EV costs in CA outweigh gas prices

The electricity costs for charging an electric vehicle could outweigh benefits, study finds

Update 2/8/11: California Electric Transportation Coalition says that EV owners have the option of receiving a special discount from utility companies allowing them to pay significantly less for charging their vehicles during off-peak hours.

As much as we all want to champion the underdog, there’s always a downside.  Such is the case for plug-in electric and hybrid vehicles.  As awesome as they sound, they will require a lot of juice.  Will the amount of electricity they consume make them more costly to maintain than they’re worth?

Wally Tyner, professor of agricultural economics of Purdue University, says yes—but primarily for Californians, who pay some of the highest electricity charges in the country.  California’s energy policies, which are aimed at cutting electricity usage and greenhouse gas emissions, result in the average Californian paying roughly 14.42 cents per kilowatt hour, which is 35% higher than the national average.  That could result in astronomical costs for those Californians who have to charge an electric vehicle or plug-in hybrid for upwards of eight hours a night. 

Tyner and other Purdue researchers developed a model that simulated the average California household and its energy consumption through the use of ordinary household appliances.  The researchers analyzed census data to make sure they used appliances that most California households use, and the model consequently closely mirrored the amount of energy the average California household uses. 

Exactly how much more could Californians expect to pay if they bought an electric vehicle? 

When the researchers added a plug-in hybrid vehicle to their model, energy consumption increased a massive 60%.  In other words, the average Californian that buys an electric vehicle could see his or her electricity bill balloon by more than 60%, as California is on a three-tiered pricing system, which charges higher rates as more electricity is used.  The pricing system is aimed at curbing the amount of electricity people use and giving them an incentive to turn off lights and unplug appliances when not in use, but that could backfire where electric and plug-in vehicles are concerned.

"Almost everyone in California reaches the third pricing tier each month. If they add a plug-in hybrid, they are charged the highest rate,” said Tyner.

But how will it compare to the cost of gas?  The study finds that electric vehicle owners will end up spending more for the electricity their cars consume than traditional gas-powered car owners currently spend on their vehicles.  In fact, an EV owner in California can only hope to spend less money than a gas-powered car owner if crude oil prices rise to $171 to $245 per barrel.  Right now, crude oil costs $91.54 per barrel.

"People who view the Volt as green will pay $10,000 more over the lifetime of the car because it's green," Tyner said. "Most consumers will look at the numbers and won't pay that."

This is not to say that electric vehicles are not economical in themselves.  Rather, Tyner suggests that if California wants EVs and plug-in hybrids to take off, it will need to reduce its current electricity prices.  States like Indiana that only charge $0.08 per kilowatt hour will see a much easier adoption rate because electric cars and plug-in hybrids will be much more economical to own there.  

And how much energy can California really spare for plug-in vehicles?  Remember California's energy crisis and the rolling black-outs a few years ago? California has the largest population of any state in the country--in theory, if every household in the state bought a plug-in electric vehicle, would the grid be able to handle that kind of overload? And if it set off another wave of rolling black-outs, which a few years ago left counties throughout California without power for hours, would that prevent people from being able to charge their cars, thus preventing them from being able to commute to work and elsewhere?

Image source: treehugger.com