The True Cost of EVs Is More Than The Sticker Price thumbnail

The True Cost of EVs Is More Than The Sticker Price

The goals of President Joe Biden’s administration are lofty: among them, nationwide vehicle electrification within 20 years. To reach that goal, the administration has recently proposed new fuel economy regulations that will help ensure that 67% of new passenger cars sold are electric vehicles by 2032.

The problem is that this green dream is physically impossible to achieve in the next 10 years, and our new research at the Texas Public Policy Foundation shows how much Americans are already paying to try to achieve it.

EV advocates often claim that with the right balance of expensive subsidies and coercive regulations, we can quickly summon new battery and EV technology on a massive scale and make EVs cheaper than gas-powered cars.

What they don’t admit is that these subsidies and regulatory favors, not counting the new subsidies in the Inflation Reduction Act that are beginning to take effect this year, are already costing Americans at least $22 billion annually, which is almost $50,000 per EV that is sold.

Much has been written about the $7,500 federal tax credit for EVs and tax breaks for domestic battery manufacturing, but our research shows that regulatory credits are the biggest subsidy for EVs, with an average of $27,881 per vehicle. This is primarily because EVs are being given a 6.67 multiplier to their rated fuel economy under federal standards so that an EV with a rated fuel economy of 100 miles per gallon is credited as if it is getting 667 miles per gallon.

Another concern is the strain EVs will place on the grid if nothing is done to optimize their charging patterns. As it is, infrastructure to support EV charging — including things like replacement and upgrade of transformers, circuits, feeders, and transmission lines, as well as extra overhead costs like metering and billing required to service charging stations — will result in an average of $11,833 in costs per vehicle over 10 years, our research found. Those costs are being socialized to your electric bill and to your tax bill.

A regular EV charging at home consumes as much power as several homes, and fast-charging an EV in under an hour may consume as much as 100 homes or an average grocery store. A Tesla here and there are manageable, but if more than 100 million EVs are connecting to the grid-like the Biden administration is envisioning — not to mention its push to electrify heating and industrial processes — then the impact on our grid is hard to fathom.

Ironically, ditching gasoline wouldn’t meaningfully impact the environment. Personal vehicles account for only 20% of all U.S. carbon dioxide emissions, and phasing out all U.S. emissions by 2050 will only reduce temperatures in 2100 by the barely measurable amount of 0.08 degrees Celsius, our research found.

The U.S. is already a world leader in clean air, and levels of actual pollutants such as soot and smog are already so low in the U.S. that taking half the cars off the roads during the 2020 COVID-19 lockdowns did not measurably change pollution levels, according to our research. Forcing every American into an EV to try to achieve such a small impact is not worth it.

Also, EVs have social and environmental impacts that must be considered. EV batteries require significant mining of cobalt, lithium, and copper, which is primarily done in foreign countries with lax labor and environmental standards. The result isn’t environmental justice; it’s children as young as four mining cobalt in dangerous, squalid conditions in the Congo, as reported by CBS News.

As battery prices fall over time, hybrids are the natural next step. They use batteries that are 50-100 times smaller than EV batteries to achieve significant fuel economy gains, and they do not require new infrastructure to fuel up. Despite receiving far fewer government favors, hybrids are still outselling EVs in the U.S. according to the U.S. Energy Information Administration, and hybrid sales are growing at a similar pace to EVs.

Instead of spending hundreds of billions of dollars to force automakers and consumers to adopt a politically favored technology at unsustainable rates, our leaders should let markets drive technology adoption, efficiency, and all the benefits that come with that.

*****

This article was published by the Texas Public Policy Foundation and is reproduced with permission.

TAKE ACTION

As we move through 2023 and into the next election cycle, The Prickly Pear will resume Take Action recommendations and information.