Who Saves Money Buying Electric Vehicles? Heterogeneity In Total Cost Of Ownership

Electric vehicles (EVs) are likely to be a critical technology for mitigating climate change and improving urban air quality. To deliver environmental benefits, however, EVs must be adopted on a large scale. Total Cost of Ownership studies have shown that for the average US consumer, EVs cost more than gasoline-fueled vehicles. We contribute to this literature with a focus on heterogeneity across space and driving habits. Specifically, we estimate 5-year ownership costs for four EVs and four gasoline-fueled vehicles by neighborhood across Los Angeles County. Due to variation in electricity rates, insurance rates, and vehicle miles traveled, the median cost varies across neighborhoods by a factor of between 1.2 and 1.35, depending on the vehicle. Median costs of ownership are usually higher for EVs than for comparable gasoline-fueled cars, but considering the full distribution of vehicle miles traveled suggests that buying an EV saves money for over 17% of households.