- April 24, 2024
- Posted by: legaleseblogger
- Category: Related News
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## Evaluating the Impact of Having Solar Installed on EV Economics
I have been an observer of personal finance discussions in Canada for some time now, and I am aware that the prevailing advice is often centered around the idea of purchasing a reliable vehicle and utilizing it for as long as possible. However, I am interested in hearing the group’s perspective on my current situation.
Recently, I had solar panels installed on my roof, and as a result, I am generating more power than I need for my household requirements. This surplus power could potentially be used to charge an electric vehicle (EV) at no extra cost. In fact, there might even be an opportunity cost associated with not utilizing this excess power efficiently. While I could choose to redirect this surplus power to other purposes, such as an electric hot water heater, I am considering the possibility of using it to fuel an EV.
Currently, I own a 2018 Subaru in excellent condition, valued at around $14,000 according to listings on autotrader. Despite its worth, my wife and I primarily rely on public transit for our daily commute and reside in a downtown area, resulting in minimal use of the vehicle. As a result, our monthly gas expenses are approximately $150. Given that the majority of our trips involve short city drives, we believe that a Nissan Leaf or a similar city commuter EV would suit our needs adequately. For longer journeys, we are open to the option of renting a vehicle for the weekend.
Considering these factors, I am contemplating the idea of selling or trading in my Subaru for a gently used EV priced below $25,000. There are numerous options available in the market, such as a 2022 Nissan Leaf with less than 40,000 kilometers, which is listed at approximately $24,000 in Ottawa.
I would appreciate hearing the opinions and insights of others on this matter.
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>My car is a 2018 Subaru in great shape, worth about 14k avg on autotrader. But my wife and I take transit to work and live downtown so we barely drive it ( ~$150 /mth on gas). So that lowers the payback on investing in an EV. 99.9% of our diving is short city drives, so we’re pretty comfortable with a city commuter car like a Nissan Leaf, and renting something for a weekend if we’re going farther.
For EVs, the more you drive it, the larger the savings as electricity is cheap vs. gas and you’ll also save on the maintenance (less wear on the brakes due to regen braking and there’s no oil change in an EV for instance).
Personally if your 2018 Subaru is in great shape, I’d recommend just keep it since you barely drive it. Hell, some people might even argue why you need a car at all and rent one during the off time that you need one.
I would avoid used Leafs (Leaves?) as they have [well documented battery problems.](https://www.cbc.ca/amp/1.7148537)
I otherwise agree with the other poster, if you are not driving much, the offset against fuel costs is probably not going to be worth the cost of buying a new (used) vehicle.
The ultra low overnight rates in Ontario are so low, that having excess solar power isn’t going to really move the needle too much for your purchase.
I bought an EV (Ioniq 5) about six months ago. By adopting the low overnight rate, I calculate that over the course of the year, I’ll probably spend about $150 in electricity to drive about 18000 km with the 2.8¢ a kwh.
Not sure what the economics of an EV decision is for you, but it’s unlikely the $150 is a tipping point. Especially since you’re probably getting something from the utility provider for your energy, so it would be reduced.
All that said, I’ve found the economic benefit of my EV higher than anticipated for myself. I was due for a new car, and i brought something that best fits my needs. The premium I paid will likely be paid off in about 4-5 years if variables stay the same. And most importantly, I enjoy the car. I’d do the decision again. But everyone’s situation is a bit different.
Cars have fixed costs and variable costs.
Fixed costs are the costs you incur by owning it, variable costs increase when you drive it.
EVs can only save you money on the variable cost of ownership. Your variable cost is very low, so keep your gas car until you would otherwise replace it (either due to age, increasing repair costs, desire for a new car etc) and then buy an EV.
My parents are in a unique situation where they also produce far more electricity than they can legally sell, so they have an EV and a PHEV. They both drive a lot though, something like 20,000 km/year each, so the math works really well for them.
Myself, I would love an EV for personal reasons, but my old, inefficient luxury car costs zero in depreciation, very little in repairs (I can fix it myself) and very little in insurance and since I barely drive 5,000 km/hr, it’s cheap transportation even at 10mpg.
I was paying $450-$500 a month on gas. Now I have an EV, monthly payments and insurance is the same cost, but I spend about $40 on charging a month at home now. So I’ve saved a lot. Plus I can take the toll bridge for free with an EV so I’ve saved even more on my commute. Plus I don’t Have to worry about oil changes, brakes will last much longer.
