Lifetime EV cost already high
Biannual levy of $500 on owners makes owning even more expensive
Are electric vehicles cost competitive with their gas-powered equivalents in Nova Scotia?
Not now, unless you’re dropping to a lower-trim model.
And the imposition of a provincial $500 biannual levy on electric vehicles announced in the provincial budget makes them less so.
“If you don’t already have an EV and you’re thinking about maybe buying one, (the levy) will probably make you reconsider it a bit,” said Kurt Sampson, executive director of the Electric Vehicle Association of Atlantic Canada.
“For most people who already own an EV, (the levy) for the most part won’t change the economics of EV ownership … I save more on gas in a month than I will pay in the levy.”
People buy electric vehicles for a lot of reasons other than purely financial. That said, here’s the math on the lifetime cost of electric vehicle ownership in Nova Scotia.
As of 2024, you would need to drive a subcompact electric vehicle 31,426 kilometres annually in order to break even on its higher upfront over its gas equivalent after seven years of ownership.
That’s 219,982 kilometres over seven years.
And it’s assuming you only charged it at home and not at fast chargers located around the province that charge higher rates.
That was the finding of a study comparing the total lifetime cost of electric vehicle ownership by province published by University of British Columbia researcher Bassam Javed in 2024.
Javed’s study broke down total costs of ownership of three comparable models of electric versus gas-powered cars by province. It included local taxes, available rebates, fuel and electricity costs, average provincial driving behaviour, how local temperature cycles would affect the number of recharges and the vehicle’s resale value after seven years.
It calculated the average number of kilometres that would have to be driven annually in each province for the decreased fuel expenses of an EV to catch up with the higher upfront purchasing costs.
“(The goal) is to get policy supports in place to move beyond just the early adopters – higher income, or as second vehicle, luxury vehicles,” Javed, author of Variability in costs of electrifying passenger cars in Canada, told The Chronicle Herald in 2024.
“We want to see a Canada where people are using EVs and benefit from their lower operating costs.”
For Nova Scotia, the study assumed a provincial rebate of $3,000 and a federal rebate of $5,000, which were in place at the time.
While the federal rebate will be renewed this spring after having run out of funds last year, Nova Scotia has since dropped its rebate and the registration levy announced last week would amount to an added cost over seven years.
Beyond that, Nova Scotia’s electricity rates have continued to climb over the past two years, while the price for gasoline at the pump declined when the federal government dropped its consumer carbon tax.
So the purely financial incentives to purchase an electric car in Nova Scotia have got worse for now.
On budget day, Finance Minister John Lohr said the EV levy is meant to spread the cost of road building and maintenance more fairly across all vehicle owners in the province.
Starting Oct. 1, owners of fully electric vehicles will pay $500 and hybrid owners will pay $250 when they renew their vehicle plate stickers every two years.
“I think the reason we introduced this is the recognition these vehicles do impact our highways, (but) they do not pay the motive vehicle tax that a gasoline-type vehicle would,” Lohr said of the fee.
“This is just a calculation of what tax would have been paid by (gasoline vehicle owners) toward the maintenance of our highways.”
Drivers in Nova Scotia pay about 48 cents per litre in combined federal and provincial taxes.
According to the Canadian Taxpayers Federation, those taxes are broken down like this:
■ 10 cents to the federal excise tax;
■ Six cents to the federal portion of sales tax;
■ 5.5 cents in federal fuel standards taxes;
■ 10.8 cents in provincial sales tax;
■ 15.5 cents for provincial excise tax.
Sampson counters that research shows roads are disproportionately damaged by transport trucks and that personal vehicles (electric or gas) contribute only a small portion to wear.
He pointed to experiments by the American Association of State Highway Officials that led to development of what’s known in civic engineering as the “fourth power law,” which quantifies how every doubling of axle load leads to 16 times more damage to road surfaces.
While prices are high now, the upfront cost of electric vehicles has been coming down steadily for 20 years.
Sampson said a recent agreement with China that will result in 50,000 electric vehicles allowed into the country annually can be expected to push prices down at the lower end of the market.
I think the reason we introduced this is the recognition these vehicles do impact our highways, (but) they do not pay the motive vehicle tax that a gasoline-type vehicle would. This is just a calculation of what tax would have been paid by (gasoline vehicle owners) toward the maintenance of our highways.
JOHN LOHR