Are EVs or Gas Cars the Cheaper Choice?

Is Driving an Electric Vehicle Cheaper?

Are you paying too much at the pump? Switching to an EV might save you thousands each year.

However, the exact savings depend on factors like location, driving habits, and charging options.

In this article, we’ll break down the cost comparison between EVs and gas-powered vehicles, covering fuel costs, maintenance, and long-term savings.

Key Takeaways

1. EV drivers save about $1,500 per year on fuel, especially if charging mostly at home.
2. Fewer moving parts mean less upkeep—about $300 saved yearly.
3. Despite higher upfront costs, EVs often become cheaper than gas cars in five years.

EV vs. Gas Car Cost Comparison

1. Fuel Costs

EVs generally have much lower fuel costs than gas vehicles. Charging an EV at home is often more economical, especially if you can charge during off-peak hours. Here’s how it breaks down:

• Home Charging: On average, charging an EV at home costs about $6-$18 for a full charge, providing a range of 200+ miles. This is roughly 1/3 to 1/2 the cost of fueling a gas car.
• Gas Costs: For a comparable 200-mile range, a gas car costs about $30.16 at the average rate of $3.77 per gallon.
• Public Charging: While home charging is cheaper, public fast chargers can cost more, from $20-$40 per full charge. For drivers relying on public chargers, this may reduce potential savings but still generally remains cheaper than gas.

In summary, EV drivers save an estimated 8.1 cents per mile on fuel costs compared to gas vehicles, which translates to around $1,500 annually for the average driver.

2. Maintenance Savings

Electric vehicles typically have lower maintenance costs than gas-powered cars due to simpler engineering and fewer moving parts. Here’s how they compare:

• Routine Maintenance: EVs don’t require oil changes, fuel filters, or spark plugs. Their regenerative braking system also reduces brake wear, extending the life of brake components.
• Cost Comparison: According to industry data, EVs cost around $949 per year in maintenance, while gas cars average $1,279. This translates to an annual savings of about $300 for EV owners.
• Long-Term Maintenance: The need for battery replacement after 8-10 years may impact costs, but many EVs come with battery warranties that last up to 10 years or 100,000 miles.

3. Initial Purchase Price

EVs often come with a higher upfront cost compared to gas-powered vehicles, though this gap is narrowing. The average EV price is around $53,048, while gas vehicles average $35,722. Factors impacting the initial cost include:

• Federal and State Incentives: Many buyers qualify for federal tax credits, which can provide up to $7,500 in savings. State and local incentives can further reduce the upfront cost.
• Price Trends: With advancements in EV technology and increased production, EV prices are steadily decreasing, bringing the cost closer to gas vehicles.

4. Long-Term Savings

Despite a higher initial cost, EVs can be cheaper to own in the long run due to lower fuel and maintenance expenses. Here’s what long-term ownership looks like:

• Average Driver Savings: For an average driver (around 11,011 miles per year), the combined savings in fuel and maintenance exceed $1,200 annually.
• High-Mileage Drivers: “Gasoline Superusers,” or the top 10% of gasoline consumers, could save nearly $5,000 annually on fuel and maintenance by switching to an EV.
• Cumulative Savings Over Time: Studies show that, in most states, EVs become cheaper than gas cars over a five-year period, when considering all costs associated with ownership.

5. Regional Variations and Location-Based Savings

Location significantly impacts cost savings when comparing EVs and gas cars. Here’s why:

• Electricity Rates and Gas Prices: In regions where gas prices are high, like California, and electricity rates are relatively low, the savings can be even greater. For example, Washington state drivers save up to 13.1 cents per mile on fuel, translating to about $120 a month.
• Insurance Costs: Insurance rates can vary, with EV premiums sometimes higher in cities like New York City and Detroit. However, the gap in premiums is narrowing as EVs become more mainstream.
• Local Incentives: Some states offer additional tax credits or rebates, which can enhance the cost-effectiveness of EVs.

6. Other Considerations

There are a few additional factors to keep in mind when considering the switch to an EV:

• Home Charging Installation: Installing a home charging station typically costs between $300 to $20,000, depending on the type of charger. For drivers who primarily charge at home, this one-time investment can maximize fuel savings.
• Additional EV Registration Fees: Some states have extra registration fees for EVs to offset lost fuel tax revenue.
• Insurance Premiums: While EV insurance may be slightly higher, the difference is shrinking as EV adoption grows.

The Bottom Line: Is It Cheaper to Drive an EV?

While the initial purchase price of an EV is typically higher, the savings on fuel and maintenance often make EVs cheaper over time.

For an average driver, the annual savings can range from about $1,000 to $2,200, depending on factors like location, annual mileage, and charging habits.

High-mileage drivers stand to benefit the most, with potential savings nearing $5,000 per year.

Ready to Maximize Your EV Savings?

If you’re considering an EV, finding the right electricity plan is key to maximizing your savings.

Find the best EV electricity plans to make the most of your new vehicle’s efficiency and take control of your energy costs.

Sources

1. Quarterly EV Cost Savings Report – Coltura
2. Calculate Your Fuel Cost Savings from Switching to an Electric Vehicle – Better Energy
3. Save Up to $2200 a Year Driving an Electric Vehicle – Energy.gov
4. EVs cost more, but studies show they’re typically cheaper – Axios
5. EVs Are Cheaper to Own Than Gas Cars in All But 2 States – Road & Track

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