How to green your company with electric cars for your employees – for free

In this guest article, Thom Groot, the Co-founder of the Electric Car Scheme, explains how business leaders can make their companies greener with free electric cars for employees.

Offering a Government-subsidised lease on an electric car is a great perk for potential hires and an excellent way to make your business more sustainable, without spending a penny.

Electric cars are no longer a luxurious novelty. Legacy car-makers have put their manufacturing might behind a plethora of models. With these expanding options, it’s no surprise that 40% of drivers were willing to make the switch in a recent survey – but many were still worried about the immediate upfront cost and have range anxiety. The demand is there, but it is cautious demand – just 1.4% of the UK fleet is fully electric.

Leasing a car is far cheaper upfront, and lets drivers wary about battery range see just how far an electric car can drive. But leasing itself can still be pricy, which is where you as an employer can come in with a salary sacrifice scheme, which could save your employees between 30% and 60% on the cost of a lease.

How salary sacrifice works

Salary sacrifice programs have existed in various forms for decades. A recent one that is especially well-known is the Cycle to Work scheme.

Your employee agrees to sacrifice a certain portion of their salary for the cost of the lease – but unlike all the other things they might buy with their salary, they get to do this before the income is taxed, leading to large savings.

There is a small Benefit in Kind tax that usually applies to these kinds of schemes, but the Government has intentionally kept this exceptionally low for electric cars, to encourage uptake.

Saving on paperwork

Of course, any Government tax scheme comes with a degree of complexity. The salary sacrifice scheme for electric vehicles is no different and can be a real headache.

In fact, that’s why Tom Eilon and I first set up The Electric Car Scheme in 2020 – we were trying to access the Government subsidy ourselves and it was basically impossible.

However, compared to regular leases, salary sacrifice schemes will save your employees between 30% and 60%.

More importantly, changing your workforce’s commute can be a serious boon for the planet. Getting around is the most emissions-intensive thing a lot of folks do. Transport emits more than any other industry group in the UK, accounting for about 24% of 2020 emissions – despite the lockdowns cutting down travel.

The exact amount of emissions your business knocks off from having employees commute in a clear car will depend on how far they are driving, and how clean the car they were driving before was. But it’s likely to be a big chunk. For example, driving a standard petrol car for 10,000 miles would be about 2.7 tonnes of CO2 – well over a fifth of the average annual emissions of a UK resident, and equivalent to about 102 trees.

And yes, these transport emissions are part of your company’s overall emissions profile. The Greenhouse Gas Protocol, the most widely used greenhouse gas accounting standard, includes commuting as part of a company’s footprint for its “Scope 3” standard, which also covers emissions from your wider supply chain.

Taking these holistic emissions into account will show your company is serious about sustainability – to customers, investors, and employees.