Photo: Michael Graham Richard
Dear Pablo: Getting a Prius never made financial sense for me because it costs so much more than a comparable car. Will the new Chevy Volt make more financial sense?
The new Chevy Volt is perhaps the most eagerly anticipated new car since the Model T. Since the Volt was first announced, more than 51,000 people have signed up for an unofficial "want list". Chevy recently announced that the official launch markets will be California, Michigan, and Washington, D.C., with an anticipated shipping date of November 2010.
The Chevy Volt is an awesome idea and long overdue. While officially classified as a hybrid, it has also been called a range-extended electric car. What this means is that the Volt is a electric car with a range of 40 miles (three-fourths of Americans commute less than 40 miles per day) and a small gasoline engine to charge the batteries after that, giving it a total range of 640 miles on a tank of gasoline. Since it has a twelve gallon tank this means that its overall fuel economy is about 50 miles per gallon, but during the first 40 miles, it is said to get a staggering 230 mile per gallon equivalent.
Let's Talk Numbers: Does the Chevy Volt Make Sense For Me?
Chevy makes it clear on the Volt website that the car is ideal for commuters who drive 40 miles per day or less, but even after that the fuel economy is still impressive. In determining the cost-effectiveness of this car for you personally, several factors come into play, including the following:
- Are you in the market for a new car? If you are not already in the market for a new car, you would be replacing an existing car. Unless that car is an inefficient clunker or gas-gulping Hummer H2, you may be better off staying with your current ride.
- What other cars are you looking at? If you are looking at a 2010 Camaro ($22,700 and up with less than 29 miles per gallon) or a 2010 Toyota Prius ($23,000 and up with about 50 miles per gallon), it makes a big difference.
- What is the current price of gasoline? While electricity prices are relatively stable, the price of gasoline is volatile, and could once again approach $5 per gallon. Since the Volt runs purely on electricity for the first 40 miles, most commuters would not face a significant increase in the cost of their daily driving. Driving a gasoline car--even a Prius--exposes you to the risk of this price volatility.
- How clean is your electricity? Depending on where you live, your electricity could be produced by a variety of sources such as coal-fired power plants, hydroelectric or wind power plants, or by a mix of various sources. Powering your car from any these sources of energy--even coal--creates fewer greenhouse gas emissions than burning gasoline in an inefficient internal combustion engine. As the "clean energy economy" emerges, the environmental impact of driving a Volt (or other electric car) will decrease, while that of gasoline-powered vehicles will remain the same. If you have solar panels on your home, you could potentially even enjoy virtually "carbon-neutral" driving.
- Do you purchase greenhouse gas offsets for your car? If yes, the reduction in emissions from driving a Volt could be significant, meaning a lower price tag for offsetting a year worth of driving.
So... What's The Answer?
Let's assume that you are in the market for a new car and you are looking for something with good acceleration. You might look at the Camaro mentioned earlier. At an expected $32,500 (after $7,500 tax rebate), the Volt is about $10,000 more expensive than the Camaro. If we assume that you have a daily commute of 40 miles and maybe 80 miles of weekend driving--lets say 15,000 miles per year--the Camaro would burn up 517 gallons of gasoline per year at a cost of $1,550 (or upward of $3,000 if gasoline prices were to reach as high as $6 per gallon). The Volt costs about $2.64 to charge, or $963 per year (assuming one charge per day). So, in this case, assuming no rise in gasoline prices from the present, the Volt, which costs $10,000 more, would save you roughly $600 per year, or a simple payback period of 16.6 years (or 5 years at $6 per gallon).
Who Will Buy the Chevy Volt?
In reality, the average Volt buyer will not buy the car because it makes economic sense. But if we all made truly rational economic decisions, the Hummer H2 and all of its luxury car friends wouldn't have a market and our public transportation system would make Europe envious. No, the Volt--like the Prius and so many of the latest gadgets is green status symbol. And with that said, I am number 7,762 on the unofficial waiting list...though I do have eight months to think it over.
Pablo Paster is a weekly columnist for TreeHugger, an experienced greenhouse gas engineer and the Senior Environmental Program Manager at Hara Software. Send your questions to Pablo(at)TreeHugger.com or submit the via this form, or connect via his RSS feed.
More on Green Cars and Electric Vehicles
Test Drive the Chevy Volt Plug-In Hybrid Electric Car
How Can An Electric Car Travel 100 Miles On $1?
Should I Cash In On My Clunker?
Red Light: Idle or Off?
Abracadabra In The Tailpipe