Overall I’m very happy I made the switch.
Honestly, in this situation since you don’t drive that much..keep the outback. Maybe start researching Bitcoin miners. It’s the only thing I can think of that used a lot of electricity and *could* bring in some cash.
Give it another 3-4 years. EV technology is constantly being developed and we’re still in the beginning stages.
>But my wife and I take transit to work and live downtown so we barely drive it ( ~$150 /mth on gas).
>we’re pretty comfortable with a city commuter car like a Nissan Leaf, and renting something for a weekend if we’re going farther.
You are never going to financially come out ahead on an EV with such a tiny amount of driving, even with a solar installation.
With your driving profile, you should one own reliable, versatile vehicle like a large non-electric SUV, which it sounds like you already have (you didn’t say what kind of Subaru it was). Assuming it serves all your needs, the best move financially is to keep it.
The real issue with solar is that it is not efficient to store it. For you to use the solar to its fullest is to charge the EV it during the day and drive it at night.
– we barely drive it ( ~$150 /mth on gas)
– When does it actually make sense to buy an EV?
when car payments + fuel > car payments + electricity.
this was 2019 for me. $0 + $450 > $400 + $0
Or, if you believe in climate change, and think its man made, and want to tell your grandkids that your sorry the planet doesn’t have the nice things it used to, but at least you did what you reasonably could.
but i waited until it made financial sense.
I own an EV as my only car. I don’t really do road trips so it works for me, and the odd time that I do, I’ve come to terms with the inconvenience and longer charging time of my Bolt.
If you rarely drive your car at all, and when you drive it you do road trips, a Leaf is not a good idea. The fast charging is built on an obsolete plug standard (Chademo). Plus, the batteries are not active cooled so doing fast charging a few times in the day is bad for battery health.
Plus, the crazy increase in insurance cost for EVs in the last year is another factor to consider. If you’re only spending $150/m on petrol, but insurance is going to be $100/m more, it starts to make less financial sense.
Anyways, to summarize, I love my EV, it’s smooth and quiet and smells nice, but realistically it was a splurge purchase as a nice to have thing, not exactly a financially friendly decision.
This is PFC so the answer is always going to be “no” to buying a new-to-you car unless you literally have to.
With that out of the way, if you still want to make the less financially optimal decision to buy a car, here are my thoughts.
You’ve got a house with solar so I’m going to assume you have a private driveway and can install a charger.
You will not regret going electric. The user experience with electric charging at home is far superior to gas, you’ll love it.
I would suggest taking a look at used Teslas. They’ve been in volume production long enough that they’re finally showing up in large quantities on the used market.
You can get a used Tesla model 3 for under $30k!
The Hyundai ioniq cars are also great.
The leaf is not so great. The Bolt can be found really cheap and can work for some situations, it’s not great for long distance travel.
Personally I think you’d be insane to buy a leaf for $25k when a Tesla is $30k.
I personally would not buy an EV… The leaf you are talking about is 25k but that would really cost closer to 30k. Your Subaru is worth 14k but if you trade it in you will get 10 at most….
How long will it take you for that 20k return on investment?
Not to mention the leaf is one ugly looking vehicle…
Keep the Subaru.
Not sure what rate plan you are on, but it can depend on also the time of your usage. The thing with EV charging is that you rarely need to charge immediately. You can charge overnight when electricity is cheapest, especially if you are on the ULO plan.
1. Steer clear of Leafs. Jsut avoid then at all costs. Maybe they have gotten/will get better, but let the people take that risk. They’re garbage.
2. It doesn’t make sense.
You’re only saving $150/mo. You can’t buy any decent late model EV off of selling a $14K car + 150/mo. Revisit this when it’s “We’re *already shopping for a car. Does it make sense to spend a few extra bucks to get an EV?” *then* your answer will be yes, even with your minimal driving.
My wife and I faced the same issue a few years back.
We were very close to “yes”… Then she left that job, started working part time and doing full time school remotely.Boop, forget the EV! Then MY commute went from 45min to 19.
Can you do zero export? Hydro One will pay you the same rates back to you that you keep “in credit” for use later in the year like the winter when you will under produce.
Speaking of which – you just got it installed – do you have details on energy production from October to May? Because it is likely to be a fraction fo what you get from June to September.
