Fuel costs of EVs vs. gas powered cars

by Ernie Hernandez on April 23, 2016

Moneybags

EVs still cost less to drive

About three years ago we wrote an article about the comparative operating costs of electric cars vs. gas powered cars (found here). Three things have happened since then – the cost of gasoline has gone down, the cost of electricity has gone up, and the average new car goes farther on a gallon of gas. So if you’re wondering how much it costs to drive an electric car vs. a gas powered car with current fuel prices, read on because now seems like a good time to review whether it still makes sense to drive electric.

All new vehicles under 8,500 pounds Gross Vehicle Weight Rating (how much the vehicle can weigh fully loaded) have a federally mandated portion of the window sticker that is apportioned to the Environmental Protection Agency (EPA) to provide fuel economy information. This is what it looks like for a gasoline powered vehicle:

EPA Fuel Economy Label - Gasoline

A significant amount of useful information can be found at the fueleconomy.gov website. In this sample label the assumptions used are provided at the bottom of the label. In this instance gasoline prices were higher ($3.70 per gallon) and the average new vehicle’s fuel economy was lower (22 miles per gallon) than is currently the case. EPA assumes 15,000 miles per year. In our calculations below we will use the current figures.

Because electric vehicles do not use gasoline a different version of the Fuel Economy and Environment label was developed. Here is a sample of the EPA label for an electric vehicle:

EPA Fuel Economy Label - Electric

The formats are similar, but the electric vehicle label includes the price of electricity in cents per kilowatt-hour rather than the price of gasoline.

Here are the values currently used by the EPA to determine current Fuel Economy and Environment labels:

2016 EPA Fuel Cost Chart

Given these assumptions, we will use the 2016 LEAF to represent the EV and see how the fuel costs compare to the average new gasoline powered car.

According to the EPA the 2016 LEAF uses 30 kilowatt-hours per 100 miles. The LEAF would use 4,500 kilowatt-hours to travel 15,000 miles per year. At $0.13 per kilowatt-hour the cost per year for the LEAF would be $585 which the EPA rounds up to $600. Over five years the LEAF would consume $3,000 in electricity, netting it a $6,000 savings over the average new car 0ver a five year time time frame.

The website gasbuddy.com has historical pricing for gasoline across the United States, and according to their surveys the national average price of regular gasoline has been below $3.00 since late 2014. So let’s use their latest national average regular gasoline price of $2.14 per gallon to see how this comparison looks.

Gas Price Chart 160423

When we input the GasBuddy current national average for regular gas the situation is a lot more favorable to gas powered vehicles:

Gas Buddy Cost Chart

Still, at $3,000 in electricity cost over five years the LEAF still comes out $3,420 ahead. Certainly there are states or locales where gas prices are lower and electricity prices are higher. In those situations, armed with these calculations it can be determined if fuel operating costs favor an electric car or not.

In this analysis we are looking only at the cost of the fuel. There are obviously many other considerations – cost of the vehicle, maintenance costs, repair costs, etc. EVs generally have lower maintenance costs. One major budgetary consideration might be the stability of the cost of your fuel source. Since 2002, the national average price of a gallon of regular gasoline has ranged between $1.00 per gallon and $4.00 per gallon. During that same time the national average price of electricity has ranged between $0.09 per kilowatt-hour and $0.14 per kilowatt-hour. In other words, gasoline has seen a 400 percent swing in its price, while electricity has seen a 56 percent swing in price. While predicting the future is never a safe bet, the odds favor gasoline prices being more volatile than electricity prices in the future, similar to what we’ve seen in the past.

So while the gap between gasoline fueled cars and electricity fueled cars has narrowed over the past three years, purely on a cost of fuel basis, it is still cheaper to drive electric.

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Can Nissan stay relevant in the EV space?

by Ernie Hernandez on March 20, 2016

LEAF Charge Port Lid

Will others take the lead?

When Nissan introduced the LEAF to the US market in December of 2010 I don’t know that anyone saw what this vehicle would do to the future of transportation. Certainly there were lofty goals and aspirations, but much of that was dreams and wishes with no real understanding of how this vehicle would impact the market simply because a change like this in the automotive world had never been seen before on this scale. True, GM came to market with the EV1 in 1996 – and produced a whopping 1,100 units over three years. Also, GM did not sell a single vehicle. They leased every one. The LEAF sold roughly 90,000 in its first five years in the US. Nissan came to market with a plan for a mass market EV, a plan which they have followed through on with the ripples being felt around the globe. When the LEAF came out, the only other battery electric car on the market in the US at the time was the low volume Tesla Roadster which became available in 2008. Chevrolet also launched the Volt with its onboard 4-cylinder range extending gasoline engine in December 2010. Since that time manufacturers from Asia, Europe, and the US have all jumped aboard the EV train offering pure battery electric vehicles, range-extended battery electric vehicles, and plug-in hybrid electric vehicles with some having already gone by the wayside. This time the EV movement is carrying much greater momentum than its mid-90’s attempt. But with modern second generation vehicles with greater range right around the corner is Nissan positioned to hold the market share that they established with the first generation LEAF?

