Published on December 6th, 2012 | by Zachary Shahan


Is An Electric Car Worth The Money?

December 6th, 2012 by  

UPDATED COMPARISONS HERE — better assumptions (especially the price of a Ford Focus most comparable to the Ford Focus Electric) — but doesn’t include the intro sections below.

This article has been reposted from EV Obsession with permission.

Is an electric car worth it? Probably a common question these days. First of all, it’s worth noting that there are many, many factors to consider when determining whether or not an electric car is worth it to you. For example, some of the issues we won’t even address in the calculations below are: 1) the price of global warming and climate change, which is going to be exorbitant, and could even lead to the demise of the human species (I think that’s rather priceless); 2) the price of protecting foreign oil resources (which costs us human lives and trillions upon trillions of dollars in military expenses); 3) the price of air pollution from gasoline-powered cars (which, beyond making our lives worse by giving us everything from cancer to autism — hard to quantify — also costs the US trillions upon trillions of dollars).

Setting all of that aside, though, and looking at the matter purely from a short-sighted, narrow-minded perspective, let’s calculate the cost of driving a couple of comparable vehicles (one electric, one not).

Ford Focus Electric via Ford

Ford Focus Electric vs Ford Focus S

Due to their clear similarities, I thought I’d compare the Ford Focus Electric and the Ford Focus S. Now, there are three variables in the calculations below that can change considerably from person to person — 1) miles per year, 2) price of gasoline per gallon, and 3) price of electricity per kWh. Even looking at the price of electricity per kWh, that can change dramatically depending on the time of day in some regions, or depending on the total amount of electricity you use in a month.

With all this said, for you to actually calculate the difference in costs between these two cars (or any other two cars), you’d need to use your own numbers (at least the best that you can project them). For my baseline comparison here, I’m using the nationwide average for each of these. The average miles per year is currently 13,476 (though, it’s 15,098 for the average person 20–34 years of age, 15,291 for 35–54 year-olds, 11,972 for 55–64 year-olds, and 7,646 for 65 year-olds and up). The average price of electricity per kWh is 12¢ (though, the average ranges from 7.5¢ in Idaho to 36¢ in Hawaii). And for the ever fluctuating price of gas, I’ve started with $3.50, which seems to be about the average for 2012 so far (given that the price of gas is expected to go up considerably in the coming years, I’m going to show more reasonable projections following this first one).

Based on those first assumptions, here’s what we get (after a $7,500 federal tax rebate):

So, you’d get your money back and start saving money in year 13. (Again, notably, that’s aside from any time or health benefits you gain from not standing at gas stations pumping gas, and from not having your car put pollutants into your driveway, yard, and garage.)

Now, if we change some assumptions up, we get huge differences, of course. With a change to 20,000 miles per year, you see savings starting in year 9:

Keeping avg annual miles at 13,476, but changing the price of electricity to 6¢ per kWh (what one Volt driver who we know gets), savings start to accrue in year 10:

With the average price of gasoline changed to $4.50 for this period of time, the savings again start to kick in during year 9 (change to $5, it would be year 8):

With all three changes above, your savings start to kick in just after year 5 (or, with gas changed to $5, sometime after year 4), and you save about $15,000 by year 10 (or about $20,000 based on the $5/gallon projection):

Now, clearly, I don’t know what your own assumptions would be — even you don’t know what the price of gas and price of electricity will be, nor how many miles you’ll drive. I also don’t know how much importance you give to health, national security, clean air, and the current climate. So, to determine if an electric car is “worth it,” you have to go ahead figure all those things out, or give it your best bet. (If you want to shoot me some numbers, I’d be happy to put them into my spreadsheet for you and shoot back another table… or I could simply share my spreadsheet with you.)

Also worth emphasizing again this is just a comparison between two similar cars. There are many other electric vehicles (and gasoline-powered vehicles) on the market that you could look at more closely (I’m sure you weren’t aware of that). For example, the new Honda Accord Plug-In Hybrid could be compared with a standard Honda Accord. Or, if it fits your lifestyle, you could compare an electric scooter with a car!

One last thing to think about, also, is the value of a car after a number of years. Perhaps you only intend to keep the car for 3-5 years. In the scenarios above, you wouldn’t regain your personal financial investment in that time. However, you’d surely sell the car. Would it be worth more or less if it were an electric car? My bet is that it would be worth more.

