Are electric vehicles worth the cost? It’s a question many Canadian drivers have been considering since the federal government introduced its emissions reduction plan in March 2022, mandating that only EVs will be sold as of 2035.
To tackle the affordability question, a group of researchers from the University of British Columbia (UBC) examined the cost of an EV over seven years (the average lifespan for a Canadian car), calculating factors such as gas prices, electricity prices, purchase rebates, tax rates, and temperature. The researchers’ main conclusion: It depends on where you live.
“What we found out is that depending on where you live and how you live, the cost of owning an electric vehicle can vary quite a bit across the country,” says Bassam Javed, a PhD candidate at UBC and the study’s lead author.
Quebec ended up being the least expensive province to own an EV while Nunavut was the most expensive. Ontario slotted into the middle, skewing slightly towards the more expensive side. One thing that separated Quebec from Ontario was the fact that the Quebec government offers up to a $7,000 rebate on all EVs while the Ontario government offers no rebate. Plus, electricity in Ontario is nearly twice as expensive as it is in Quebec.
Researchers then pitted EVs against gas-powered vehicles to see which were more affordable in Canada. The study found that EVs tend to have a higher sticker price than gas-powered vehicles. The Hyundai Kona, for example, has around a $21,000 discrepancy between its EV ($43,899) and its gas-powered ($22,099) versions.
But this doesn’t mean drivers should be deterred by the sticker shock. For people who drive a lot, Javed says the EV is actually the more affordable option. Due to low maintenance costs on EVs and the fact that electricity is generally a lot cheaper than gas, the more you use an EV, the cheaper it becomes compared to a gas-powered alternative.
In fact, researchers found that there was an average number of daily kilometres drivers in each province and territory needed to hit to make their EV more affordable than a gas-powered vehicle. This was based on maintenance costs and electricity versus gas prices. Nova Scotia had the highest average daily number of kilometres at 46 and Nunavut was the lowest at 17. In Ontario, drivers needed to travel 43 kilometres per day to make their EV more affordable than a gas-powered vehicle.
“If you’re somebody who’s driving close to 100 kilometres a day, maybe you’re living out in the suburbs or you’re living in a rural area and you’re driving quite a bit, all those households can definitely reap the benefits of an EV quite a bit sooner than other households that don’t drive as much,” Javed says.
As of 2020, 3.7 per cent of vehicles sold in Canada were electric. But as the country continues to adopt EVs, Javed says governments need to think about future policies. Surprisingly, one of the most important issues surrounding EVs is investment in public transportation.
“When we’re looking at consumers who don’t necessarily have $45,000 to spend on a Hyundai Kona Electric, when they’ve got maybe closer to $25,000, or even less than that, folks that are in the middle- or lower-income bracket, there really is no affordable mass market EV that is available in Canada at the moment,” Javed says.
In 2035, when Canada transitions to electric, there needs to be modes of transportation available to those who can’t afford the upfront cost of an EV. That’s why Javed is advising governments to invest in public transportation alongside EV infrastructure.
“Our study actually puts numbers on how affordable EVs are for Canadians,” he says. “We recognize now from the study that there’s a broad set of Canadians that are at risk of being left out of that transition to EVs.”
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