Save Thousands of Dollars a Year Driving an Electric Car

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Editor’s note: In the article below, the writer uses the term “up to” several times in discussing potential yearly savings from driving an electric car. I understand the temptation to use such phrasing, and it’s quite common to do so, but it’s a highly inaccurate way of phrasing it for this topic. Annual savings depend on a lot of factors, and in doing an analysis like this, you have to make a lot of assumptions. I assume the analysis uses averages in every opportunity possible (average miles driven, average price of gas in the state, average price of electricity in the state, etc.). But averages are just averages. There are many people who drive far more than average, and if your operational costs are lower per mile, that means the higher the mileage you’re assuming, the higher the savings. Someone driving 30,000 miles a year is going to save a lot more money, all else being equal, from switching to an electric car than someone driving 10,000 miles a year. There are various other assumptions that could be changed and could make a big difference as well, such as the expected price of gasoline over the years of car ownership/comparison. We don’t know the future. If you’re trying to compare fuel costs (gasoline versus electricity) in the next five years, you’ve got to make some guesses about what the price of gasoline will be and what the price of electricity for that driver will be. Then there’s the even more complicated and challenging factor of depreciation! That and various other factors influencing cost are not even touched here. I’ve done dozens, or maybe even 100+, of these kinds of comparisons. From that experience, I think it’s important to note that 1) the outputs are based on a lot of assumptions, 2) there is no “up to” that makes any sense, and 3) the analysis done here most likely uses national averages and state averages everywhere possible — so just keep that in mind.

Thinking about an electric vehicle but not sure? When it comes to money spent of fuel, it’s a no-brainer.

The Energy Department has a new tool that enables drivers to calculate how much they can save on fuel costs by driving a fully electric or plug-in hybrid electric vehicle. Drivers can enter their ZIP code or state, as well as any additional information including vehicle size, model year, fuel tank size, fuel economy, and annual mileage into the calculator. The tool then generates estimates of how much drivers can save. The result? Savings of up to $2,200 a year for a fully electric vehicle, and $1,500 for a hybrid electric vehicle.

According to the Numbers

Created by Argonne National Laboratory, researchers found that no matter where you live in the country, you will save driving an electric vehicle. Plug-in hybrid electric vehicles saved drivers in over 99% of U.S. ZIP codes.

The largest savings were found in areas with high gasoline prices, low electricity prices, and where drivers drove longer distances, and used older, less fuel-efficient vehicles.

The savings calculator is based on Argonne’s recently published technical report, “Adoption of Plug-In Electric Vehicles: Local Fuel Use and Greenhouse Gas Emissions Reductions Across the U.S.” With this report, scientists shed light on new information that previously was not well understood: How local factors like vehicle age and choice, travel, fuel and electricity costs can affect an individual’s savings — and how they can reduce greenhouse gas emissions — depending on where they live.

Researchers found that states with older vehicles have highest potential to save with an EV. Idaho has the highest savings — up to $2200 per year — where less fuel-efficient vehicles are common along with high gas prices and cheap electricity. Washington and Oregon are also high on the savings list.

Notably, drivers in these states can expect large savings at the pump by choosing more fuel-efficient pickup trucks and SUVs:

• South Dakota — up to $1,700 per year
• Nebraska — up to $1,700 per year
• Montana — up to $1,700 per year
• West Virginia — up to $1,800 per year
• Arkansas — up to $1,500 per year

Louisiana — up to $1,300 per year

The report also examines the impact of greenhouse gas emissions, using a “well-to-wheels” approach, which considers the entire life cycle of a vehicle’s energy consumption. The researchers found that battery EV drivers can save close to 1 lb. of carbon dioxide per mile driven. This represents a greenhouse gas emission reduction of 75% compared to a conventional vehicle.

The numbers show EVs are a great option for drivers looking save on fuel costs and cut back on pollution in their community.

Calculate your savings at Local Fuel Savings | Department of Energy.

Learn more about accessing money-saving incentives at www.energy.gov/save.