Why? First of all, an electric motor is much simpler than a gasoline-powered car’s comparable parts. It’s likely to last much longer. On the other hand, the batteries will need replaced at some point, and they aren’t cheap. When they need to be replaced and how much that will cost really depends on the vehicle and the evolution of batteries in the coming years. With modern electric cars just hitting the roads in recent years, we don’t really know what the norm is yet. Another thing to consider is the price of gas — as the price of gas goes up, gasoline-powered cars are going to look less attractive, and their resale value will decrease. And, of course, you’ve got to consider the cost of a new vehicle of the same model and type vs your used vehicle — if the new electric car is much more expensive than the new gasoline-powered car, one would assume the used model would also sell for more.

All in all, I’m not sure which type of vehicle would have a higher resale value, but I’d lean towards it being the electric car. Perhaps some of our gearheads could chime in with their thoughts on this.

Check out our new 93-page EV report, based on over 2,000 surveys collected from EV drivers in 49 of 50 US states, 26 European countries, and 9 Canadian provinces.

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About the Author

is tryin' to help society help itself (and other species) with the power of the typed word. He spends most of his time here on CleanTechnica as its director and chief editor, but he's also the president of Important Media and the director/founder of EV Obsession, Solar Love, and Bikocity. Zach is recognized globally as a solar energy, electric car, and energy storage expert. Zach has long-term investments in TSLA, FSLR, SPWR, SEDG, & ABB — after years of covering solar and EVs, he simply has a lot of faith in these particular companies and feels like they are good cleantech companies to invest in.

  • Corey Robertson

    Now, this article is a year old and I don’t expect a true reply but your entire focus for this is…… slanted. The most I see in the EVs are middle aged men that work for the company or hipsters well, being hipsters. I am a young gun so forgive me if I seem wet behind the ears, but most people want something that looks good, is fairly priced, is very comfortable, and gets good MPG. I drive a simple honda civic with the 1.7 liter SOHC, it gets 40 mpg and takes about 25$ of premium to fill it up. The younger generation that are low to middle class workers are pushed more towards gasoline powered vehicles when it comes down to it. I myself almost purchased the Honda CRZ, but I couldn’t stand not having the power of a real motor or not having a 5-speed gear box. But that’s not the slant. personal opinion is not where the slanted facts you have stated come into play. It is what is left behind the curtain. The mining of the nickel in the batteries,the refining of the nickel, the shipping of the batteries to each country, the distribution trucks. All comes into effect on the global warming scale. The first vehicles that should be made electric are Semis, trains, and boats. Just my whole opinion.

    • Bob_Wallace

      Within a few years we should have 200 mile range EVs for less than $30k.
      If you’re a normal driver, driving about 13,000 miles per year, getting about 30 MPG and paying about $3.50/gallon you’re spending $1,500 per year on gas. In no more than 5 years fuel savings should pay for the price difference between a $20k gasmobile and a $27k EV.

      If you’re getting 40 MPG you’re doing some sort of unusual driving (or misreporting).

      If you’re worried about nickle in batteries, don’t. The nickle is not consumed. That, obviously, is not true for the hundreds of gallons of fuel you put in your Honda every year.

      As for the ‘not having the power of a real motor’, why don’t you go to a Chevy or Tesla dealer/showroom and give an EV a test drive? I suspect you will forevermore be disappointed in how wimpy your Honda is getting off the line.

      • Corey Robertson

        I’m not worried about the money i spend on gas. To people like me, 3.50 per gallon is well worth it to hear a motor’s rumble and roar. I also caught a bargain and paid $3k for my gasmobile. There is no unusual driving. The engine has been tuned and gets between 37-42 mpg depending on the way i drive. At the end of your entire argument though, the sheer value of loving the internal combustion engine can make the EVs not worth it. I think that until there are EVs that can do what the Tesla Roadster does for the price of a 350z, it is going to be popular with one or two crowds. I don’t mock them, fabulous idea, but they don’t have enough variety. The Isle of Mann TT now has the EV class. Once those bikes become cheaper they will fly off the production line because they are fast, have cornering, and are relatively cheap hopefully. It’s all about attracting everyone and that can and will be done one day, just not this soon after its intro.

