The Western Standard recently published an insightful article that dissects the true costs associated with electric vehicles (EVs), challenging the prevailing notion of their economic efficiency. Drawing from a detailed analysis by the Texas Public Policy Foundation, the article reveals that the actual cost of EVs, when accounting for various subsidies and incentives, equates to USD$17.33 per gallon, or CAD$6.32 per litre, over the vehicle’s lifetime.
“Despite a common perception that electric vehicles are cheaper to own and operate than their internal combustion counterparts, a Texas think tank says the true cost is the equivalent of USD$17.33 per gallon — or CAD$6.32 per litre — over the life of the car, after factoring in subsidies and incentives.”
The study considers full cycle costs, including those related to charging equipment and both direct and indirect subsidies such as avoided fuel taxes. It presents a comprehensive view, revealing that the economic viability of EVs is significantly bolstered by a multitude of financial benefits and subsidies.
“Setting aside some of the questionable assumptions used in deriving such favorable economics for EVs, no one has attempted to calculate the full financial benefit of the wide array of direct subsidies, regulatory credits, and subsidized infrastructure that contribute to the economic viability of EVs,”
the authors noted.
The article also highlights the substantial losses incurred by manufacturers despite receiving significant subsidies. For instance, it is reported that companies like Ford are incurring losses exceeding $70,000 on each EV sold.
“Despite lavish subsidies on both sides of the border — to manufacturers as well as consumers — the report suggests companies such as Ford are losing more than $70,000 on each EV it currently sells.”
Moreover, the article brings attention to various indirect costs that are often overlooked. These include the necessary upgrades and maintenance of the electrical grid to accommodate an increased number of EVs and the additional road maintenance costs due to the heavier weight of EVs.
“EV owners don’t pay the true cost of upgrading and maintaining the electrical grid to accommodate the increased load from higher numbers of EVs on the road, which amounts to a handout from regular electricity consumers.”
In conclusion, the Western Standard’s article provides a detailed examination of the economic aspects of EV ownership, uncovering hidden costs and subsidies that challenge the perceived cost-effectiveness of EVs. It encourages a more nuanced discussion on the economic implications of EVs, considering a broader range of factors beyond the initial purchase price.