Another thing to consider – most cars will have a regular plug charger included for free (that goes into your wall plug like anything else). If you wanted a class 2/200amp charger on your solar you will be paying $1000-$2000 installed for it. Even if you just hook it up to your electrical panel you will drop $1000.
To me – You are never going to recoup the costs with driving only $150/month worth of fuel in an ICE.
If you want to save the planet – go for it – I would recommend looking at PHEV for your lower kms of driving as they are cheaper than pure EVs.
I priced in 2024 corolla hybrid vs gas. It would take 8 years to pay off the extra cost of the car in gas.
With that little amount of driving, probably not worth it. Your insurance on an EV will cost more, wiping out a good chunk of your gas savings.
I bought a used 2017 Chevy Bolt and love it! Still has a 6 year warranty on the battery. Spending 500$ or more a month on gas before, now it costs 30$ a month electricity, insurance went up 50$ a month.
Some good comments on here.
I do a minimum of 10,000 km a month – so what works for me is not what works for you
Incidentally I haven’t yet. Fire is also a concern for my freight; increased insurance rates for ev’s as well
To simplify, you bought panels anyway; you pay insurance anyway; leave those out
Take what you pay a month for gasoline and see if it is more or less than a payment on an ev.
If it costs more for the payment; switching is for your ego, not a financial reason
Trust me, I’m getting impatient waiting for solid state batteries. It’s $4.50 ish to use home hydro to fill a battery, of course I’ll immediately switch at 120,000 to 150,000 km a year
If your vehicle is strictly for transportation to you then it sounds like you’ve got a good thing going and stick with it.
Based on your assumptions, your potential proposition is to pay $10K to reduce monthly gas bill from $150 to $0.
Without adding in rental costs for weekend long-range use; assuming you get the same utility out of the EV vs your Subaru; and assuming no change in maintenance (although it may be lower with an EV);
then you’d reach break-even ROI in about 5.5 years…
My *personal* mentality to an EV is: when I need to buy/replace a car, I’ll consider an EV within the same budget of an ICE vehicle I’d be eyeing and trade-off “utility” differences. i.e. for the same amount of money, an ICE may be newer, have more luxury features, or be bigger. I *personally* don’t like replacing a perfectly good car to get an EV just for the sake of it.
Unless you drive a ton or your current car is on its last legs, the upfront cost of the new EV offset by whatever you can get from your current car will usually outweigh any cost savings.
Don’t buy a Nissan Leaf. I’d go Model 3 for a similar price.
> I am over-producing power for my needs
What the heck did you do that for?
I once went to view a house once when I was house hunting. The homeowner was using solar power and not only for them but a few of the neighbours around his house. They were generating income with it. Maybe that’s something you can look into?
If you can charge from home at a good rate the $/km usage cost of an EV is very low. You don’t drive enough to make it worth it all, from a financial standpoint. We were averaging 1000/km a week when we got ours. It was worth it.
I’d stay away from the Leaf as the batteries aren’t actively cooled which unfortunately doesn’t bode well for the battery longevity.
Kona EV is similar and can be had for under 25k but has faster charging, much better battery longevity etc.
I’m saving around 2k per year with an Niro EV vs the HR-V we traded for it (~20,000km/year). No oil changes, carbon rebate is a greater net rebate etc.
My calculations showed that EV charging is on par with an economical gas car. As the excess is not free, because you don’t sell it for 0.3/kW back to the grid, it makes it quite clear expensive. And we’re talking perfect conditions, when you charge only when the system is producing.
Eventually, you will end up sometimes charging during the night or just a cloudy day, and the cost would be higher, as you pull from the grid.
And during winter time, after you switch back from solar club tariffs, there is no excess and just regular 0.2/kW or even more.
Go check out polestar 2, they have a great deal for a 12 month lease at 299$. If you’re new to EVs might be a great trial
How many kms on the Subaru?
I hear horror stories about the CVT transmission failure.
We have a 21 outback but I don’t think we’ll keep it more then 5 years.
If your low kms I’d keep the subie. If your high kms I’d run to the EV.
By 2030 they will be awesome
Damn dude I spend less on gas and I come into work everyday for ~50km daily commute. $150 a month on gas for barely driving is insane.
As much as I love my EV and would not switch back, it doesn’t really pay to switch unless you need to buy a new car, unless you are driving 30000km per year. I replaced my 14 year old car with a Bolt a few years ago. My other car is 9 years old and in 4-7 years when it’s time to replace it, I’ll buy another EV. Until then it’s stand pat.
