Eight Ways to Save Money With an Electric Car

By · March 18, 2014

Electric cars are high-tech driving machines. As such, they often carry a higher upfront cost compared to similar gas-powered cars. But putting one in your driveway gives you a powerful economic tool to lower daily operating expenses, and thereby recoup that initial investment. In fact, driving electric is about three times cheaper per mile than gas. Here are eight ways for you to save money with an EV.

1Avoid the Pumps

The cost of a gallon of gas, over the past five years, has hovered between $3.50 and $4.00 a gallon. Compare how far that gallon will take you with the efficient mileage from a kilowatt-hour of electric juice—which commonly costs about $0.12 a kWh. The electric car is the clear economic winner. The U.S. Department of Energy estimates that owners of the Nissan LEAF and Chevy Volt, for example, will respectively save $550 and $950 a year in fuel costs—when compared to a 23-mpg gas car driven 15,000 miles.

2Switch to Time-of-Use Utility Rates

If you could reduce the cost of home electricity even further, then your annual electric bill for your electric car will logically also drop. This is not a pipe dream. Many utilities offer special time-of-use rate plans for EV owners, to encourage charging in the middle of the night when the grid has a surplus of energy. Pricing varies across the country but a quick rule-of-thumb is that signing up for one of these EV TOU plans—and making sure to only charge when the rates are cheapest—can slice your electric car fueling prices at least in half. Call your local utility to inquire about time-of-use plans.

3Buy Home Solar

Installation of home solar power, in recent years, has gone from a niche west coast phenomenon to a mainstream trend. What held back many homeowners was the long payback period to recoup the upfront cost of buying solar panels. Consumers didn’t want to wait decades before the investment was covered, and the solar panels could start generating home power—free and clear.

Creative financing packages, with little or no money down on solar panels, were a big help. And now homeowners with home solar can see an even faster return if they drive an electric car. Here’s why: with the combo of EV and PV (photovoltaics), the ROI calculation is not about comparing grid-electricity versus solar-electricity. It’s about replacing $4 gas with much cheaper power for your car provided by your solar panels—even when the cost includes your investment in solar panels. And when the panels are paid for, your vehicle fuel will be generated on your roof at no additional cost, courtesy of the sun.

4Charge for Free, in Public

In this early phase of the public charging industry, many EV fueling spots are absolutely free. While some of those locations are shifting to a fee basis, other spots will continue to remain free—as an incentive offered by car dealerships or local retailers. Tesla has a long-term commitment to offering free charging at its highway-based Supercharger locations. Considering the low cost of electricity—and the desirability of attracting EV owners as customers—free charging is unlikely to go away anytime soon. Most electric car charging takes place at home, but free power for your car at a public stations (as long as it lasts) is a nice added perk.

5Charge for Free, at Work

For the same reason that some carmakers and retailers are offering free public charging, progressive employers and home property owners are setting up low-cost and no-cost charging stations. Happy employees reduce costly worker turnover. Grateful renters help maintain occupancy rates. And the installation of EV chargers for zero-emission cars helps establish green cred for all kinds of businesses. If you’re lucky enough to benefit from this kind of enlightened patronage, you are saving even more money in EV operating costs.

6Pay Flat Monthly Fee for Charging

The vast majority of EV owners want to pay for electric fuel by the kilowatt-hour—rather than by a per-charge or per-hour basis. After all, it’s only fair that you pay for the usable amount of energy you receive, just like you pay a set price for a gallon of gasoline. However, the eVgo charging network and a few utility companies offer a flat monthly fee for charging. For example, in Texas, for $29.95 a month, eVgo will install and maintain your home charging equipment and provide “all you can eat” charging. An additional $20 a month grants unlimited access to public Level 2 and DC Fast Charging stations.

At first blush, that doesn’t sound like a great deal—but when you deduct the cost of the charging station, and if you are a long-distance commuter that puts 1,500 or miles per month on your car, a flat fee can save you money. It also takes the guesswork out of monthly fuel costs. Based on our back-of-envelope calculations, $50 a month for 1,500 miles of fuel pencils out to a little more than three cents a mile. The cost to fuel a 30-mpg car for that same distance, at $3.50 a gallon, is $175. That leaves $125 in your pocket every month.