        • Bob_Wallace

          The love of ” a motor’s rumble and roar” is an acquired taste. We learn to love the sound of a motor becaue it signals speed.

          A generation or so from now is going to equate ” a motor’s rumble and roar” with Grandpa’s quaint old gasmobile. The “$3k” EV they drive will do laps around the old gas clunkers.

  • Interesting article with some good points. We think you nailed it thought with "Is it right for you" There is a long way to go before a lot of people can consider electric cars otherwise they may end up stranded on a regular basis when they run out of juice.

    • Bob_Wallace

      I suppose that if you’re stupid enough to not pull over for a charge when your car tells you it’s time and gives you a map to a place to charge then an EV wouldn’t be right for you.

      Of course, if you’re that stupid you probably won’t figure out what that dial on your gasmobile dash means – the one that goes from ‘F to E’ and turns on a light when you’re pushing the limit….

    • let’s not make jokes that someone might read and non-fiction. the only way you’d get stranded on a regular basis is if you consistently decided not to plug your car in when you got home. most EV owners charge over night every other day. for those who drive more, every day should be adequate. for a select few, plugging in at work or other public charging stations may be needed.

  • Great insight guys!

  • Ronald Brak

    Looking at smaller cars, with regards to fuel and maintenance, very roughly an electric car will be about 14 cents a kilometre cheaper to run in Australia than a standard internal combustion engine car. The average distance a car is driven in Australia is about 15,000 kilometres so an electric car would save about $2,000 a year. If it has a battery like the leaf that apparently costs about $12,000 then the battery will pay for itself in six years. So provided they suit the owner’s driving habits, electric cars should be money savers in Australia.

    As an electric motor is much simpler and cheaper than an internal combustion engine, so once electric cars are mass produced they should be cheaper than the cost of a similar internal combution engined car plus batteries. Also, it is possible for an electric car to make money by providing vehicle to grid energy storage services. I also expect the price of battery packs to decline, further improving their economics.

  • sean

    In Australia, at current petrol prices, 50% free charging and a payback time of 8 years, we will need to have a reduction in leaf prices of 30%

    • Ronald Brak

      Considering that a leaf in Australia costs twice as much as a small car plus the $12,000 battery pack, a 30% reduction is easy. But currently the leaf isn’t seriously being marketed in Australia. It can’t directly take Australian/European current, which is a pity as a standard power point here is powerful enough to charge a leaf overnight without the need for any special charging station.

      • just_chris

        An electrician would probably put a 15 amp plug in your car port for not much money. if you currently have power I would expect all he would need to do is change the plug. also worth mentioning is that Australia has thousands of charge points. they are called caravan parks each pitch has a 15 amp plug. not so common in the city but worth remembering on a long drive

        • just_chris

          Ps a leaf draws exactly 13amps, UK standard. The big problem is the laws that make it almost impossible to import cars which means an ev costs insane amounts you can get a quote online for a miev… $55k the Aussie dollar is pretty much the same as the US.

        • Ronald Brak

          Good point about caravan parks. There are plenty of places to plug in. And I’ll give you some power if you need it. Might need to bring your own extension cord, however.

          • Bob_Wallace

            Recently a guy blogged about crossing the US in his Tesla S. He used RV (caravan) parks for part of his charging. They are already set up with metered outlets or charge a fixed use price.

        • hmm, great point on the caravan parks.

  • The Focus EV is one of the more expensive EV’s. The financial outlook improves with a less expensive EV such as the LEAF.

    It’s good you give several examples for your readers, but it is not a one size fits all equation. As you pint out there are many factors. I developed a spreadsheet to help people customize it the their personal situation.

    • Thanks. Planning an addendum, and will certainly use and link to this. 😀

  • jonesey jonesey

    Is this really the main way people compare cars, though?

    Let’s do the same thing now, except let’s compare two nearly-identical cars, one with a sunroof and one without. The one with the sunroof costs $300 more. Now, what’s the payback on that sunroof? Zero, you say? So by the logic of this article and many, many like it, nobody should buy a vehicle with a sunroof! And yet people do.

    Many people are willing to pay extra for a vehicle that contains new or fancier features (GPS, fancy stereo, leather power seats that remember each person’s settings and adjust with the push of a single button). One of these fancy new features is the ability to run on electricity at least part of the time.

