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Save Money on Tax, Insurance and Petrol with Green Cars

Driving a car doesn’t have to cost the earth. If you choose to drive an eco-friendly vehicle then not only will you be doing your bit to save the planet, but you’ll also find yourself making drastic financial savings by not having to pay road tax.

Find out all about this and other savings you can make by driving an eco-friendly vehicle with this guide.

Vehicle Excise Duty Tax and Savings

The Vehicle Excise Duty (VED) road tax rates payable are worked out in various bands according to C02 emissions of the vehicle in question.

Vehicles emitting fewer than 100g/km are in band A and pay nothing whatsoever. Vehicles in in bands B and C pay £20 and £30 a year respectively for emissions up to 120g/km (band B tops at 110g/km). This goes right the way up to band M, with cars emitting over 255g/km paying £505. These rates are further reduced if you’re driving an ‘alternative fuel’ car, rather than one that runs on petrol or diesel only.

Bear in mind that the above rates are only payable on cars from the second licensing onwards. As of April 2010, anyone buying a brand new car will face different rates, with reductions for those with low emissions and an increase for those with high emissions. The road tax exemption on new cars bought after April 2010 now goes up to cars in Band D, with emissions up to 130g/km. Those buying a new car that falls in band M however, will now pay more than double at £1100 a year. These rates fall back to the standard rates from the second licensing of the vehicle.

Congestion Charge Savings for Green Cars

As well as the savings made on VED road tax, drivers of eco-friendly vehicles in London will find themselves exempt from the congestion charge that is the bane of so many drivers in the capital.

Cars that would be in VED band A, and that meet Euro Five Standard for air quality will pay nothing whatsoever. The Euro Five Standard is reserved for cars with the following maximum emissions:

CO - 1.0 g/km

HC - 0.10 g/km

NOx - 0.06 g/km

PM (Particulate matter) - 0.005 g/km (Direct Injection only)

The above applies to petrol cars only, below are the figures for cars with diesel engines:

CO - 0.50 g/km

HC+ NOx - 0.23 g/km

NOx - 0.18 g/km

PM (Particulate matter) - 0.005 g/km

Insurance Savings for Eco-Friendly Cars

If you’re not already pleased at the vast array of savings you’ll make by driving an eco-friendly car, you will be when you find out that many insurance providers will also offer you discounts on cover.

Several insurers will offer a 5% ‘green discount’ in an attempt to promote the use of low to zero emission vehicles on the road.

So you’re saving money on petrol, road tax and congestion charges; you’ve found a selection of insurance providers offering a discount on your premiums; now all that’s left to do is to work out which is the best deal overall.

Head over to our car insurance comparison page and we’ll help you find the perfect deal for you, at no extra cost.

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