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Electric Vehicle University - 220b ECONOMICS OF EV OWNERSHIP

What are the key factors that I should consider when I try to cost justify the purchase of an EV??

An introduction to the economics of EV ownership is presented. The EV purchase premium is discussed along with the qualitative examination of the factors that must be considered as an economic analysis is conducted. Fuel and maintenance costs, including battery replacement issues, are explored. To obtain a copy of the EVU study guide for this and other available EVU courses, please complete the form on this page.

Course level: Intermediate

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Electric Vehicle University - 220b ECONOMICS OF EV OWNERSHIP

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  2. 2. 2 EV Economics— Basic Concepts, part 2 EV-220b This course is presented as part of Evannex University—a free, open learning environment that presents concise, video-based mini-courses for those who have interest in electric vehicles (EVs) …
  3. 3. Looking back at part 1 … You will pay a premium to purchase an EV, mostly due to high battery costs An economic analysis must take the premium into account Both qualitative and quantitative considerations Savings do exist but are affected by many factors 3 ?
  4. 4. EV—Cost of ownership Overall cost of Ownership =  Fuel costs +  Resale value +  Maintenance costs +  Repairs  Consumables  Support costs  Insurance  Financing costs  Build a home charging infrastructure  Tax credits
  5. 5. Fuel Cost  Project fuel costs  Gasoline today and in the future  Electricity today and in the future  Use fuel efficiency data  MPG  MPGe  kWh per mile  Use # of miles per year and # of years of ownership
  6. 6. Resale value  First, note that the used car market for EVs is very new  However, early data indicate that  Small BEVs take a resale value hit  Large BEVs depreciate at about the same rate as comparable ICE cars  PHEVs do considerably better than BEVs
  7. 7. Maintenance Costs “ … electric vehicles partially compensate for high initial purchase prices by granting owners savings up to 35 percent in maintenance costs.” The Institute for Automobile Economics (IFA) electrics-35-less-costly-maintain- comparable-ice-vehicles-125755.html Maintenance ICE BEV Oil change 10 changes 0 Fluids 1 change 0 Tires 2 changes 2 changes Muffler 1 change 0 Brakes 1 change 0 Transmission Service possible none Plugs Service possible none
  8. 8. Battery Replacement  A cost worth considering in an economic analysis, but it’s not as serious as the hype indicates  BEV batteries can lose as much as 10% of their capacity at 50,000 miles and about 20% at 100,000 miles  But a mildly degraded battery still works fine.
  9. 9. Summary There is a cost premium Costs of owning an EV break down into the same categories as the costs of owning an ICE vehicle:  Fuel costs  Depreciation  Maintenance costs  Support costs Overall, the long-term costs of owning an EV are demonstrably lower
  10. 10. 10 … a free study guide for all EVU mini-courses is available for download from our website … For a complete list of mini- courses and the study guide, visit: