Electric vehicles and your wallet

You will save on maintenance and energy costs, but your EV will depreciate faster then a gas-powered vehicle

By Eric Novak

Jun 15, 2021 5 min. read

Article was updated a year ago

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With approximately 20 new models expected in 2021 and 2022, full battery electric vehicles (EVs) are no longer a niche option for buyers. Several automakers including Ford, General Motors, Volvo, Jaguar and more have committed themselves to transitioning away from gas-powered models and instead only selling full electrics over the next 10 to 15 years.

With EVs moving from a limited market to mainstream vehicles suitable for all, it’s time to shift away from focusing on how far an EV can drive on a battery charge and look at the associated costs of owning and operating one. While it still costs more to buy or lease an EV, the overall cost of ownership includes more than a simple monthly payment.

Charging versus gassing

All vehicles are powered by energy, whether the converted energy that comes from the combustion of gasoline in an engine, or from stored energy in the form of electricity that is housed in batteries. A huge cost advantage for EV’s comes from the fact that our electricity prices are much less than the price of gasoline.

Illustrating the advantage can be done by taking the Hyundai Kona, which is offered as both a gas-powered and a fully electric version, and calculating the energy costs to drive each 100 kilometres. To calculate the cost for the gas-powered version, the combined fuel economy rating of 8.6 litres per 100 kms was multiplied by the price of per litre of regular gas, $1.25, which was the average price at the pumps when this story was written. For the electric Kona, the total was calculated by taking the posted combined energy rating of 17.4 kilowatt hours (kWh) per 100 kms and multiplying it by the current Ontario off-peak rate for electricity, 8.2 cents per kWh.

[caption id="attachment_159761" align="alignnone" width="2560"]Hyundai Kona 2019 Hyundai Kona EV
Uploaded external by: Cole, Craig[/caption]

The cost to drive the gas version of the Kona would be $10.75, while the cost to drive the electric variant is $1.43. This would be a savings of $9.32, or 87 per cent. If gas prices dropped to $1.00 per litre, the cost would decrease to $8.60. If you decided to charge your EV during peak usage periods, it would cost 17 cents per kWh, increasing the amount to $2.96. Your savings would drop to 65 per cent.

Prices of both gasoline and electricity can vary across the country and throughout the year, however Canadians seem to be very competitive when it comes to typical costs to charge up their EVs. According to U.K. based Uswitch, a price comparison service, in 2020 it cost the average Canadian $277 to charge their EV. Canada was among 50 countries included in a report, faring better than the U.S., New Zealand, the U.K., Italy, France and Germany, where citizens paid more than three times that amount.

Vehicle maintenance

Another cost advantage that works in favour of EVs are ongoing maintenance costs. Gas-powered vehicles are complex machines, with hundreds of moving parts in each of the drivetrain and powertrain. Electric vehicles, by comparison, have about 20. There are no scheduled oil changes for EVs, and most maintenance issues can be done via cloud-based overnight updates while your EV is plugged in and charging overnight.

The cost savings associated with EV ownership is becoming one selling features some automakers are highlighting to potential buyers to offset the higher purchase price. Kia Canada has created a special section on its website dedicated to electrified powertrains, as well as providing tools to highlight the cost savings of the EVs and hybrids in their line up, including a maintenance estimator. Michael Kopke, director of marketing at Kia Canada, explained in an interview that the decision to set up the section was because electric vehicles in Canada are still nascent, and the need to educate and inform consumers was something they felt would be helpful.

Adding it all up

Of course, the cost of vehicle ownership goes beyond energy and maintenance. Depreciation in value is one of the biggest costs for any vehicles and this is one area where traditional gas-powered vehicles still have an advantage. It’s not that EVs are built poorly by comparison but rather because EVs tend to depreciate faster as newer models – with better battery technology – come on the market.

A popular tool to determining overall vehicle ownership costs is provided by the Canadian Automobile Association on its website. Its Driving Costs Calculator looks at the total cost of ownership and includes both battery- and gasoline-powered vehicles.

Using the Hyundai Kona as an example, the feature calculated the gas-powered Kona driven 20,000 kms per year in Ontario would cost $10,306.25 annually. By comparison, the Kona EV, using the same details, would cost $9,410.86, for a savings of $895.39 or almost 9 per cent. It also noted that while the Kona EV had significantly lower costs for energy and maintenance, the insurance cost was higher, and the depreciation was more.

As electric vehicles continue to grow in popularity, what will continue to drive their growth is not only the fact that they are a better choice for the environment, but that they also tend to be a better choice overall for your wallet.


What owners said

We reached out on Facebook to a few EV owners to find out what costs they have experienced with their vehicles. Stephen Fung of Coquitlam, B.C., has been driving a Chevrolet Bolt EV for two years and said he has spent no more than $500 on maintenance in that time, with most going to the purchase of windshield wiper fluid. Devin Arthur of Sudbury, Ont., who is a member of the Toronto Electric Vehicle Association’s Facebook group, also owns a Bolt and, like Fung, said that outside of windshield wiper fluid his maintenance expenses have been virtually nothing.