General Motors has already announced the launch of the 2017 Chevrolet Bolt with production beginning the end of this year. That could mean deliveries either late this year or early next year. Chevrolet’s first true EV (if you don’t count the Spark EV, which many don’t), the Bolt carries a 60 kilowatt hour battery pack which should provide an EPA range of over 200 miles. When introduced at the Consumer Electronics Show in Las Vegas earlier this year, GM CEO Mary Barra placed the cost at “around $30,000 after government incentives”, which would put the price around $37,500. Both 60 kWh and $37,500 are important to keep in mind if your name is Nissan because currently their least expensive 30 kWh SV trim level starts at $34,200. But the Chevy Bolt is only one point of concern for Nissan. The Tesla Model 3 also lurks behind the curtain.

The Tesla Model 3, which Elon Musk said would be unveiled this month, is expected to have a starting price of $35,000, also according to Musk. But Tesla’s online marketing for its Model S bizarrely prices the 70D at $58,200 after government incentives and gas savings, with the actual price of $75,000 listed further down the web page. So my guess would be a starting price of at least $42,500 before federal EV incentives kick in [Update: Tesla’s announced starting price is $35,000 before incentives]. I also expect that, just as with the launch of the Model S and then the Model X, every early Model 3 buyer will pay significantly more than that for the Performance or Signature trim level, as that will likely be the only trim level produced initially. For example, the Model X theoretically starts at $80,000 with a 70 kWh battery, but the early deliveries were the Signature 90 kWh battery vehicles at upwards of $132,000 with no 70 kWh vehicles produced yet. All that to say that it is unlikely to see any Tesla Model 3s anywhere close to $35,000 for quite some time after initial deliveries begin. Musk has said production should start in late 2017, though Tesla also has a history of delaying initial deliveries beyond the promised launch date. With $100,000 plus vehicles (and the customers that buy them), this may not be a concern. But if Tesla wishes to play in the mainstream auto market in a big way, this behavior could prove troubling. The Tesla Model 3 would like to be an affordable, everyman EV, but we don’t really see that happening anytime soon.

What do these two vehicles in particular mean for Nissan? Precisely what they mean is that Nissan’s second generation 2018 model year LEAF must come out early in 2017, with a real world price closer to the Bolt than the Tesla, and offer a 60 kilowatt hour battery as standard equipment at that price. This would mean that to remain competitive Nissan would need to double the size of their current battery pack, and do it without raising the price by more than about $3,300 from their current SV trim level. Every month that the Chevy Bolt is on the market against Nissan’s aging first generation LEAF will cost Nissan market share. In the five years plus since Nissan launched their EV, many studies have been done that show that both range and price must come together to meet at the not yet clearly defined sweet spot for broader mass market appeal. For many, that sweet spot will be called the Chevy Bolt and it may just be the answer to their needs – 200 mile range for around $30,000 after incentives. That Nissan laid the groundwork will be immaterial to most of them. The next year or so will be very interesting in the EV marketplace.

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LEAF owners buy more LEAFs

February 8, 2016
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Volkswagen – It’s Simple

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Turn the emissions control systems on Much has been reported in recent days about the Volkswagen emissions control scandal. Little has been said about what to do about it. It’s simple – turn the emissions control systems on. Having read many reports about the situation, it is clear now that Volkswagen has emissions control systems […]

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2016 LEAF gets 107 mile EPA range, new battery warranty

September 10, 2015
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New larger battery increases range, price Nissan has announced the release of the 2016 LEAF with a 30 kilowatt hour battery as standard equipment in the SV and SL models, providing an EPA rated mileage of 107. The S model continues with the 24 kilowatt hour, 84 mile EPA range battery. “The new battery offers […]

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Free Advance Reader Copy of The Electric Car

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Innovative use of used EV batteries

August 1, 2015
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FreeWire Technologies develops mobile EV charging One concern of the relatively new EV industry is what is going to be done with used EV batteries. California based FreeWire Technologies, one of hopefully many more to come, has a creative solution. When an electric vehicle (EV) battery produces only 70 percent of its original capability due […]

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Stopgap larger battery 2016 LEAF due this fall

May 31, 2015
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2016 LEAF to bridge gap to LEAF 2.0 [UPDATE 6/13/2015] I have confirmation that Nissan’s upper two trim levels will use the new technology battery cells in the current battery modules. Nissan will not confirm the range, but it’s a safe bet that range will improve to at least 105 epa-rated miles. *** It seems […]

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