The sooner you buy, the sooner you start saving.
Looking at your situation, EV would basically pay for itself in 5 years. It will cost you an extra 10k$ to go EV, and you’ll save ~2k$/year in gas and oil changes, but you’ll continue to save 2k$/year after that. If you keep the Subaru, you’ll still pay 10k$ over the next 5 years and continue to pay 2k$/year after that. Over 10 years, it will cost you 10k$ more to keep the Subaru, even more when you factor in maintenance.
But what if you keep the Subaru for 5 years and then change? Both cars will depreciate, but you’ll still need to pay a little more for the EV. Instead of already being at the breakeven point, it will take another 2-3 years for the savings to even out the upgrade price. So it will cost you an extra 4-6k$ to wait 5 years and then upgrade.
Also in terms of savings, brakes last 2-3 times longer and according to the studies I’ve seen, EVs have a lot less repairs in general. Long term repairs and maintenance is generally half of what an ICE costs.
And the resale value of the EV will likely be higher than the Subaru. So you’ll get back some of that 10k$ you’re paying to upgrade to the EV when it comes time to sell.
For me the answer is never. I don’t even own a car. In fact I never own a vehicle. Whenever I move (luckily only twine) I make sure I move within 5 min walking distance of a major public transit hub and there are several grocery stores, malls, restaurants, community center and park all within walking distance.
If I somehow need to use a vehicle I either take uber, lyft or taxi.
There’s the financial aspect, but you also get the convenience of home charging, no noise, instant torque, a frunk and 1-pedal driving (I think Leafs have it), so even if the finances don’t balance out perfectly, you do seem to get more out of the EV. I don’t know much about Leafs in particular though.
I think buying a used Leaf and driving it into the ground is totally sensible. How solar affects the economics depends a lot on your local solar economics. At least in Alberta, it actually makes less sense for me to use an EV, because during high producing summer months, my marginal cost is 0.30/kwh (I could be selling the power for that price) and in the winter the economics are unchanged.
Of course, smarter approach is to get the EV first, and then you’re allowed to install a larger array since the rule is that estimated annual production should be no more than your annual consumption.
The very little amount that you drive, it doesn’t make sense to swap out to an ev yet.
The amount of carbon your car is currently producing is a fraction compared to what producing a new ev will be. While I agree that the environment needs some over due attention, the current forced mandate is not even remotely considering the environmental cost of producing all the new cars and required batteries. Now hearing that so evs are being abandon is concerning, what will happen to all those batteries as they are wrapping out.
Even though you’ve added solar, producing a car has a carbon footprint, that calculation is conveniently not considered.
When did you get solar installed on your roof? In our winter months when the days are shorter and there’s a lot more overcast you will likely produce a LOT less. I wouldn’t jump the gun yet until you get a full annual cycle to see what’s going onZ
I’d get a Bolt EV or EUV before a Leaf for a bit more money, better charging on the road (Chademo is going extinct)
Even with free power, you’re only saving $150/month though, so it would take a bit of time to “break even”. That said, driving an EV is quite awesome. No noise, instant torque, pre-heating in garage, always leave home with a full tank, less maintenance…
2035 and only IF they become mandatory. Until then get a good PHEV and cash in on the Provincial and Federal rebates while they’re hot
I went with a plug in hybrid and it is perfect, I basically pay nothing to drive and if anything goes wrong its way cheaper to fix. Plus it doesn’t have a huge battery pack which will cost a ton to replace. You really do get the best of both worlds, highly recommend
Simple: When you no longer want to buy gasoline.
You’ll still have to buy insurance. You’ll still get stuck in traffic. And if you’re a bad driver, you’ll still end up on someone’s youtube video.
In your case, when your Subaru reaches that point where repairs are greater than the residual value – time to replace it.
I’m in a similar boat. I’m thinking of moving out of the city and would commute about 100 kilometers each way to the city three days per week on average. I’d like a crossover SUV that’s got room for the family and occasionally hauling things. I’ve been weighing hybrids versus plug-in hybrids versus electric for a vehicle (and I’m due for an upgrade from my current vehicle at anytime). Is switching to electric a good idea for me, or would I be better off with a plug-in hybrid or just a plain hybrid?
When you can afford it. It then makes sense.
For me, it was when the price of my existing car payment+fuel+maintenance was less than the car payment for an EV. I’m saving about $4,000/yr by not buying gas