How gas prices might drive more people to switch to an EV |
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How gas prices might drive more people to switch to an EV
And the magic number when owning an EV starts to pay off.
This story was originally published by Grist and is reproduced here as part of the Climate Desk collaboration.
Gasoline prices continue ticking higher as the United States and Israel’s war with Iran continues. As of March 23, the national average stands at $3.96 per gallon, nearly a dollar higher than at the start of the conflict. It’s also just shy of a tipping point that could push consumers toward electric vehicles.
When gas prices top $4 per gallon, BloombergNEF estimates that the total cost of ownership for EVs becomes lower than for gas-powered vehicles. The exact crossover point depends on local prices for both gasoline and electricity. “[But] even when I run the model using the more expensive electricity cost, we are still seeing this very similar pattern,” said Huiling Zhou, an electric vehicle analyst at BloombergNEF. In California, for example, where electricity costs are high, gas is also expensive. At more than $5 a gallon, the state has already passed the point at which EVs are the cheaper option.
According to a AAA survey from 2022 — when Russia’s invasion of Ukraine drove a monthslong price spike — $4 a gallon is also the threshold at which a majority of Americans will make changes to their driving habits or lifestyles. Stephanie Valdez Streaty, director of industry insights at Cox Automotive, agrees that “the high gas prices definitely start the conversation with a consumer.”
“There is no meaningful policy tool to mitigate this.”
Edmunds.com has reported an uptick in search traffic for EVs since the war........