By Louis Tate-Harris, EV Fleet Analytics Team Lead | 5-minute read
Because energy is a significant component of EV fleet TCO
When electrifying your fleet, your business’ cost makeup will change significantly. Whilst the savings from eliminating diesel costs are a major factor in making an EV fleet cheaper (typically), energy costs still account for a significant portion of the fleet’s total cost of ownership (TCO).
In fact, energy costs typically amount to 11% of the total cost of ownership (TCO) for an EV fleet1.
For any business, success means delivering a service or product that meets end-user needs while remaining commercially viable. For EV fleet operators, managing energy is key to achieving the balance of service-levels and commercial viability, with energy cost savings being a major lever in improving the latter.
Commodity charges and levies are increasing, alongside the impact of global events.
Whilst wholesale energy prices – the cost of the energy itself – get much of the media coverage, they are long-term stable with the caveat of spikes due to globally significant events such as COVID and the gas crisis of course.
The more significant components driving energy price increase year on year are the non-commodity charges and levies – the costs that aren’t for the energy itself. These take various forms but are typically used to fund network investment and energy security. In the UK, significant investment in new generation, transmission, distribution and energy resilience is driving these to become a more significant cost than the energy itself.
Forecasting provided by our Power Procurement team demonstrates this growth in charges and levies with a rise from around £114/MWh in 2026/27 to around £132/MWh in 2029/30 – an increase of just under 17% in three years5.
Over the same period the wholesale forward curve – the forecast of expected energy costs – falls from about £129/MWh to about £72/MWh as the market recovers from recent geopolitical events4.
Based on these forecasts, non-commodity charges will overtake the wholesale price during 2027, and by 2030 they will account for around 65% of the delivered cost of electricity – close to two-thirds of the bill before VAT and the Climate Change Levy. The spread between sites is wide: at the most exposed depots in our portfolio, the figure is nearly three-quarters of the bill.
65%
By 2030, non-commodity charges are forecast to make up around two-thirds of the delivered cost of electricity. The energy itself becomes the smaller part of the bill.
Zenobē power procurement forecast, Sept 2026 · ten GB depot sites · excludes VAT and CCL
Significant components are peak power or time-of-use dependent (not only volume)
With time-of-use (e.g. dual) tariffs and emerging flexible market-exposed tariffs gaining popularity, the commodity part of the bill becomes sensitive to when you use the energy versus a traditional fixed tariff.
The non-commodity charges are also split into time-of-use components (such as DUoS RAG bands) aimed at incentivising energy use in the quieter periods when the grid is less heavily constrained, or peak/ capacity components which incentivise the reduction in peak power or flattening of your energy usage profile.
60%
As the non-commodity charges are increasing fastest and a decent proportion of these are capacity-dependent (i.e. based on your peak power consumption), the UK is slowly shifting from a time-of-use dominated market to one where both this and capacity matter equally. This is a trend we are seeing in many other global markets including Europe and USA, also driven by grid investment in the face of increasing electrification, renewables and data centres.
Unlike conventional industrial, commercial or residential energy consumption, fleet EV charging is typically flexible in terms of when charging can take place. As long as the fleet receives the required energy prior to the next departure, the delivery of this energy can follow many different profiles between arrival back at the depot to the eventual departure.
Given that we’ve highlighted that most of an energy bill is sensitive to the time of use and peak power, there exists significant opportunity to reduce energy bills through smart charging. There are two primary strategies to do this, facilitated by software:
Load shifting
Moves energy consumption into cheaper time of use periods. For EV fleets this typically means delaying the start of charging until later in the evening to exploit cheaper overnight prices.
Peak shaving
Uses load balancing – a software algorithm allocating power between chargers up to the configured limits – to flatten the power profile, delivering a lower and more stable power for longer.
It is worth noting that these two strategies are often at odds and tailoring the best combination to a particular fleet’s operating patterns and power flexibility is the scope of smart charging optimisation.
These strategies are embedded into Zenobē’s EV Fleet Analytics team’s optimisation models – to deliver the lowest energy bill for your fleet. This is the smart charging component of our software offering – regularly revised at the change of seasons, tariff or fleet schedule to fit our customer’s needs.
Stay tuned for the next in our series of smart charging technical articles, where we will delve further into these smart charging strategies and dig into the impact on some real EV fleet sites.
Our analytics team works with fleet operators to break down exactly what’s driving their energy costs, before building a charging strategy around it – tailored to the tariff and the operation, not a generic template.
Thanks for getting in touch – we’ll respond as soon as possible. You can also reach us on contact@zenobe.com
Pete leads Zenobē’s growing team of Product specialists across all areas of the business. His team oversee our R&D as well as product development in both hardware and software.
He has been working in the European E-Mobility sector from over ten years, specialising in the design, build and delivery of software systems for EV Charging.
