How long does it take to offset the upfront cost of an EV?

Currently, there are a limited number of EV four wheelers available in the market, most of which are premium models offered by Kia, Morris Garages (MG) Motors, Volvo and Hyundai. 20 lakh and 65 lakhs. Some EV cars are priced moderately, including the mid-priced Tata Nexon 15 lakh and 20 lakh, between Tata Tigor 12.5 lakhs and 13.64, starting with Tata Tiago 8.49 Lakh and Mahindra e-Verito price in . is between 9.13 lakh more 9.46 lakhs.

However, barring the higher upfront cost, electric cars may prove to be more economical than their petrol counterparts in the long run. The operating cost of EVs is only a fraction of that of fossil-fuel based vehicles. In addition, with petrol becoming more expensive from year to year, it makes more sense to switch to the earlier one economically.

To evaluate how long it takes to offset the cost of an electric car, Mint compared the cost of owning the Tata Nexon and the Nexon EV Prime (see graph). Both the cars are manufactured by the same company and are similar in terms of product specifications.

Our calculations showed that at an average annual movement of 17,000 km (46 km/day), if you buy an EV it will take you about six years to cover the cost.

Compared to petrol cars, driving an electric car will save 85-90% on fuel costs and this savings adds additional time to offset the higher upfront purchase price of an EV. To put this savings in perspective, our example shows that a Tata Nexon owner will have to pay a heavy price. 6.92 lakh in petrol over six years (at the current price of petrol), while Tata Nexon EV owners will spend marginally 68,000 (at what) in the same time period. EV owner saves approx. 6.24 lakh in fuel expenditure alone.

In addition, EVs have lower servicing and maintenance costs as they have fewer moving parts than petrol cars, and its main component, the battery, is maintenance-free. We haven’t included battery replacement cost in our calculations as most EV car manufacturers offer 6-8 year warranties and industry claims car batteries last 10-12 years and need to be replaced before that. does not happen. Currently, the cost of battery replacement is 15,000-20,000 per Kwh (a mid-range car battery is 30-40 Kwh).

By the end of the sixth year, you will have a net savings of approx. 30,000 in owning an EV (view graphic).

EVs enjoy zero road tax: This was waived off by the Ministry of Road Transport and Highways last year to boost EV adoption in the country. State subsidies on EV cars are now largely over as they were earlier made available to a few buyers.

It is to be noted that since the running cost of an EV is majorly responsible for canceling its high purchase, net savings are possible only if the car is driven regularly. For example, in the same example of Tata Nexon and Nexon EV Prime, if the average annual commute is 10,000 km (about 27 km per day), how much would be the cost of ownership of an EV car? 2.19 lakh against petrol in six years. It may take about 10 years to recoup the purchase cost (see graphic), but that’s around the time the battery may also need to be replaced (cost approx. 6 lakh) or the car is put up for sale.

We have not considered the resale value to determine the total ownership cost as there is not enough data on resale of EV cars. However, purely based on the current high demand for ICE (Internal Combustion Engine) vehicles, their resale value will be higher than that of EVs, said Animesh Das, ACKO’s senior director, motor underwriting.

high insurance

Apart from the higher purchase price, insurance on EVs is also comparatively costlier by about 40%. “The landing cost of insurance for the customer is higher in the case of an EV, as the value of the car is higher,” Das said.

He said that at present the depreciation applicable to EV cars is the same as that of petrol/diesel cars, although the value of the battery depreciates faster than the value of the engine. “In five years, the market value of batteries has decreased by about 70%, but engine depreciation is in the 50% range. Thus, a vehicle with a petrol or diesel engine will cost more than a vehicle powered by a battery.”

The premium for EV insurance increases only because of the higher IDV (declared value of the insured) of the vehicle, not because it offers any additional benefits.

EV insurance, like any motor policy, covers against accidental damage to the vehicle, fire, natural calamities, riots and theft of the insured vehicle. Indranil Chatterjee, Co-Founder, RenewBuy, said, “Any damage to EV batteries against accident and ‘Act of God’ perils is covered under insurance policies, while electrical and mechanical failure are not covered. ”

charge and range

The 15 amp socket used for air conditioners and geysers in homes can easily charge EVs. Most of the car companies install 15 amp charging point at the owner’s house for free. But, the charging time is longer in this case. It takes around 9-10 hours to charge 10-90%. A car with a range of 210-20 km (the distance covered on a fully charged EV) and an average of 45 km a day will need to be charged twice a week using the 15 amp socket.

Alternatively, one can use the CCS (Combined Charging System) connector for faster charging at a fast-charging station (60 minutes for 10-80% charge). You can download EV plug, charge-list and . You can locate charging stations in your city on platforms like Tata Motors website, among others.

Those who live in apartments inside the housing society and do not have private parking space, have to depend on common charging points set up in the society. Sameer Ranjan Jaiswal, CEO of Charger, said the Resident Welfare Association (RWA) usually sets up the facility and recovers this cost from EV owners by charging a premium on their electricity bills. For societies that do not have an RWA, EV owners can collectively get charging systems installed from companies that provide the necessary infrastructure and billing systems, such as ACDC Electric, Zeon, ElectricPe, etc. In this option the billing system is based on one payment. -As-you-use method.

The people living in the housing society can install the charger in the common parking lot by pulling the power line of the society, installing submeter and charger. For this permission will have to be obtained from the society association and the concerned discom.

Whichever method you choose, it is advised that you discuss the charging infrastructure installation with the Society Association/RWA before buying an EV as there have been cases where housing societies have rejected it.

Separately, the viability of EV cars for inter-city travel becomes debatable as smaller cities and highways do not have proper charging infrastructure. If you are planning for inter-city travel, it is advised that you plan the charging schedule well in advance. Make sure there are functional charging stations on your route and that the hotel or any lodging has a 15 amp socket installed in the parking area.