    To calculate the true “payback”, you would need to figure out how to estimate how much more someone is willing to pay just to have this cool new feature in their life, then discount the price of the PHEV car by that much before comparing its fuel consumption and maintenance costs to a similarly-equipped traditional ICE vehicle.

    • Jim B

      I was willing to pay a significant premium…
      to power my commute with electricity.
      to not have to worry about oil changes, smog checks, timing belts etc.
      to enjoy the smooth, swift, silent power of electric propulsion.
      to be able to fuel at home in the comfort of my garage.
      to reduce my daily commute fuel cost by $5.

  • I think the batteries will last at least 8 years and probably 12 or longer with decent treatment. You should be able to replace individual cells if they go bad.

    You really do need to include regular maintenance – it adds about 25% more to the cost of driving an ICE car. EV’s have virtually *no* regular maintenance – just tires and wipers, which you obviously also have on an ICE. There may be transmission oil at ~100K miles? Oh, and an EV is much easier on it’s brakes since you can use regenerative braking for nearly all normal stops.

    The Focus Electric (which is a 5-door hatchback) is pretty well “loaded” – it has the navigation system, which is optional even on the Titanium 5-Door. So, I’d start with the SE 5-Door ($19,200) and add the navigation system.

    Lastly, if you live in a state where you can get a solar PV system installed for low up front cost, then you can cut your electric bill by 30-70% and drive your EV for “free”. My brother and his wife each drive an EV (an i MiEV and Leaf respectively) and they are getting a 6+kW solar installation (26 panels) for just ~$1,500 down and $58/month for 20 years. They currently pay ~$80-170/month, which includes their EV’s and A/C in the house in the summer.

    So, no money for gas, and a lot less for their electric bill.


    • Thanks. Do you happen to have any references on the avg regular maintenance costs?

      • I only know what it costs for my Scion – Ford might have different standard amounts. Maybe a call to a Ford dealer would be the way to get up to date info?

        Minor Service (oil change plus a few things) every 5K miles is about $80

        Intermediate Service every 15K miles is about $250

        Full Service every 45K miles is about $475

        So, at 90K miles you would have 12 Minor = $960
        4 Intermediate = $1,000
        2 Full = $950

        Total cost for Regular Service per 90K miles = $2,910

        Or, at 15K miles per year, you pay $635 in the 3rd and 6th years, and you pay $410 the 1st, 2nd, 4th and 5th years.

        Another point to make is the cost of gasoline will very likely get much more expensive, while electricity will probably not increase as much. And since the huge majority of the cost of driving an ICE car come in the future fuel costs, whereas the bulk of the cost for an EV come in the purchase price.


        • Thanks. Yeah, there are really a ton of assumptions that could be modified. I’ve made the spreadsheet available to everyone (in the new post) if anyone is interested in playing around with it. Fun stuff, imho. Of course, I think an EV is worth purchasing now. But I’m not in the market for a car at all, no need for one where I live…

  • Mika Elian

    Ford Focus S is the least equipped model. Would be more beneficial effort if you compared similarly equipped models. Also, did you consider oil change, tune up, and smog check costs? Also, CA has a $2500 gift for clean air vehicle owners.

    • I was under the impression that the Ford Focus Electric was most similar to the S — which version is it most similar to?

      Almost mentioned the oil change, tune up, etc, but also left out the cost of a battery change.

      Almost mentioned that there are some local & state incentives, but wanted to keep it general. And figure people know about such incentives in their areas, but maybe not. Do you happen to know of a source that shows all of those? Simple stating “there might be…” isn’t very useful.

      • Jim B

        The Focus Electric is fully loaded so should be compared to the $26,185 Titanium. It will be tough to gauge the average actual sales price for the two cars. Maybe checking Edmunds after the Electric has been on sale for a while can help.
        I love my Focus Electric. It a premium driving experience.

        • Out of curiosity, did you try out other EVs before buying it? If so, what’d you think of the diff ones you tried?

      • The battery should be factored in. Most notably the warranty and cost (~$12,000), and the fact that you can expect it to last at least as long as the warranty.

        If it doesn’t last as long as the warranty, it is to be replaced for free.

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