Calculating energy costs per mile for EVs and comparing them to fuel costs for and ICE vehicle is an important metric as you migrate your mixed fleet toward EVs and chart expenses for both. We’ve all heard that fleeting EVs will lower your “fuel” bill considerably compared to an internal combustion engine (ICE) vehicle. But by how much, exactly?

We’ll give you the formula and some hypotheticals; it’ll then be up to you to input your data based on your real-world scenarios.

To make as much of an apples-to-apples comparison as possible, we’ll compare the all-electric Ford E-Transit to the Transit T-150 Van with an ICE engine.

Defining EV Range

The E-Transit has a 68kWh battery and a published top range of 126 miles for the low-roof E-Transit cargo version. The van’s battery size and range are our first two inputs.

Range is, of course, negatively affected by real-world factors such as payload, towing, ambient temperature and weather, cabin heat or A/C use, road conditions, and elevation gain and loss during a trip. (We’ll leave towing out of this analysis.) 

So, calculating some loss in range for real-world conditions is warranted. But by how much?

Ambient temperature has shown to have an outsized effect on range compared to the other factors. According to EV models tested by Geotab some EV models performed better than their EPA-rated ranges in mild weather, peaking at 115% at 70 degrees Fahrenheit.

However, the loss of range is dramatic approaching the extremes. For example, at 5 degrees, EVs dropped to 54% of their rated range in the Geotab study. At 115 degrees, they experienced a 30% drop. In addition to battery thermal management issues at those extremes, using air conditioning or a vehicle’s heater will contribute to range loss — with the heater causing substantially more range loss.

We’ll avoid those extremes. Instead, we’ll factor in a combination of range inhibitors that will take another 20% off range, leaving us at 101 miles of total usable range.

(Side note: Maximum ranges are achieved by charging to 100%, but for battery health the recommendation is to charge to 80% and never fully deplete the battery. This will deplete your usable range even further, but the price calculation is the same.)

EV Range Formula

Now for the formula. Before we plug in our calculations, there is one more variable to determine: charge per kilowatt hour. That price varies greatly, depending on home, depot, or retail charging, utility rate structure, and even time of day.

We’ll use two ballpark prices, assuming first that we’re charging at a depot at $.15/per kWh, and next at a retail location at $.20/per kWh. With that, the calculation is twofold:

• Battery kWh Size / Your Cost Per kWh to charge = Cost per Range

• Your Cost per Range / The Vehicle’s Stated Driving Range = EV Cost per Mile

Calculating E-Transit Cargo Van’s Stated Range at $.15 Per kWh

• 68kWh battery x $0.15 charge per kWh = $10.20

• $10.20 / 126 Miles = $0.08 per mile

Now let’s plug in the more expensive retail price of electricity:

Calculating E-Transit Cargo Van’s Stated Range at $0.20 Per kWh

• 68kWh battery x $0.20 charge per kWh = $13.60

• $13.60 / 126 Miles = $0.11 per mile

ICE Range Formula

Now let's compare those prices to the Transit T-150 with an internal combustion engine. Of course, real-world fuel economy differs from EPA-rated ranges or manufacturers’ targets. At 8,600 lbs. GVWR, the Transit cargo van falls outside of EPA’s fuel economy jurisdiction.

However, there are resources to ascertain fuel economy for commercial vehicles. While far from scientific, this site has directional data to benchmark. From user data on the Ford Transit across recent model years, we came up with an average of 14.6 miles per gallon. We pulled real-world MPGs from this site that tracks fuel economy from real-world use cases. We will use that MPG with the AAA national average of $3.66 per gallon of fuel as of Nov. 21 — again, a moving target, especially these days.

• Gallons Used x Your Fleet’s Cost Per Gallon = Cost per Range

• Cost Per Range / Range = ICE Cost per Mile

Inputting the ICE data from Ford AWD Transit T-150 Van:

• 126 / 14.6 = 8.63 gallons used x $3.66 per gallon = $31.59

• $31.59 / 126 = $0.25 per mile

These calculations suggest a range of $0.14 to $0.17 in energy cost savings per mile depending on the kWh charge rate applied.

Calculating the cost per mile for a fleet van that drives 15,000 miles per year, the total cost for the E-Transit would be $1,200 or $1,650, while gas-powered Transit T-150 would cost $3,750. Driving the E-Transit would result in savings of $2,550 or $2,100.

Many Other Costs

If you are looking to determine total ownership costs (TCO), there are many other costs to consider such as maintenance, initial costs, depreciation, opportunity cost, and insurance, as well as costs to install and maintain chargers, if you choose to include those in TCO.

Regarding energy and fuel costs specifically, remember these are average inputs, not actual. If you’re looking to acquire an E-Transit and are looking to determine operating costs, you’ll need to estimate your range — which isn’t easy when you haven’t yet driven the van. Ask your manufacturer’s rep or local dealer for advice. Or there are many third-party consultancies and even utilities with cost calculators to help calculate range and TCO in general.

About the Author: John Ellis, The EV Guy, can be reached at john@beveverything.com.