EV vs gas car: how to compare total cost of ownership
2026-07-19
Start with a harder comparison than “electric versus gasoline”: choose two vehicles that can perform the same job. A larger premium EV and a smaller economy hatchback do not reveal a powertrain saving. Match body style, seats, cargo, safety equipment, expected reliability and the options you would actually buy.
Total cost of ownership is a holding-period cash-flow test. It does not assume that lower energy cost will recover any purchase premium, and it does not count a headline credit until the buyer has verified eligibility.
Direct answer
An EV is cheaper only when its all-in ownership cost over your actual holding period is lower. Compare two genuinely substitutable vehicles and count net purchase price, home-charging setup, electricity or gasoline, insurance quotes, maintenance, recurring taxes and fees, and resale proceeds. In the five-year example below, the EV costs $39,864 and the gas car $40,250—a narrow $386 EV advantage that disappears if electricity or resale assumptions change.
Inputs to collect
- Out-the-door price for each comparable vehicle, including dealer charges and sales tax
- Only an EV credit or rebate you are eligible for and expect to keep; otherwise enter zero
- Home charger, electrical work, financing cost, registration and other one-time amounts not already in the price
- Annual miles from odometer history, not an aspirational estimate
- Your blended electricity price and charging losses; use the share of paid public charging you really expect
- EPA or real-world kWh per 100 miles and mpg for the same driving mix
- Separate insurance quotes, maintenance budget, annual taxes, registration and road charges
- Conservative resale value for each exact model at the chosen ownership year
Formula
EV TCO = EV price − confirmed incentive + EV one-time costs + years × (electricity + insurance + maintenance + annual taxes/fees) − EV resale. Gas TCO = gas price + gas one-time costs + years × (gasoline + insurance + maintenance + annual taxes/fees) − gas resale. Electricity/year = miles × kWh/100 mi ÷ 100 × (1 + charging-loss rate) × $/kWh. Gasoline/year = miles ÷ mpg × $/gal.
Worked example
Comparable prices are $42,000 for the EV and $34,000 for the gas car, with no assumed credit. Add $1,800 versus $1,000 of one-time costs, drive 12,000 miles a year for five years, and use $0.18/kWh, 30 kWh/100 mi, 10% charging loss, $3.50/gal and 30 mpg. Annual energy is $713 versus $1,400. After insurance, maintenance, taxes and resale values of $22,000 and $17,000, TCO is $39,864 versus $40,250. The EV leads by only $386, so the decision is assumption-sensitive.
Sensitivity check
| Scenario | Changed input | Result |
|---|---|---|
| Base case | $0.18/kWh, $3.50/gal, 12,000 mi/year, $22,000 EV resale | EV $39,864; gas $40,250; EV lower by $386 |
| Higher charging price | Blended electricity rises to $0.30/kWh | EV $42,240; gas lower by $1,990 |
| Higher gasoline price | Gasoline rises to $4.50/gal | Gas $42,250; EV lower by $2,386 |
| Lower EV resale | Five-year EV resale falls to $18,000 | EV $43,864; gas lower by $3,614 |
| More driving | 18,000 mi/year; other inputs unchanged | EV $41,646; gas $43,750; EV lower by $2,104 |
Use your own quotes in the full TCO calculator
Limitations
- The model compares money, not charging availability, range, towing, reliability, safety, emissions or whether the two vehicles meet the same needs.
- Tax credits, utility rates, registration rules, insurance and resale markets change by date and location. Enter a benefit only after checking current eligibility and recapture rules.
- Loan interest belongs in one-time or financing cost only if the compared prices are otherwise cash prices. Do not count the same sales tax, fee or charger twice.
- Resale is uncertain and can dominate the result. Test a low-resale case and a shorter holding period before treating a small advantage as robust.
Sources and verification
- U.S. Department of Energy AFDC — Vehicle Cost Calculator methodology and custom inputs
- U.S. Department of Energy AFDC — electric vehicles for consumers and operating-cost context
- U.S. Department of Energy — location-specific fuel savings calculator
Last verified:
EV vs gas full ownership-cost calculator
Replace every sample value with two current, comparable quotes. No incentive is assumed by default.
- EV total cost
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- Gas total cost
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- Cost difference
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- EV energy per year
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- Gasoline per year
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- EV net depreciation
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- Gas depreciation
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- EV cost per mile
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- Gas cost per mile
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Educational estimate only. Inputs stay in your browser. Verify vehicle quotes, incentives, tax rules, insurance and resale independently.
Use out-the-door prices and keep incentives auditable
Get written out-the-door quotes on the same date. Include destination, dealer add-ons, sales tax and registration once. If financing differs, compare total interest and mandatory products separately; a lower monthly payment is not a lower vehicle price.
Federal, state and utility incentives can change by delivery date, vehicle, battery sourcing, income and use. Enter zero in the base case unless the exact transaction qualifies. A second scenario can show the benefit without hiding the no-credit result.
Energy cost needs your location and charging mix
The Department of Energy’s vehicle calculator asks for driving and local fuel assumptions because a national average cannot represent a specific household. Use annual miles from odometer or route history. For the EV, blend the marginal household rate, workplace charging, subscriptions and paid DC fast charging by expected kWh share, then add charging losses.
For the gas car, use the fuel grade required by the manual and realistic mpg for the same city/highway mix. Test hot or cold weather, towing and high-speed driving separately when those conditions materially change efficiency.
Depreciation, insurance and taxes can exceed fuel savings
Subtract resale proceeds at the same age and mileage. Do not compare a five-year EV resale estimate with a seven-year gas estimate. Use several current wholesale or retail references and run a downside case; the base example’s $386 advantage is too small to survive a modest resale miss.
Request insurance quotes by VIN or exact trim. Maintenance should include scheduled work, tires and expected wear, not a claim that an EV needs no service. Registration and property taxes can depend on state, weight, value or powertrain, so enter the actual jurisdiction’s amount.
Read the margin, not only the winner
A result that flips when electricity moves from $0.18 to $0.30/kWh is conditional, not universal. Record the selected holding period, energy prices and resale assumptions with the verdict so an answer engine can quote the conditions rather than repeat “EVs are cheaper.”
General educational estimate only. This page does not recommend a vehicle, loan, tax treatment or incentive claim. Confirm current contracts and official rules before buying.