In this post, we’re going to look at one fundamental question many ask when considering whether to swap their gas, diesel, or hybrid car for an electric vehicle: Is charging an EV cheaper than filling a car up with gasoline?
Spoiler alert: The answer is more than likely “yes”.
But before we get into it, let’s start at the start: A key barrier to EV ownership is how expensive they’re perceived to be. And while for a time, this may have been true, the price of purchasing an EV is dropping quickly.
As the prices of EVs drop, running costs—including, charging costs, tax, insurance, lifespan, and maintenance—are likely to play more of a part in consumers’ decision-making process.
However, these prices are already considerably lower for EVs. According to the Electric Car Cost Index from insurance firm LV=, electric vehicles are, on average, half the price to own compared to their petrol and diesel equivalents due to a longer life span. They also require less maintenance, have favorable tax incentives, and—you guessed it—cheaper fueling costs.
So, is charging an EV cheaper than filling up with gas? More often than not, the answer is “yes,” however it’s complex and depends on a range of factors which we’ll dive into below.
Electric mobility is on the rise
All over the world, the types of vehicles on our roads are changing. What began with Tesla’s rise as a challenger vehicle manufacturer has grown into the beginning of a worldwide transition to electric mobility. The first electric vehicles which were viable alternatives to vehicles with internal combustion engines (ICE) only hit the road in the 2000s, and in the short time since they already make up more than 10 percent of the vehicles sold across much of Europe.
This rise has been driven by strong interest from drivers, favorable government regulations, and a rush to reduce the carbon footprints of both businesses and buyers alike.
Across the pond in the U.S., the Biden administration has introduced a 50 percent electric vehicle (EV) target for 2030. These aggressive targets have, in turn, pushed many vehicle manufacturers including Ford, BMW, and Volkswagen to step up their game and align climate commitments.
Simply put: it’s still uncertainties over price. Two of the main concerns for consumers on the fence,according to our research, are the price tag of EVs and how much they will cost to run, especially when compared to gas alternatives.
Is EV charging cheaper than gas?
The first thing to look at when determining whether an EV is cheaper to run than a gas car is electricity and gas prices, which for obvious reasons depend on a range of factors.
On top of this there are plenty of other things that come into play including fuel economy, government regulation, and the type of engine the gas car has.
However, according to a report by Kelley Blue Book, a California-based vehicle valuation and automotive research company, the answer is not “if,”but “how much” you will save. Let’s look at a few key factors to determine how much it costs to charge an EV or a gas car.
How much does it cost to fill up a vehicle with gas today?
When it comes to gas prices, there are a few factors that determine how much you’re going to pay at the pump. While taxes, distribution, and refining costs make up roughly 45 percent, the cost of the crude oil itself commands the lion's share of gas prices.
When the price of crude oil fluctuates—as it often does due to the law of supply and demand, global crises, and political factors—we see prices at the pump rise and fall. Since the beginning of this century, the price of gas in the U.S. has experienced significant fluctuations. According to research by the U.S. Energy Department, the retail price for a gallon (3.78 liters) of transportation fuels (petrol, diesel, propane, ethanol, etc.) is highly volatile and differed by $2.90 over the period between 2000 and 2016 from a low of $1.46 per gasoline gallon equivalent (GGE) to a high of $4.36 per GGE.
As a result, the price of oil in each country fluctuates, but you can check the average price in your country here. However, most of the EU and the UK sit between $1 and $2 per liter, and the U.S. hovers just below $1 per liter. On the other end of the spectrum, the Netherlands and Hong Kong have the highest gasoline prices on the planet, going above $2 per liter.
Type of engine
The type of engine plays a major role when determining fueling costs and is something that many consumers take into account when deciding to purchase a new gas car. Here’s a brief analysis of the ICE market today:
Gasoline engine. The majority of passenger vehicles are equipped with gasoline-powered ICEs. These vehicles generally burn the most fuel per mile, emit the most CO2, and cost the most to run, although differences with diesel and hybrids are becoming negligible as all have become more efficient over the years.
Diesel engine. In comparison to their gasoline counterparts, diesel engines consume 10-20 percent less fuel thanks to more efficient engine operations. These saving efficiencies are due to burning a heavier, more energy-dense fuel which is more efficient but also costs less than gasoline. On average, the worldwide cost for diesel is $1.07 per liter versus $1.20 for gasoline. However, diesel also emits more pollutants than gasoline and is subject to higher taxes in certain parts of the world.
Another determining factor to consider is the size of the vehicle. The heavier a vehicle is, the more energy is needed to move it. Heavier vehicles have greater rolling resistance, which in turn, contributes to increased fuel consumption. As a standard, lighter vehicles tend to be more fuel-efficient and better for the environment as well as more cost-efficient to run. The general rule of thumb is that the bigger the car, the more expensive it will be to run. However, weight factors impact cars with ICEs more than hybrids and electric vehicles, which can recover a portion of the energy lost.
Fuel economy per vehicle
A vehicle's fuel economy is essentially how far it can drive on a specific amount of fuel. One common way to measure this is liters per 100km (or gallons per 100 miles).
When calculating how much it costs to fill up a car with gas, this is an essential number to know. Loosely speaking, anything under 8 liters per 100km is pretty good, between 8 liters and 12 liters is average, and anything over 12 liters is considered a relatively low fuel efficiency. For instance, at the low end of the spectrum, a Honda Civic—considered one of the most fuel-efficient, gas-only cars by the U.S. EPA—has a fuel efficiency of around 7 liters per 100km.
Another consideration when it comes to fuel economy is the government levies and taxes on vehicles with low fuel economy ratings, high levels of pollution, or heavier vehicles in general.
For instance, in the US, vehicle manufacturers are already required to pay a "gas guzzler" tax on the sale of cars with exceptionally low fuel economy like the Lamborghini and Bugatti mentioned above. Additionally, in some countries like the Netherlands, how much road tax you pay depends on the weight of your car as well as how much pollution it emits.
When you’re driving a gasoline or a diesel vehicle, calculating fuel costs is quite easy. You know how much you’re used to paying per liter and you know how much it will cost on average to fill up your tank. When it comes to the cost of charging an electric vehicle, it is a little more complicated as there are different levels of charging, which all come with different costs. These depend on several factors, including where you charge, the price of electricity, and at what time you charge.
If you purchase and install an AC charging station yourself, (or if you use the Level 1 cable that came with an EV upon purchase) you will typically pay the lowest price per kilowatt-hour (kWh)—the electric equivalent of a gallon or liter of fuel.
As you use your residential energy supplier, there is no “middle-man” charging extra for the service and you’ll simply pay the price you pay for electricity at your home.
However, home charging is generally slower than public charging stations as the power output of a home is often lower. Check out this page for everything you need to know about charging an EV at home, including charging times at different kWh outputs, and the different charging station options available.
How does this translate when charging an EV? Well, if you're looking to fully charge a Nissan Leaf with a 62 kWh battery in Europe, you'll pay around $15 with a maximum range of 364 km.
However, if you’re looking to charge a Tesla Model X with its larger, 95 kWh battery, it will cost closer to $23 with a range of up to 625 km.
Why you should charge at low-peak times
Additionally, electricity costs change at certain times of the day. You'll likely pay more for charging during the day than at night—typical off-peak hours when not as many people are using electricity.
Typically from 10 p.m. till 7 a.m., pricing during off-peak is the lowest price available. For instance, in the UK, off-peak charging costs £0.09 per kWh ($0.12) whilst on-peak charging costs £0.20 ($0.27). For this reason, if you charge your EV late at night or early in the morning, you can save money on your electricity bill and your overall charging expenses.
These numbers depend on the country you live in, your car's charging capacity, the fees you pay to your energy supplier, and at which time you charge.
Fuel economy for electric vehicles
An electric vehicle’s “fuel efficiency” is based on the number of kilometers that the vehicle does on a single kilowatt-hour (kWh).
As an average small electric vehicle can travel 6,5 kilometers (4 miles) per kWh, if you typically drive your car 1,600 km (1,000 miles) a month, then you’ll need at least 250 kWh to charge it properly.
Public charging is more expensive than charging an EV at home as the location sets the baseline cost of energy, however, it is often faster than charging at home too. According to EIA, the July 2021 national average for commercial electricity is only $0.11 per kWh while in Europe, that number in the second semester of 2020 was €0.12 per kWh.
However, when you charge at a public charging station you also pay for the service. The tariff is based on the location you charge at, the network you use (the roaming fee), the time you charge, the number of kWh you consume, as well as a potential membership fee the supplier may decide to charge you.
Generally speaking, however, public charging will always be more expensive than charging at home. One thing is for certain, public charging is a lot cheaper than filling up your tank with gasoline.
Fast charging, also known as level 3 charging or DC charging is capable of charging a vehicle within minutes as opposed to hours. Fast chargers are significantly faster than regular AC charging stations, taking between 15 and 45 minutes to charge most passenger electric vehicles up to 80 percent—making it quick and easy to charge on the go.
Fast charging is, however, the most expensive public charging option and can double (or in some cases even triple) the cost per kWh. With fast charging, you’re paying for the convenience of charging your vehicle quickly. The price difference, however, depends on the location which you charge and whether the charging station bills by the minute or by kWh.
The price of fast charging is more comparable to the price of filling up with gas, however, it’s often still lower than filling up your tank at a gas station. For more information on fast charging stations and answers to all the frequently asked questions on the subject, check out this page.
So yes, it’s usually cheaper to charge an EV than fill up with gas
With all the variables, it’s potentially best to look at the average amount which is spent on gasoline costs per year per vehicle. The typical American family spends $1,991 on gas in 2019 driving an average of about 21,000 kms (13,000 miles) a year while in the Netherlands—a smaller country where gas prices are significantly higher—the average driver spends on average€1308 ($1535) a year on gas. In the UK, that number sits around £1436 ($1960) a year.