When it comes to electric vehicles (EVs), one of the most common claims is that they are cheaper to drive compared to traditional gasoline cars.

But is that really the case?

With rising fuel costs, the promise of lower running expenses is appealing, yet EVs come with their own set of considerations, from purchase price to charging infrastructure.

Do the savings on fuel and maintenance truly outweigh these factors?

And how do things like battery lifespan and charging habits affect the overall cost?

Let’s explore the real financial impact of driving electric vehicles

Note: For this blog, we’ll take the Tata Nexon EV as an example, as this is the most popular EV in the Indian automobile market.

The Initial Cost: Higher Price, But Better Value?

There’s no getting around it—most EVs come with a higher sticker price than their gas-powered counterparts.

For example, in India, the Tata Nexon EV costs about ₹13 lakh, while the ICE (internal combustion engine) version of the Nexon starts at around ₹8 lakh. So, right off the bat, you’re paying a premium.

Why the extra cost?

Batteries are the biggest contributor. EV batteries, typically lithium-ion, are still expensive to manufacture, although prices are dropping as technology improves. The government does offer subsidies and tax breaks for EV buyers, which helps lower the cost a bit.

Now, let’s think long-term.

That higher initial cost can be recouped over time through savings in other areas like charging and maintenance.

Charging Costs vs. Fuel Costs

One of the biggest perks of driving an electric vehicle is the cost of charging compared to fueling up with gasoline. On average, the cost of electricity is lower than that of fuel. But exactly how much you save depends on where you charge.

Charging at Home

If you’re charging at home, your costs are tied directly to your electricity rates. In India, electricity typically costs around ₹5 to ₹10 per unit (kWh), and most EVs, like the Tata Nexon EV or the Citroen Basalt, consume about 15-20 kWh per 100 kilometers.

So, driving 100 kilometers in an EV could cost you anywhere between ₹75 to ₹200.

Compare that to a gasoline car that might give you around 15 km per liter, and with current fuel prices hovering around ₹100 per liter, you’re spending about ₹650 to cover the same distance.

This massive difference adds up quickly, especially for those who drive regularly.

Over a year, a person driving 1,000 km a month could save as much as ₹60,000 in fuel costs. And if you install solar panels at home, your charging costs could drop even further, potentially to zero.

The Case for Solar EV Charging

Solar-based charging systems are gaining traction as an effective way to green the charging process.

Solar photovoltaic (PV) panels capture sunlight and convert it into electricity, which is then used to charge the vehicle’s battery.

This method completely bypasses the traditional grid, ensuring that no fossil fuels are burned in the process.

A typical home solar setup with a 5 kW system can generate approximately 20 kWh per day, enough to fully charge a mid-sized electric vehicle (like a Tesla Model 3) after driving 80-100 miles.

To learn in detail about this topic, we recommend that you go through our guide which explores how green we are with EVs.

Public EV Charging

Public charging stations usually charge higher rates, typically between ₹15 and ₹25 per kWh. Charging at these stations can be convenient for long trips, but it does cut into your savings a bit compared to home charging. However, even with higher public charging rates, it’s still cheaper than filling up a tank of gas.

Related: Public vs Home EV Charging

Maintenance: The Hidden Savings of Electric Vehicles

Maintenance is another area where EVs shine. Traditional gas-powered vehicles have engines with hundreds of moving parts—pistons, cylinders, crankshafts—all of which need regular servicing, oil changes, and repairs. EVs, on the other hand, have far fewer moving parts.

Many of the most common vehicle maintenance issues just don’t apply to EVs.

There’s no need for oil changes, transmission repairs, spark plugs, or fuel filters.

What you do have to worry about are things like brake pads, tires, and the occasional software update. While you may still need to replace brake pads and tires like any other car, EVs often use regenerative braking, which reduces the wear on brake pads, meaning they last longer.

According to a 2020 study by Consumers Union, EV owners in the U.S. spend about 50% less on maintenance over the life of their vehicles compared to gas-powered car owners.

While the figures might vary slightly in India, the principle holds: that fewer parts equal less maintenance.

Battery Replacement: The Elephant in the Room

One of the biggest concerns for potential EV buyers is the lifespan and replacement cost of the battery.

EV batteries do degrade over time, but thanks to advances in battery management systems, they’re lasting longer than many people expect. Most automakers offer warranties of 8 to 10 years (or around 160,000 km) for their batteries, giving buyers peace of mind.

