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You're in the market for a car and want to do your part for the planet by getting an electric vehicle. But with the wide range of model options and costs, knowing where to begin can seem complicated. You may be surprised to learn that many EV owners are finding over time that they're more affordable than their traditional gas vehicles.
Let’s break down everything you need to know about the different types of electric vehicles, financing options, costs, rebates and other considerations, like insurance and maintenance.
Types of electric vehicles
Different types of electric vehicles meet different driving needs. Consider how you will use your car to choose the electric vehicle that will give you a good balance between functionality and emission reductions.
Battery Electric Vehicles (BEV): Battery electric vehicles are powered by electricity stored using high-capacity batteries. If your battery runs low, the car doesn't have an internal combustion engine to take over. But this also means BEVs don't create harmful emissions from burning fuel. These plug-in vehicles are charged using a home charging outlet or charging stations. They are best suited to short-to-medium commutes and day outings.
Hybrid Electric Vehicles (HEV): Hybrid electric vehicles are powered by both an electric battery and an internal combustion engine that takes over at higher speeds or if your electric power runs out. A computer in the car automatically switches between the HEV's two power sources as needed. HEVs do not have to be plugged in for charging. Instead, their electric batteries are charged through regenerative braking, a process by which the speed reduction is captured and converted into power. They are best for medium-to-long trips and travel between towns.
Plug-In Hybrid Electric Vehicles (PHEV): Like HEVs, plug-in hybrid electric vehicles have two motors – an electric motor and an internal combustion engine. However, unlike regular hybrid electric vehicles, PHEVs can be plugged in to charge, allowing them to run primarily on electricity. When that electric charge runs out, the car automatically switches to run on the internal combustion engine. This makes PHEVs a good fit for short trips where they can run on electricity alone and longer ones using a combination of electricity and the combustion engine.
Extended-Range Electric Vehicles (E-REV): Extended-range electric vehicles offer three power sources: a combustion engine, a plug-in battery and an electric motor. E-REVs switch between these power sources, allowing for emissions reduction and longer periods of electricity use. E-REVs are less common than other types of electric vehicles, but they are a good option for people who need to drive over long distances.
Fuel Cell Electric Vehicles (FCEV): Fuel cell electric vehicles use hydrogen to create electricity, producing water as emissions. These cars continue to run for as long as they have enough hydrogen to generate battery power. FCEVs are refillable at fuelling stations that offer hydrogen and charge more quickly than electric vehicles. With a range of 480 to 640 kilometres on a tank of hydrogen,1 FCEVs are perfect for travelling long distances.
Financing
Deciding which type of electric vehicle that you want is just the first step in your purchase. Next, you need to determine how to pay for your new car. If you aren't able to buy your vehicle with cash, you'll need to borrow the money through a lease or a loan. It's possible to buy a vehicle with a personal loan, but auto loans often lower interest rates because your car is put up for collateral, reducing the risk for lenders.
Scotiabank offers an EV loan to help people buy an electric vehicle. Scotiabank also offers special programs for people of specific demographics who want to buy a new car, including the Grad Auto program for recent post-secondary graduates and the StartRight auto program for newcomers to Canada.
Leasing vs buying
The cost of a new electric vehicle in Canada ranges from $39,000 to $325,000.2 However, depending on the type and specific model you select and the incentives available, your EV could be cheaper than average.
With time, EVs have progressed to provide higher quality, longer track records and a broader range of available models, which means more people are purchasing than they were years ago. But even with price drops and incentives for some electric vehicle models, some experts still recommend leasing an EV instead of buying one. Leasing allows you to access rebates for electric vehicles and enjoy lower payments. Leasing is a way to avoid the significant depreciation many EVs face. Also, given how quickly battery technology and charging standards evolve, leasing is a way to avoid getting stuck with outdated tech. However, you will not own your vehicle when your lease term ends.
The right decision for you depends on your situation and needs. Research the depreciation and resale price of the model you want to buy to determine what makes the most financial sense.
