PHOENIX – Rising gasoline prices have some Americans thinking about buying an electric vehicle. It's a big financial decision, especially since Republicans ended federal subsidies last year worth up to $7,500.
Guadalupe Higuera, 30, of Phoenix, Ariz., bought his Chevrolet Equinox EV before that incentive ended. But he still wonders if it was a smart choice. Higuera responded to NPR's request for questions about reducing your climate impact and saving money.
"At what point does it make sense to ditch a gas car for an EV?" he asked. "Does it make sense to replace it at a certain age or mileage? Or do we just drive it until the wheels fall off?"
Higuera says his question is motivated by both saving money and reducing his contribution to the greenhouse gases that are warming the climate. After investigating his question, the answer, as far as climate pollution is concerned, is clear: it makes sense to switch to an EV now. On saving money, the answer is more complicated. But Higuera concludes that switching to an EV was a good financial choice, too.
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"Drive it until the wheels fall off"
One reason Higuera questioned his decision was that nothing was wrong with his previous car, a 2016 Jeep Wrangler. And his family has owned an auto repair shop, north of downtown Phoenix, since before he was born. So, he grew up with the idea that it's wasteful to get rid of a car that still runs fine.
"I remember having that conversation with my parents [and] my older brother, before I got my current car," Higuera says. "And they're like, 'your car — we can keep fixing it. It's still good. There's nothing wrong with it.'"
Americans are keeping their vehicles longer. The average age of cars and light trucks on the road increased to 12.8 years, according to the U.S. Bureau of Transportation Statistics. Often, a big factor in deciding whether to get a new car is repair costs, according to AAA. And not everyone has the benefit of getting the family discount for repairs, as Higuera does.
There are lessons for everyone considering an EV in answering Higuera's question. We set out to compare the costs of keeping his Jeep with buying his EV. And we used a tool that calculated typical repair costs (not his family discount), so the comparison can be useful to others.
When an EV saves money
Comparing the cost of a 10-year-old Jeep to a year-old Chevy EV gets complicated and involves more than just the cost of fuel. For example, while maintenance is cheaper for a newer EV, insurance costs are higher because they include parts, such as batteries, that are expensive to replace.
There are some websites to figure out costs for new cars, such as Consumer Reports and Edmunds. You can also find helpful calculators with specific information, such as this fuel-savings calculator that Oakland, Calif. resident Andrew Krulewitz developed for a car dealership that sells a lot of EVs. It allows you to adjust the number of miles driven each year, electricity costs, gas prices and vehicle efficiency.
To compare a more complete list of the costs for Higuera's 2016 Jeep and his 2025 Chevy EV, NPR Cars and Energy Correspondent Camila Domonoske chose a federal Energy Department calculator. It includes fuel, tires, maintenance, registration, license, insurance and a loan payment.
Working with Higuera, she started with a $0 cost for his Jeep, since he already owned it. For the EV, she entered $23,000 ($45,500 purchase price, minus the $7,500 tax credit and $15,000 from selling the Jeep).
The calculator figured his electricity cost based on the state where he lives, Arizona. Then Higuera and Domonoske entered the gas price in Maricopa County from AAA. In early May, when they made these calculations, that was $4.95 a gallon. The price has gone down a little since then.
Higuera says he drove 21,300 miles last year — that's nearly 9,000 miles more than an average driver. His software developer job at a big bank is about 35 miles away and his girlfriend lives on the other side of the Phoenix metro area. The tool allows you to estimate what percentage is more efficient, highway driving or city driving — 40% city and 60% highway, in Higuera's case.
With all the information entered, the costs of owning and operating both vehicles pops up on the screen.
"It's saying $10,456 for your cost of ownership on an Equinox in year one, versus $8,000 to have continued to own the Jeep." Domonoske tells Higuera over a video call. But after that first year the two lines on the graph narrow. After five years the Equinox, cumulatively, costs just $1,000 more, she says, "and then from there on, it's cheaper to own the Equinox."
"This makes me feel a little bit happier, financially-wise, because I didn't really expect that the cost would be pretty much exactly the same, and then it gets cheaper down the line," Higuera says.