However, battery replacements can be costly—upwards of ₹5-6 lakh, depending on the model.

The good news is that most owners won’t need to replace their batteries within the typical lifespan of the vehicle, especially with proper maintenance.

And by the time you do need a new battery, prices are expected to drop even further as technology evolves.

Exploring The Resale Value of Electric Cars

Resale value is still a bit of a wildcard in the EV world.

Since EVs are relatively new to the mass market, there’s less data on how well they hold their value. However, as battery technology improves and EVs become more popular, resale values are expected to climb.

Some early studies suggest that EVs could hold their value better than gas cars, especially in regions where governments are pushing for electric mobility.

Total Ownership Cost: Are Electric Vehicles Worth It?

To give you a clearer picture, let’s use the Tata Nexon EV as an example and compare it to its petrol variant, the Tata Nexon ICE.

The initial price difference is noticeable, but the long-term savings from charging and maintenance often tilt the scale in favor of electric vehicles.

Year 1:

Upfront Cost:

Tata Nexon EV: ₹14.74 lakh (ex-showroom)

Tata Nexon Petrol (XZA Plus): ₹10.25 lakh (ex-showroom) Right from the start, you’re paying about ₹4.5 lakh more for the EV variant. But while this may seem like a big jump, the real savings start after purchase.

Fuel vs. Charging Costs:

Electricity for Nexon EV:

Charging a Tata Nexon EV at home for a year (driving 12,000 km) will cost you approximately ₹20,160. Here’s the math: The Nexon EV has a battery capacity of 30.2 kWh, and the vehicle consumes about 15 kWh per 100 km. If your electricity cost is ₹10 per unit (kWh), that adds up to around ₹15 per 100 km. Multiply that by 12,000 km, and your yearly home charging cost is about ₹20,160.

Petrol for Nexon ICE:

On the other hand, the Tata Nexon Petrol has a fuel economy of approximately 17 km per liter . With petrol prices hovering around ₹100 per liter , driving 12,000 km a year would cost ₹70,588 (12,000 km ÷ 17 km/l × ₹100/l). The difference is clear: in the first year, you save about ₹50,000 on fuel by driving the electric version.

Maintenance Costs:

Nexon EV: ₹5,000 annually (minimal, since EVs require less servicing)

Nexon Petrol: ₹10,000 annually (including regular oil changes, engine upkeep, etc.)

Year 5:

Now, let’s look at the total cost after five years of ownership, including fuel/charging and maintenance.

Total Costs for Tata Nexon EV:

Initial Cost: ₹14.74 lakh

Charging Costs: ₹1 lakh (₹20,160/year × 5 years)

Maintenance Costs: ₹25,000 (₹5,000/year × 5 years) Total After 5 Years: ₹15.99 lakh

Total Costs for Tata Nexon Petrol:

Initial Cost: ₹10.25 lakh

Fuel Costs: ₹3.53 lakh (₹70,588/year × 5 years)

Maintenance Costs: ₹50,000 (₹10,000/year × 5 years) Total After 5 Years: ₹14.28 lakh

Year 5 Comparison: EV vs. Petrol

After five years, the Tata Nexon EV will cost you approximately ₹15.99 lakh, while the petrol variant will set you back about ₹14.28 lakh.

So, after five years, the gap has narrowed significantly—from ₹4.5 lakh at the time of purchase to just ₹1.71 lakh after factoring in all the costs.

If we extend this analysis to 8 or 10 years, the savings continue to grow in favor of the EV.

By year 10, you’re likely to have saved close to ₹3.5 lakh compared to the petrol version, thanks to the lower running and maintenance costs of the Nexon EV.

These numbers don’t even factor in the potential increase in fuel prices or any additional subsidies that might be introduced in the future, which would tilt the equation even more in favor of electric vehicles.

The Bottom Line: Are Electric Vehicles Cheaper to Drive?

In the short term, buying electric vehicles is a more expensive option due to the higher upfront cost.

But over the life of the vehicle, you’re likely to save significantly on fuel and maintenance costs. If you’re planning to keep your car for five years or more, those savings will begin to outweigh the initial price difference, making EVs the more economical choice.

Plus, with the growing network of charging stations and improvements in battery life, the case for EVs only gets stronger with time.

So, while it might take a little bit of patience, electric vehicles really can be cheaper to drive in the long run.

And let’s not forget the other benefit—you’re driving a cleaner, greener vehicle that’s helping the environment too.