Electric Car Real Economics

2011 Chevy Volt

2011 Chevy Volt Electric Car

When I was at the 2010 San Francisco Auto Show, I had a chance to explore the Chevy Volt and Nissan Leaf in considerable detail. I was particularly impressed with the Chevy Volt. It is a nice looking car, and seems to have impressive features. It actually had me thinking about trading in my gas guzzler for an electric vehicle. It also got me started asking a lot of detailed questions to understand better understand the electric car, and in particular, the economics of the electric car. This has left me far from being an expert, but has left me with a lot of questions about the real economics of operating an electric car.

2011 Nissan Leaf Electric Car

2011 Nissan Leaf Electric Car

While in line to test drive the Nissan Leaf, I was standing beside a guy that works for PG&E. He seemed in favor of electric cars, but had a concern about the real energy costs once you get one. Ideally, someone working for an energy company should know what he is are talking about. But, I’m taking nothing at face value. I’m trying to get real numbers, from people with real experience owning an electric car. I realize there aren’t many of you out there, but if you own an electric car, and have real experience with the true economics, please jump in on this discussion.

Putting together what little information I know, and what the guy from PG&E told me, I don’t see how the economics could ever make the electric car less expensive to operate than a gas vehicle. Here is what I understand.

About 80% of our personal energy costs are related to our home or residence. Energy costs related to transportation is about 20% of our personal budget. Yes, these are very rough numbers, but should be good enough for this analysis. At $0.10 per kWh for charging, the cost being used by Nissan, an electric car is about 1/6 the cost per mile of a gas vehicle. So theoretically you are saving about 1/6 of 20% of your budget. However, according to the guy from PG&E, if you start charging an electric car in your garage every day your higher energy consumption would put you in a higher energy cost bracket. Basically, you become classified as an “energy hog.” This would probably move you from paying the $0.10 per kWh used by Nissan, to about the $0.50 per kWh price range. This means 5X the 80% part of your personal energy costs.

Clearly increasing 80% of your energy costs by a factor of 5 far outweighs the 1/6 savings on 20% of your energy costs. If these numbers are correct, this could once again “kill the electric car.” I would really like anyone with first hand experience to jump in on this discussion with some facts. I’m hoping my numbers are flawed in some way. For now, my thoughts of buying an electric car are put on hold.



  1. We have been using electric cars in the UK for the last 4 years. In 2006 we purchased a Reva G-Wiz and in December 2009 we started a trial with the Mitsubishi i MiEV.

    During the year we have completed various tests and are hoping to complete a couple more before the trial is due to finish in December 2010. The results can be found on http://www.owninganelectriccar.com website.

    • Angela, the link in your comment doesn’t seem to work. Is there a problem with the URL, or is the site not up yet?

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