A few factors make Higuera's calculation work out financially, including his ability to take advantage of the $7,500 tax credit that no longer exists. Also, he drives so many miles each year, and his Jeep's gas mileage averaged only around 20 miles per gallon.
"This would look really different if your 2016 vehicle had been a Prius," Domonoske tells Higuera. That Prius averages 52 miles per gallon, so gas costs would be less than half the Jeep's.
One expense this tool doesn't consider is depreciation. After five years, the Equinox, as a newer vehicle, would drop in value faster than the already 10-year-old Jeep.
Jeremy Michalek, director of the Carnegie Mellon University Vehicle Electrification Group, performed some calculations that included a scenario in which both cars were sold in five years to factor in depreciation. He says there are a lot of uncertainties with making such calculations, but Michalek suspects even with the extra depreciation, Higuera saves money with the Equinox.
There are benefits in driving a new vehicle too, like fewer repairs. "I'd say the Equinox route is likely the better value for Guadalupe," says Michalek, who is also a professor of engineering and public policy at CMU. He says that because climate change also figured into Higuera's decision, the Equinox EV makes even more sense for him.
EVs are a climate solution
The Energy Department tool that Domonoske and Higuera used to determine his cost savings also considers where the electricity his EV uses comes from — and more than half of Arizona's electricity is generated by burning gas and coal.
Even though so much of the electricity comes from burning fossil fuels, the tool shows Higuera is still cutting his carbon dioxide emissions 80% by ditching his Jeep for the Equinox EV. Part of the reason is that EVs waste less energy. While internal combustion engine cars put less than 25% of the energy in gasoline to use, EVs use about 90% of the energy in electricity to turn the car's wheels.
But Higuera says he's also heard EVs have more pollution associated with manufacturing.
"It is true that manufacturing electric vehicles involves higher emissions intensity than manufacturing gasoline vehicles," Michalek says. "But you can earn that back pretty quickly by using electricity instead of gasoline."
So, just as EVs cost more up front and save money in the long run, they emit more pollution up front and much less over time. How long that takes depends on the EV and the energy mix in the region where you live.
"Because the power grid in some areas of the country, like the northern Midwest, are still quite dirty — very coal heavy. And some, like the West Coast, are very clean," Michalek says. "How long it takes to drive your electric vehicle to make up the manufacturing emissions is pretty short in California and much longer in Wisconsin."
Higuera says he usually charges his EV at night, when his local utility rates are the cheapest. That raises another concern for him.
"Where I live, we have a lot of solar — we have a lot of sun — but the sun is not up when it's dark out," Higuera says. He worries that's encouraging his utility to burn more natural gas to generate the electricity that feeds into his EV.
Michalek and his colleagues have researched this and found that charging when rates are cheapest encourages utilities to build more of the cheapest forms of electricity generation, which also happen to be the cleanest.
"You actually create incentives to build a ton of wind and solar, possibly so much wind and solar that the net effect of charging your electric vehicle can be to reduce the total emissions from the power grid," Michalek says.
Ditching gas for electric makes sense
Sorting out questions like these are complicated because switching to an EV touches on the two largest sources of greenhouse gas emissions: transportation and electricity generation. That can make it difficult for researchers who dwell in the details, like Michalek, to offer a simple answer to questions. But after years of research, he's comfortable making a declarative statement about EVs.
"By and large, if you switch to an electric vehicle, there are lower emissions associated with it, even today, and they'll only get cleaner as the grid gets cleaner," Michalek says. And, he says, EVs are more cost-competitive too. "That wasn't true when I started working on this, but now you pay more for the vehicle up front, you save money on fuel, and you can often make up the costs," he says — how long that takes depends on the EV you buy and what incentives are available.
A recent study by researchers at the Massachusetts Institute of Technology shows that across most of the U.S., electric vehicles are cost-competitive with their gas counterparts. And it found that in most locations, EVs also reduce emissions between 40% and 60%.
Our research leaves Higuera believing that it did make sense to ditch his gas Jeep for an EV – both financially and for reducing climate pollution. "Even though I'm just one person, I'm able to do something about it, which is as simple as just switching my vehicle," Higuera says.
NPR Business Desk Correspondent Camila Domonoske contributed reporting to this story.
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