The price comparison site found that an electric car typically costs £1,091 a year to run while keeping a petrol car on the road costs £2,062, a difference of £971.

The research analysed the cost of insurance, fuel, and vehicle emissions duty (VED). For drivers of electric vehicles, car insurance amounts to more than half (53%) of the annual running costs at £583 for a typical premium. These motorists also pay an average of £454 per year to charge their car.

The running costs for petrol cars are substantially higher as drivers of these vehicles pay an average of £640 for car insurance and £1,212 for the fuel each year. Owners of petrol cars also typically need to spend at least £155 per year on VED, while electric vehicles are exempt.

According to Compare the Market, the annual cost of driving an electric car has fallen by £77 in the past six months (December 2020 to May 2021), compared with the previous six months (June 2020 to November 2020).

This decline is due to a £54 drop in the cost of insurance for electric vehicles and a £23 dip in energy costs. Electric car drivers can further reduce their running costs if they switch to the cheapest premium available. This typically costs £489, which means motorists could save £93 by shopping around for a better deal.

However, despite the substantially cheaper running costs, the upfront price of electric vehicles is likely to be a significant speed bump for many drivers considering making the switch from petrol.

A second-hand electric car is typically worth £22,813, based on the average value of electric vehicles from insurance renewal data. This suggests it would take more than 20 years for the lower running costs to cover the purchase of an electric vehicle. However, motorists may be able to cover some of the purchase price by trading in their existing vehicle.

Dan Hutson, head of motor insurance at Compare the Market, said: “The popularity of electric cars continues to accelerate as these vehicles now make up around one in ten new car sales. Motorists who’ve made the switch will be glad to see our figures show electric vehicles cost roughly half as much to run as their petrol alternatives.

“These drivers benefit from substantial savings in fuel bills, insurance and tax – as well as doing their part for the environment. Electric car owners could save even more on running costs if they shop around for the cheapest deal when their insurance premium comes up for renewal. These drivers may also want to think about switching to a new electric vehicle tariff for their home energy. EV tariffs are designed to help motorists cut their energy bills by making it cheaper to charge electric cars overnight.”