# When Cheap Gasoline Really Isn’t

Recently, an automobile exec said something along the lines of “With gas at \$2/gallon, I am not worried about electric vehicles.”  It was a bold statement that piqued my curiosity.  There are lots of good reasons to buy an electric vehicle from reducing green house gases to getting access to the HOV lanes, but how about simple pocketbook economics?

• The average price of for a gallon of regular gas in California as I write this is \$2.94 (source: US EIA)
• The average price of a gallon of regular gas nationally as I write this is is \$2.26 (source: US EIA)
• Average fuel efficiency is 24.8 mpg (source: EPA)
• The average driver travels 13,475 miles each year (source: US DOT)

Based on that data and a bit of math, we can conclude the following:

• It costs the average CA driver \$0.11 to travel one mile or \$1,597 per year
• It costs the average US driver \$0.09 to travel one mile or \$1.228 per year

What about EVs?  Well, we obviously don’t measure miles per gallon, but we use a similar concept: we measure how many watts (Wh) of electricity an EV consumes to travel one mile.  If we look at the two current Tesla models and stick with EPA data for consistency, we find the following:

• Tesla Model S 75D has an efficiency of 330 watts per mile (Wh/mi)
• Tesla Model X 90D has an efficiency of 370 Wh/mi

Next, we have to figure out what electricity costs. This is going to vary by geography, but lets look at a couple of utilities in northern California:

• SMUD has a Time of Use (TOU) EV rate of \$0.0766/kWh for off peak use which is when most folks charge
• PG&E has a TOU EV rate of ~\$0.12/kWh for off-peak charging

To figure out the EV cost per mile, use the following formula:

(( E x 1.1 ) / 1000) x R

• E = efficiency (Wh/mi))
• 1.1 = covers represens 10%  losses form your home charging equipment
• 1000 = converting from watts to kilowatts
• R= the rate your utility charges you (\$/wWh)

So, if we do the math for the Model S in SMUD’s region we have:

(( 330 x 1.1) / 1000) x 0.0766) = \$0.028

…or a little under 3 cents per mile or \$375 for the year.  I am laying out the math so you can plug in your own numbers, but if we run the rest of the scenarios, we get:

• Model S 75D (PG&E): \$0.044/mile or \$587/annually
• Model X 90D (SMUD): \$0.031/mile or \$420 annually
• Modle X 90D (PG&E): \$0.049/mile or \$658 annually

So, even if you look at the worst EV scenario (Model X 90D, PG&E rates) against the best case  gasoline scenario (US average pricing), the Model X still costs 50% less to fuel.  To play with the numbers a bit more, gasoline would need to hit ~\$1.10 a gallon to match the cost-per-mile of the Model S 75D in PG&E territory or conversely you would have to buy a car car that gets more than 67 miles per gallon.

I am guessing the exec was hoping you could not or would not do the math on his statement.  Guess what, now you can! 🙂

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