New car road tax guideCut car tax by switching fuels

Whether or not you believe that the car is the root of all environmental evil, what’s undeniable is that choosing a greener car can actually benefit you financially.

Just choosing a car with better fuel economy, for example, will not only reduce your carbon emissions, it will also cut your fuel bills and could also cost less in car tax.

You could save by going for the diesel 207

Cut car tax and fuel bills

The easiest way to go green and cut down on your bills is to switch fuels.

Over 10,000 miles at current prices, the driver of a Peugeot 207 1.4 petrol will spend £1211 on fuel, whereas fuelling the HDi diesel alternative will cost £964, as it averages 62.7mpg rather than 44.8mpg. This means the diesel driver will save £247, despite the higher cost of diesel fuel.

However, this does not take into account the additional £900 it costs to buy the diesel-engined car.

Despite owners recouping some of this extra cost when they sell the car – thanks to the stronger retained values on the diesel car – the real financial benefits of choosing a diesel model only come if you cover higher mileages.

Someone averaging 20,000 miles annually, for example, would recoup the 207 diesel’s extra cost within two years.

Small differences ‘significant’

Remember, too, that apparently small differences in economy can be significant, particularly when the overall fuel economy isn’t that great.

For example, a 2.7 TDV6 Range Rover Sport averages 28.2mpg, with the TDV8 model averaging not much less, at 25.4mpg. Nevertheless, choosing the TDV6 over the TDV8 equates to a £236 annual saving over 10,000 miles. However, choosing a 64.2mpg 1.5 dCi 86 Renault Clio instead of a 61.4mpg 1.5 dCi 106 will save just £43 a year.

Here, it is important to understand that the difference in fuel costs between 10- and 15mpg is, proportionally, well over six times higher than that between 40- and 50mpg. Savings in CO2 and expenditure will therefore be greater on less fuel-efficient cars.

This has led some to call for fuel consumption to be displayed in litres per 100 miles, rather than miles per gallon. This would follow the example of the rest of Europe, where official figures already quote consumption in the number of litres of fuel needed to cover 100km.

In that case, a lower number is better, and it is a much more linear, representative system. To calculate your car’s economy in litres per 100 miles, divide 100 by the mpg figure and then multiply the answer by 4.546.

This 2004 Volvo V70 2.4 is cheaper to run on LPG

Petrol vs LPG

It is harder to work out the differences between petrol and LPG cars. Because LPG-powered models are no longer sold as ‘new’ cars, there is no obligation to run official fuel tests.

However, a 2004 Volvo V70 2.4 serves as an example. Volvo tests revealed the model would average 29.7mpg on petrol, and emit 227g/km of CO2. However, while economy dropped to 23.2mpg on LPG, CO2 emissions also fell – to 197g/km – making it greener.

And, 10,000 miles’ motoring on LPG (which is much cheaper than petrol, at £2.66 a gallon) costs £1146, compared to £1824 on petrol. That’s a yearly saving of £678, or over a third.

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However, when you start on your own calculations, remember that official figures are often not what drivers actually achieve; even the car makers admit official figures are best used as a comparative tool, rather than a guarantee of what customers can achieve.

The driving style alone can result in a 30% difference in fuel consumption between drivers of identical cars. And, there are infinite variations in driving styles and in road, car and weather conditions, all of which can have a bearing on the results achieved.

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