One of the best reasons for buying an electric vehicle is all those gallons of $3 or $4 gas you won’t be paying for. There is a certain sense of freedom that comes with knowing you won’t have to be tied to the gas pump. And think of all the money you’ll save!
Or maybe not…
Some people may save a lot of money by choosing an electric vehicle over a gas vehicle. Others may save little or none. The question of how much money you will save, if any at all, is actually pretty complicated. Here are the factors you’re going to need to consider.
A fair warning if you are going to try to answer this question; the math can get a little tricky. This online electric vehicle cost calculator will make the number crunching a little bit easier for you.
- What is the fuel efficiency of the vehicle you are giving up to buy your electric vehicle? Are you passing up a 14 MPG, gas guzzling, 2005 Chevrolet Tahoe or a 28 MPG 2008 Ford Focus that sips gas with its pinky extended?
- What is the price for gas in your area and what are your expectations for gas prices in the future? $4 a gallon? $5 a gallon? $3? At $3.50 per gallon your fuel cost for that Tahoe is $0.25 per mile. For the focus it’s more like $0.13 per mile.
- What is your electricity rate? Depending on where you live in the U.S. you may pay anywhere from 7 cents per kilowatt hour to 16 cents per kilowatt hour. The cheapest electricity in Texas is about 8 cents per kwh. Many areas are starting to implement pricing based on time of day. This is good news for EV owners since overnight rates are typically the lowest rates of the day because demand drops dramatically at night.
- What is the kilowatt hours per mile of your electric vehicle? This concept may be a bit foreign for most people at first. Rather than thinking about how many miles a car can drive on gallon of gas (MPG), EV drivers must be concerned with how many kWh of electricity are required to drive a mile.
If you assume a kWh per mile of .30 (a reasonable assumption for the Nissan Leaf) and a middle-of-the-road cost of $.10 per kWh for electricity you arrive at a cost per mile of $0.03 for electricity compared to a cost of $.13 per mile in gas to drive a 2008 Ford Focus. It seems like a no-brainer to go with the electric vehicle.
But, as is often the case in life, things aren’t that simple. There is a second component to the fuel cost of driving electric that you must include in the cost. The batteries that power electric vehicles are quite expensive and they don’t last forever. So if you want to be thorough in your cost analysis you will need to make room for two more variables in your equation.
- What’s the lifespan of your EV battery? There is not yet enough real world data to say anything definitive about the true lifespan of the current generation of lithium ion batteries. However, the Nissan leaf battery has a 100,000 mile warranty.
- What’s the replacement cost of your battery? When your EV battery does eventually succumb to old age it will no longer hold a sufficient charge to power your vehicle. Then you have to buy a new one. Like most technologies, the cost of these batteries is expected to go down with time. It’s hard to know exactly what it would cost to replace it in 5 or 10 years but a reasonable estimate may be $8,000.
Putting it all together
So what does the final math show us? Well, once again the answer will depend greatly on your assumptions. But middle-of-the-road assumptions give us this answer.
Electricity cost per mile: $.03
Battery cost per mile: $.08
Total electric vehicle cost per mile: $.11
Gas cost per mile: $.19