation and Strategy at Novuna Vehicle Solutions, explores the unseen costs and how businesses can manage them to ensure their transition is both profitable and resilient.
The decarbonisation of transport is not just inevitable, it’s essential. For UK businesses, the electrification of fleets brings clear long-term rewards. It offers lower running costs, compliance with net zero targets, and the reputational benefits of being seen as a sustainable operator. Yet, behind the headlines that promise savings, there are costs that do not appear on a vehicle invoice that can erode both productivity and profitability. These hidden costs are the difference between a fleet strategy that struggles and one that thrives.
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Hidden costs beyond the vehicle
Stellantis data shows UK operators lose an average of 177.6 minutes per week, per vehicle, to charging – nearly three hours of operational time that could otherwise be spent on deliveries or customer visits. For a fleet of 50 vans, that adds up to more than six full working weeks each month.
Installing charge points at depots is rarely straightforward. It typically requires groundworks, switchgear and, most significantly, upgrades to the local electricity network, all of which can push costs far beyond the cost of the chargers themselves. Connection fees alone can reach hundreds of thousands of pounds. Once installed, fleets also face ongoing expenses from charge point management systems. These platforms are necessary for access, billing and reporting but they bring recurring subscriptions and transaction costs that ICE fleets never had to consider.
Unlike ICE vehicles, residual values for EVs remain volatile. Rapid technology changes and a young second-hand market mean businesses risk greater depreciation, complicating total cost of ownership calculations. For example, EVs aged up to 24 months old are trading at just 47% of their original cost, highlighting a sharp early drop of value. Fleets must also account for the cost of training and compliance, as drivers and technicians need new skills in high-voltage awareness, safe charging, and energy-efficient driving. Fleet Managers face adjustments too, from setting up internal systems to reimburse home charging to updating safety protocols.
Even once vehicles are on the road, the day-to-day realities of running an electric fleet comes with further cost implications. Operational downtime through charging during working hours is a hidden cost that directly impacts vehicle utilisation and profitability. Without careful planning and smart charging, fleets risk building in lost hours every week in addition to exposure to expensive peak tariffs.
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By GlobalDataAlthough servicing is often less expensive, repairs involving batteries or specialist components are often more time-consuming, which can not only increase insurance premiums but also add further vehicle downtime. Overheads related to driver support can also grow as fleets establish systems to reimburse home charging and manage subscriptions to public networks.
Policy: the good, the bad, the unclear
Government policy is already shaping the pace of adoption. The new Depot Charging Scheme, which funds up to 75% of infrastructure costs to a maximum of £1m per applicant, is a major step forward. Plug-in van grants continue to ease purchase costs, while exceptionally low Benefit-in-Kind rates compared to ICE vehicles make EVs attractive through company car and salary sacrifice schemes.
Yet gaps remain. Fleets struggle to access energy flexibility markets and are therefore unable to monetise smart charging or vehicle-to-grid services. Long-term taxation also remains unclear. And while grants are welcome, uncertainty looms around future taxation. Road pricing and the end of road-tax exemptions could add new cost lines just as fleets achieve scale. A lack of long-term clarity makes planning difficult, leaving businesses unable to model total cost of ownership with confidence at the very point when large scale investment is required.
Strategic investment in decarbonisation
As a leading advocate for zero-emission vehicles, offering end-to-end decarbonisation solutions which are helping small, large and complex fleets future proof their business operations, we understand these challenges are real, but we also see them as transitional. Many of the costs are one-off or short term and with the right planning they can be managed effectively.
Early engagement with distribution network operators, use of available grants and investment in smart charging technology all help to keep costs under control. That’s why we take a partnership-led approach supporting initial planning and site assessments to managing DNO applications, overseeing the installation of charging infrastructure, and negotiating energy tariffs directly with charge point operators. Our role is to remove complexity and risk for customers by delivering flexible finance, compliant and operationally suitable hardware, and reliable charger maintenance. Over the life of a vehicle, electric fleets can achieve parity with internal combustion, and in many cases outperform them.
What businesses need most now is certainty. Stable incentives, a clear taxation roadmap and regulatory frameworks that reward flexibility will provide the confidence operators require to invest at scale. The hidden costs of electrification must be acknowledged and addressed, but they are not insurmountable. With careful planning and the right support, electrification can deliver fleets that are cleaner, more resilient and financially sustainable for the future.