Other costs
In addition to the purchase price, electric vehicles have several costs that differ from those for conventional cars. Here's what you need to know:
Charging costs
Electric vehicles' charging time ranges from 30 minutes to more than 12 hours. But even at those longer charging times, charging your vehicle fully at usually only pennies per minute is relatively inexpensive. Finding a charging station has become much easier as more are built, and there are apps and different websites that allow you to find and reserve a space nearby.
If your home already has an outlet to charge your car, you'll be charged for only the regular cost of the electricity used. However, if you don't already have outlets accessible, it can be expensive to set up charging capacity in your home, apartment or townhome. The cost can range from $300 to $20,000, depending on the building and if you need to hire an electrician.
Three kinds of home chargers are available: level 1 chargers, level 2 chargers and level 3 chargers:
- Level 1 chargers connect to a standard 120-volt AC outlet and charge 3 to 8 kilometres per hour,3 with a total charging time ranging from 5 to 6 hours for PHEVs to 40 to 50 hours for BEVs.
- Level 2 chargers use a 240-volt outlet, the same type used for ovens and dryers. They charge 16 to 32 kilometres per hour, with a total charging time ranging from 1 to 2 hours for PHEVs to 4 to 10 hours for BEVs.
- Level 3 chargers – also known as fast chargers – use a DC connection to an electrical system, charging 289 to 386 kilometres per hour, with a total charging time ranging from 20 minutes to 1 hour for BEVs.
Level 1 and 2 chargers are most commonly used for residences, while level 3 are often found at industrial sites and gas stations. Some residential EV chargers may be eligible for provincial rebates on their purchase price, which range from $300 to $800 for level 1 chargers to $1,000 to $7,500 for level 2 chargers.
Insurance
Many people wonder if insurance is more expensive for electric vehicles. The good news is that your vehicle's fuel source doesn't affect your insurance premiums. However, some electric cars are costly to repair, which can increase their insurance costs. In the event of a collision, some EV batteries are expensive to replace. Also, repairs on electric cars can require specialized mechanics due to the vehicles' differences from conventional cars, including their complex computer systems. Different makes and models of EVs can vary in insurance costs – before purchasing, call ahead for an insurance quote on the model you prefer.
Maintenance
Owning an electric vehicle doesn't just save on gas, it can also reduce your vehicle maintenance costs. According to the Canadian Automobile Association, the average EV owner saves about 40% to 50% on maintenance compared to a conventional vehicle. Not only will you spend less time at the shop, but those savings can also add up to thousands of dollars over the life of your vehicle.
Incentives
There are considerable federal and provincial incentives available when you purchase or lease an electric vehicle in Canada. The Government of Canada's ZEV Program offers point-of-sale incentives for consumers who buy or lease a battery electric vehicle, plug-in hybrid electric vehicle or fuel cell electric vehicle.
Several provinces also offer additional incentives to purchase EVs. British Columbia offers between $500 and $4,000 in incentives, depending on the range of the vehicle purchased. Newfoundland and Labrador offer savings of $1,500 to $2,500 for electric vehicle purchases. In Nova Scotia, new EVs are eligible for up to $3,000 in rebates, while used ones are eligible for up to $2,000. New Brunswickers are eligible for rebates up to $5,000 and Prince Edward Islanders are eligible for rebates up to $5,750, depending on the type of electric vehicle purchased. Rebates for home EV chargers are also available in many parts of Canada.
Ready to buy an electric car?
Before making your purchase, add up all the costs of an electric vehicle and decide on your budget. Consider your needs to determine what type and model are best for you. Research resale value and depreciation to help you determine if you should lease or buy your car. And of course, shop around for the best deal before you make your final decision.
Once you've made your purchase, remember it can take time to get used to your new car and its different maintenance cycles. However, from your first day as an EV owner you can enjoy the peace of mind of knowing you're reducing your emissions and carbon footprint!
