The real cost of owning electric cars

This story is part of Included, a CNET center for all things electric cars and the future of electrified mobility. From vehicle reviews to helpful tips and the latest industry news, we’ve covered you.

At a time when refueling a gas tank costs up to $ 100, but only $ 10 to charge an electric car, buying an EV may seem like an obvious choice. But EV’s economy is complex, and you need to be aware of many unfamiliar factors before you can stick it with oil companies.

Buying a new car

To drive an EV, you have to Buys EV, often an expensive proposition. Even after selling or exchanging your current, conventional car, you can easily end up in the $ 10,000 or more hole. It will take you several years to catch up, as my CNET Cars colleague did Craig Cole calculates here, even if we accept a scenario in which you buy a very cheap electric car, live in a place with cheap electricity and always charge at home. These are many “ifs” to turn the purchase of a new electric car into an economical crash.

This is not a new concern: I cannot count the number of people I know who have bought a hybrid or other economical car at a net price much higher than they could save fuel with it. A friend insisted on replacing their Porsche Cayenne with a Cayenne Hybrid, even after I drew that it would take them 111 years to catch up.

Of course, a purely electric car will save you much more energy than this example Cayenne Hybrid, but the initial purchase price of EV and potentially higher insurance and increased repair costs could dull its economy. On the other hand, conventional cars have many maintenance costs that electric vehicles do not bear, such as changing fluids and more frequent brake services.

Many people buy EVs to save the environment, as well as money, a noble motivation that pays back their investment through fuel savings and environmental dividends. This is beyond the scope of this article, but consider the overall return on investment in the environment and ask yourself if there is a more efficient way to allocate the net funds you would spend on an electric car: Installing a solar installation on the roof or building a first class Zoom room to exclude most of your air travel business, here are a few examples that can be considered using a good carbon footprint calculator.

Steep depreciation

Depreciation is the “other price” of every car you buy, and it’s even more important to consider when that car is electric. The value of each new or later car model falls like a stone when you own it, creating a significant cost per mile, which is often worse for EVs due to their typically higher cost and often higher depreciation.

For example, Subaru, which is not known for electrified cars, has an average resale value of 66% of its new price after five years, according to Car Edge. With a new Subaru for $ 35,000, this depreciation will cost about $ 11,500 for the first five years, or $ 6.30 a day. To use an overworked metaphor, this is a latte for you and a friend, seven days a week.

Compare that to Tesla, which Car Edge projects to hold 58% of its value after five years (which puts it number 3 among luxury brands, according to Car Edge) and does so at a higher average price. If you buy a Tesla Model 3 for $ 60,000, you’ll get $ 25,000 in depreciation for the first five years, or $ 13.80 a day – like buying you and three latte friends every day. Part of the pain is due to the fact that Tesla has been so successful in selling EVs that its cars have long since ceased to qualify for a $ 7,500 federal tax credit.

Battery replacement

An important form of depreciation, which is unique to electric vehicles, is the possible replacement of the battery. Unlike a modern conventional car, where changing the engine is unlikely, replacing the EV battery is unlikely because the car is aging and provides unsatisfactory mileage. The cost of replacing the battery is highly variable, however $ 10,000 is a fair average estimate.

However, this price remains hazy, as few electric vehicles have been on the road long enough to severely degrade their batteries, nor has there been enough time to develop a dynamic, competitive market for battery replacement. It is also difficult to predict which owner of an electric car will bear the cost of replacing the battery, and although this price must already be taken into account in depreciation, I’m not sure the market is still mature enough to rely on it. If you buy a late model used car, know that you may be the one holding the bag when its range drops to a level that you or the next buyer may consider insufficient, causing cost or loss of value that undermines the overall saving electric driving.

However, there is a good solution to this problem with battery replacement: the reality. See my opinion why you may not need it somewhere close to the range you think you have.

Buying electricity is not easy

The price of electricity varies much more than the price of petrol, depending on where you live, the tariff plan you use, when you charge and whether you do it at home or on a commercial public charger.

In California, we pay an average of 18 cents per kilowatt-hour for electricity for housing, but in Idaho it’s 8 cents and in Hawaii it’s 28 cents, according to US Energy Information Administration. That deviation would be like paying $ 5 a gallon for gasoline in California, $ 2.50 a gallon in Idaho and $ 8 a gallon in Hawaii, a much bigger deviation than we see at the pump. And the price of electricity is not clearly indicated where you distribute it, instead buried in the swamp of tariffs and hours of the day.

You can contact the Environmental Protection Agency Fueleconomy.gov to compare costs between cars, gas or electricity. He is meeting comparison between BMW 330i xDrive and Tesla Model 3 Long Range exposes a significant difference in energy costs, which makes Tesla look like an absolute cost-saving machine.

But a A 2021 study by the Anderson Economic Group (PDF) concludes that driving an EV can cost significantly more than driving a conventional vehicle. This is a contradictory conclusion, but not entirely unfounded, although his assumptions involve a lot of refueling at retail outlets, not at home, and that you receive a healthy salary that should be counted as wasted while waiting for your car to refuel. For those who charge at home, the story is much rosier, but Anderson wisely amortizes the price of about $ 2,000 on a Level 2 charger, which most EV owners will want.

To answer the question we started with, whether it costs less, the same or more to drive an electric car compared to a car with a gas engine. Although this is not a very satisfactory answer, EV will probably reduce your real travel costs, although perhaps not overnight. I think the transition to electric cars is inevitable for a variety of technological, political and financial reasons, but you need to worry about how electric cars will be for you, not us.