Saving Money Yet?

“How much do we save?” is one of the top questions I hear when people discover our Leaf is fully electric.  Here is a summary of the savings and costs of driving our Leaf.  I have excluded any costs which would be the same on a gas car, e.g. winter tires.
 
 
Up Front Costs

We spent about $10,000 more on the Leaf than we would have on an equivalent gas car. Admittedly, that’s a very subjective estimate but it seemed to work based on the cost of the cars we have bought and were considering buying. We need to save $10,000 just to break even. Living in another province or in the United States would have made that number a lot lower. For example, in Ontario the provincial rebate cheque would have reduced that number to $1,500!
 

Gas Savings

The largest savings comes from the efficiency of using electrical power versus burning gas.  We pay $0.11 per kilowatt-hour (kWh) in New Brunswick and the Leaf gets between 5 – 7 kms per kWh.  The price of gas during year one varied a lot but was often $1.10-$1.30 per litre. The Camry burns 7.5 – 9.5 L per 100 km. The frequent changes in gas prices made calculating what-we-would-have-spent-on-gas tricky so when I was unsure I tried to be conservative so as to not over state savings. In year one we drove 15,000 kms and saved about $1,000. That’s the difference between the cost of the electricity and the cost of the gas that we would have used in the Camry.

If you’re fascinated by tortuous detail then keep reading to learn about some of the calculations behind that total.  If you feel your eyes about to glaze over then jump down to “Other Savings”.

Detailed Calculations for Fuel Savings

First, a little background on electric car mileage calculation.  The electricity rate in New Brunswick is $0.11 per kilowatt-hour (kWh). When the daily highs are around 15-30 C our Leaf’s computer reports mileage of about 7 km per kWh. Also, no matter the temperature, the charging process loses 7-10% of the power it consumes so we need to allow for that in the calculations.

Leaf versus Camry fuelling costs during mild weather:

  • Leaf
    • 7 km/kWh = 14.3 kWh / 100 km
    • Allow for power lost in charging: 14.3 + 10% = 15.7 kWh / 100 kms
    • The cost of travelling 100 km is $0.11 x 15.7 = $1.73
  • Camry
    • 7.5 L per 100 km
    • At $1.00 per litre the cost of travelling 100 km is $7.50.

So, when the weather is mild, the Leaf saves us about $5.77 every 100 km.  Nice!

When the cold temperatures moved in the results changed but not as much as you might think.  In the winter the Camry is much harder on gas while the engine is warming up to its normal operating temperature.  On the plus side, once it’s warmed up, a gas engine has lots of spare heat for keeping us toasty warm inside.

In the Leaf, the electrical engine has no warm up period.  It’s efficient from the start.  On the down side the engine is so efficient it does not produce much surplus heat. To warm up the passengers the Leaf’s battery must power a combination of heat pump, electric heater and/or electric seats (front and back).  In February the Leaf mileage dropped to 4.3 km/kWh or $2.81 per 100 km. The Camry mileage dropped to about 8.5 L/100 km or $8.5 per 100 km.

So even in the coldest time of the year the differences in fueling was still almost the same, about $5.69 / 100 km.

 
Other Savings

Replacing gas with electricity has definitely provided the lion’s share of our savings. There are a few other savings worth mentioning though.

  • Our Camry, like any other car we’ve owned, requires two oil changes a year.  The Leaf engine has no oil to change.  Annual savings:  $50 x 2 = $100.
  • Insurance companies seem to like electric cars since they provide a discount.  Annual savings: 5% discount on the Leaf coverage.
  • NB Power has two parking spaces with chargers reserved for electric cars in the middle of downtown Fredericton.  When we shop downtown we park there to benefit from free charging and free parking.  Hourly savings: $2.50 ($1.75 for parking plus $0.75 for the charge).

The above savings add up to about $150 annually which brings our total savings for the first year to $1,150.  Not great but I expect the annual savings in future years to be more.

 
Future Savings 

For year two and after I expect our annual savings to increase to up to $1,950. That’s for two reasons.

First, we continue to drive the Leaf more and the Camry less.  That’s due, in part, to the continued increase in the number of public chargers.  For example, two new chargers were installed in downtown Saint John in May 2015.  That means we can drive to Saint John (~105 kms) and charge while we’re there instead taking of the Camry.  I expect that by the end of year two we’ll have driven 9,000 kms more than in year one which will increase our annual savings by about $600.  We’re already off to a big start since the Leaf racked up 4,500 kms in the last six weeks of the federal election.

Second, we spent $800 during the last four years on brakes for the Camry.  The Leaf uses regenerative braking which greatly reduces the wear on its disc brake pads.  I expect to still be using the same brake pads, in good condition, at the end of four years.  Annual expected savings is $200.  I won’t start counting those savings until the brakes pads are checked at the end of year two.  That said, our experience to date and the anecdotal evidence from other Leaf drivers supports my expectation.

What is regenerative braking?

Regenerative braking slows the car while charging the battery.  The brake pads are only used during hard braking or the last portion of a complete stop. As a driver you don’t have to know how this work – it just happens automatically.

Regenerative braking is awesome!  My favourite  example is going down the Fredericton “hill” – an 80 meter drop across two kms.  Unless we have to stop we don’t need to touch the brake pedal going down the hill.  When we reach the bottom of the hill the Leaf has more charge that it did at the start!

One last thing in the savings category – car maintenance. The electric car powertrain is very simple: an electric motor with less than a dozen moving parts, a single speed transmission and no exhaust system.  By comparison a typical gas engine has over two hundred moving parts and is connected to a sophisticated multi-speed transmission and an exhaust.  Over time that should result in much lower service costs.  That’s the hope and expectation – I’ll let you know after the three year bumper-to-bumper warranty expires.

 
Future Costs

It’s not all peaches and cream.  There are a couple of potentially large down-the-road costs which I had to consider before buying the Leaf:  battery life and resale value.

First, the battery.  The use of lithium-ion batteries as a power source is arguably the most advanced part of electric cars – replacement cost for just the Leaf battery runs around $5,000 – $6,000.  As battery technology improves the cost will likely drop over time but that’s still a daunting number.  So how long will the battery in the Leaf last?  The lack of a large history of data on batteries for electrical cars makes it hard to be definitive. Nissan is confident enough to cover the Leaf’s battery for eight years.  Most literature I’ve read places the expected life at 10+ years.  These batteries also last longer when they have only a limited exposure to 30+ C weather and aggressive driving. For our Leaf in Fredericton I’m expecting to easily exceed the ten year mark.

Second, resale value.  Electric car technology is rapidly improving.  That means our new Leaf is going to seem pretty dated in a few years, especially when the 300+ km range cars start shipping in 2017.  Not only that but there are purchase incentives being offered in other provinces and in the United States. Those two things will have a dramatic effect on reducing the resale value of our Leaf, especially in the first few years.  This is not a big deal for us since we tend to keep cars until they are ten years old.  By that time, any difference in resale value will likely be based more on how well the car was maintained than it’s original purchase price.

 
So Are We Saving Money?

We love driving the Leaf but it would be hard to justify our purchase solely on the basis of saving money.  Using today’s fuel costs we are not expecting to drive enough for the savings to offset the up front and depreciation costs.  Sure, if gas prices jump again and continue to outpace electricity rates then we could end up coming out ahead.  For now, I expect the people that are likely to come out financially ahead are those who purchase using incentive programs or buy used cars.

If we’re years away from just breaking even then why do we love our Leaf?

 

Next Post – The Leaf driving experience.

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