Passing pump for electrified savings

Opinion

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This article was published 04/05/2024 (525 days ago), so information in it may no longer be current.

Plug in, and save money. That’s increasingly a reality about electric vehicles.

What was once more of a luxury automobile still generally comes with a higher price tag than its internal combustion engine counterpart. But increasingly, EVs (electric vehicles) make financial sense given the significant tax credits, along with presumed lower maintenance costs and, of course, significantly lower fuel inputs.

That’s good news even if recent news reports point to flagging sales growth, which led Tesla — now the world’s second largest EV maker, recently supplanted by China’s BYD — to layoff workers to help cut costs to remain competitive.

The bumps on the road to electrification are to be expected, but EVs are within reach financially for more consumers than ever before, says Richard Hall, head EV products at JD Power.

“We’re through the stage of the early adopters — those who did it for the planet,” he says. “For mainstream consumers, the focus now is ‘show me the money.’”

Provincial and federal governments are doing just that.

Manitoba’s new EV Incentive Program offers as much as $4,000 off the price tag of a new vehicle (and $2,500 off a used EV) in addition to the federal iZEV program (Incentives for Zero-Emissions Vehicle), which can slash up to $5,000 off the cost.

Even before the Manitoba incentive, announced this spring, Hall says EVs were often less costly. “Vastly generalizing, EVs are now cheaper than their gas equivalents over a period of years, but there are nuances to that.”

Charging remains a concern, and most buyers will want to get a level two charger installed at their home, which can recharge the battery in about eight hours as opposed to about 20 with a normal 120 volt plug — a level 1 charger, essentially a special adapter that comes with most EVs.

The cost for installing a level 2 charger can be a few thousand dollars, though it is eligible for Manitoba Hydro’s Home Efficiency Loan program. As well, more level 3 fast-chargers are available in the city and along highways, though new EV drivers still face the challenge of radically rethinking how they fuel up, Hall notes.

JD Power has a Canadian website ev.plugndrive.ca for consumers to help compare the all-in costs long-term of EV and plug-in hybrid vehicles — also eligible for incentives — with their gasoline counterparts.

And most EVs are at least on par with their gasoline benchmarks. Many do offer significant savings — like the Hyundai IONIQ 6 Preferred Long Range AWD, which costs about $53,000 after the federal incentive.

It has a monthly electricity cost of about $25 (home charging) versus $235 for a similar gasoline automobile, the Kia Stinger AWD.

Over five years, the total cost — including fuel, maintenance and insurance — of the iONIQ is about $64,000 versus about $77,000 for the Kia. And that calculation does not yet include Manitoba’s credit.

Of course, some Manitobans haven’t waited for the provincial credit. That includes Connie Blixhavn, a farmer in western Manitoba, and member of the Manitoba Electric Association, made up of EV owners.

She says the family farm purchased the Ford F150 Lightning — the world’s first mass produced EV pickup — last year for more than $100,000, though some models today cost about $61,000.

Even at the higher price, Blixhavn says the truck will likely save the farm money over time, estimating the fuel input per 100,000 kilometres is about $7,000 less than internal combustion engine trucks.

“There is a lot of scare-mongering,” says Blixhavn, who also owns another EV, a Ford Mach-E.

She points to recent stories, including one about a family from Winnipeg being stranded on their first road trip in their Lightning to the U.S., that get a lot of media attention.

Range is indeed an issue in rural areas, she notes.

“But those stories catch everybody’s attention, and then everyone thinks that is the whole truth about EVs,” she says. “I had range anxiety when I bought (the Mach-E), but that dissipates over time.”

She adds she can drive the Mach-3 200 kilometres to Brandon and back to the farm on one charge in the winter with range to spare.

Most consumers drive their vehicles mostly for commuting to work and other short distances, roles well-suited for EVs, says Meena Bibra, senior policy adviser for clean transportation at Clean Energy Canada, a Simon Fraser University think tank.

“Range concerns are really more about long distance trips that happen once or twice a year for most Canadians,” says Bibra, who owns an EV to commute to work in Toronto. “I haven’t gone to a gas station in two years.”

The holy grail, she adds, is more low-cost EV choices.

“Otherwise, for low and middle income Canadians, the upfront costs can stop them from accessing EVs’ long-term savings.”

That’s one reason why governments offer incentives, she says.

Coming regulations — including a 2026 mandate that 20 per cent of vehicles for sale must be electric or plug-in hybrid, and the 2035 federal rule that all automobiles must be EV or hybrid — should drive down prices further due to economies of scale, Bibra adds.

Already prices are falling; new EV prices fell about 17 per cent in 2023 over 2022, and 11 per cent for used EVs, she says.

Getting past the higher price tag — which may no longer be problematic with potentially $9,000 in incentives — the ongoing costs, particularly for fuel, are typically lower with EVs, Bibra says.

Blixhavn says their EVs charge mostly on the farm, and when they do use a fast-charger in Winnipeg, for example, the cost is about $15.

“EVs aren’t perfect,” she says, adding the tires on the Lightning were replaced after about 35,000 kilometres due to its heavier weight from the battery and that it is mostly driven on gravel roads.

But the pros — like no longer using fossil fuels — outweigh the cons, she adds. “I would never go back to gas.”

Joel Schlesinger is a Winnipeg-based freelance journalist

joelschles@gmail.com