7Lower Your Maintenance Costs

EVs benefit from not requiring oil changes or other maintenance costs for exhaust systems. Studies have shown that this represents a 35 percent decrease in cost over time. Some calculations peg this to about 3 or 4 cents per mile of maintenance cost in an EV versus closer to 6 cents in an internal combustion car.

8Ditch Internal Combustion Entirely

Given all these economic advantages of an EV over an internal combustion car, why would you want one of those gas-thirsty money-draining monstrosities around? Some EV owners keep one, just in case you need to go on a road trip, requiring long distances and quick fill-ups.

On the other hand, the growth of car sharing and ride sharing services makes it easy to augment the EV in your driveway with the occasional gas-powered road trip. A number of car companies, like BMW and Fiat, are offer car rental vouchers for its EV owners. And the emergence of robust, extensive fast charging networks—like Tesla’s Superchargers—makes it possible to go petroleum-free.

What Are You Waiting For?

You know that liberating feeling when you unsubscribe to the cable television, land line or home security service that costs money every month, but you almost never use? That’s what you’ll feel when finally ditch your gas car.

Comments

· · 3 years ago

"What Are You Waiting For?"
Model E for a decent range & pricing and the actively cooled battery. Not to mention the capability to travel with the superchargers.

· · 3 years ago

It is past time for a(nother?) survey of the percentage of EV drivers who also have PV. There is a much more nuts and bolts article published on Plugin Cars that covered this same ground 9 months ago - http://www.plugincars.com/solar-powered-electric-car-charging-business-m... But I suspect some of its observations regarding the impact of EV charging - at least Level 2 - on the grid may be flawed, e.g. "when in reality most of our (EV drivers') electricity comes on-renewable sources"

My guess is that a large percentage of EV drivers, at least in the Southwest and maybe Florida, also have enough solar to cover charging their cars as well as providing for home use. In practice, this means large surpluses for utility companies during periods of peak demand. It is highly unlikely that many - if any - of those private installations have home superchargers.

· · 3 years ago

Point #5 is what is causing the charging rages at work....

B/c EV owners are so CHEAP that they try to save few quarters....

· · 3 years ago

@MMF - Yes, providing something for free and then not providing enough for everyone who wants it is a recipe for disaster. Charging a small fee, even below cost, will probably relieve the congestion.

· · 3 years ago

People think they need range, but those of us that are already enjoying an EV know that range is not nearly as important as people think. 62 miles is more than enough for me and many others. I hate car stealerships and I hate big oil, I kill two bad birds with one EV stone.

· · 3 years ago

@MLucas
That depends, for me its just not an option as my daily commute is 130km with no charging option at work.

· · 3 years ago

Solar panels? That seems like a pretty expensive way to save money. Sure, you can justify it when you're replacing gas, but grid power is still cheaper than solar, especially after installation costs.

· · 3 years ago

@MLucas & lewille - There are all kinds of work-arounds for people really committed to driving electric. For example, lewille could pack a portable Level 2 charger if there is a 220 (or whatever it is where they speak metric) electrical outlet available at work. But just because people 'can' doesn't mean it is reasonable to expect them to actually do it. Even a reasonably priced EV battery that allows a car to be driven say 200 miles will not solve the quick-charging infrastructure problem (for someone who needs to regularly drive 201 miles) that is likely to plague all-EV driving for some time to come.

My question is: what is reasonable for someone like lewille? Should (s)he drive something like a Prius at 50-60 mpg or a Volt at 37mpg - which could make roughly half of that 130km driving all-electric? Even though I almost never use gas in my Volt since I started driving a RAV4 for 30 mile trips up a 6000 foot mountain, I can very much understand why range anxiety is killing EV sales. It is the exception that kills the rule.

In summary, it seems to me that range-extended EVs like the Volt are THE ANSWER for those of us who would like to see as much of the world as possible driving electric.

· · 3 years ago

The car is so expensive. But recent evidence indicates that drivers are increasingly willing to pay the going rate to drive an electric car.

· · 3 years ago

Bravelittletoaster, where exactly do you live? I have a 4kwh panel system in Utah, some of the cheapest electricity in America, and the panels will still pay off in 8.6 years with an over 30 expected life span. And that is assuming electric rates don't go up. Which they keep doing. Where do you live that solar costs more than the grid?

· · 3 years ago

@Shen,

I have to assume that Utah has some generous incentives for solar panels. In New York, my out of pocket was about 25% of the system cost. Even with more expensive electricity (11cents / kWh), my expected pay off isn't for about 10 years.

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