This Blog Post is Worth $100,000

I recently began to wonder is all this effort in efficiency, solar, etc worthwhile…or just wasting time over pennies saved? So I decided to look at the big picture and see what I spend on energy versus an average neighbor and how much CO2 difference that makes.

Our utility (PSE) shows average neighbor energy use. Those neighbors are selected to match our home – single family homes of about 2700 square feet, within 1.8mi, natural gas heat, and an average 4 occupants. From that average usage data we can figure out energy spend for electricity and natural gas.

I also wanted to consider the cars – gas is a huge part of people’s energy expenditures which is easy to overlook without a monthly bill. We drive about 20,000 miles annually on our electric vehicles, so I’ll figure my “average” neighbor will drive the same 20k miles in a car getting 25MPG (the 2018 average for new vehicles according to the EPA). I’m also going to assume the average price of gas is $3/gallon which is a pretty typical price for Western Washington (if not low).

Our HouseAverage NeighborCO2 Difference
Annual Electric Cost$520$13337404 lbs
Annual Natural Gas Cost$494$9505798 lbs
Annual Gasoline Cost$0$240016000 lbs
Annual Total$1014$468329202 lbs

Now in fairness what’s missing is the solar array cost. The cost of the array plus loan interest, minus incentives divided by the 25 year life means the solar array costs $590/year. But I decided instead of looking at it annually, lets look at the entire energy spend over 25 years.

You might also wonder if we spend $520/year on PSE power and $590 on solar power…aren’t we spending almost as much on power as my average neighbor? Yes but we actually use more power than our average neighbor not because of inefficiency but because that’s powering the house and two cars.

So back to the 25 year analysis, over long periods I think its worth considering inflation as well. For example PSE natural gas has gone up ~11% last year and PSE was seeking another ~7% this year for gas and electricity. Obviously that doesn’t happen every year but I’m going to assume a fairly modest 2% based on historical averages. In fairness its unlikely anyone’s energy use will remain constant over 25 years, but efficiency improvements may very well get offset by more electronics, more cooling, etc.

Our HouseAverage Neighbor
25 Year Energy Spend
Assuming 2% inflation
Solar Array Cost
Including Loan Interest
and Incentives
25 Year Energy Spend$47,378$150,000

Which brings us back to the title of this article, that’s $100,000 in the pocket of the efficient homeowner vs. the average home. So yes, energy efficiency is worth the effort not just for environmental impact but cost of living.

Hybrids Still Have Value

While I love electric vehicles I know they’re not for everyone. If you don’t have a place to plug in, need to regularly drive long distances, live in the midwest, or need more vehicle type options – hybrids can be a good solution to reduce emissions and lower your operating costs.

Hybrid Emissions vs Other Vehicle Types
Hybrids can be significantly more efficient than a conventional gasoline powered car. For example a Hyundai Elantra gets 35MPG, while the Hyundai Ioniq Hybrid gets 58MPG. That means buying 170 fewer gallons of gas each 15k miles and reducing emissions by around 3200lbs CO2.

Believe it or not the emissions of a hybrid can be lower than an EV depending on where you get your power. For example in coal generated power markets (the midwest) a hybrid can have lower emissions than an EV. Though in most of America an EV will have lower emissions than a hybrid.

Some Hybrids Are Great Values
Hybrid drivetrains have historically cost a lot more than their conventional gas counterparts, but the cost difference is becoming smaller as the batteries and electronics have gotten cheaper. For example the RAV4 Hybrid XLE AWD costs only $800 more than the conventional RAV4 XLE AWD. According to the RAV4 Hybrid will save the average driver $450/year, so in less than 2 years the extra cost of the hybrid has paid off.

Hybrids also tend to be a bit unloved which means sometimes you’ll find great deals for cars sitting on lots. This is because the market for the Eco-conscious is going EV and other buyers tend to not understand the value of a hybrid. For example I found a Kia Optima Hybrid EX for $25,549, thousands less than the MSRP on a conventional Kia Optima EX. While its not the most efficient hybrid on the market, its a great price for a well equipped family sedan with 41MPG.

Obviously each hybrid will be different, but there’s definitely some good deals out there.

Should I Be Worried About the Batteries?
The internet is full of horror stories about $4000-5000 hybrid battery replacements, but a bit of research can help you understand and avoid that cost. First you have to understand that hybrid batteries tend to carry long warranties – commonly 100,000-150000, though Hyundai is notable for a lifetime battery warranty. So unless you keep cars a long time you may never be out of battery warranty.

If you need a new battery avoiding the dealership repair shop is also a great idea. For example I found a new Prius battery replacement for $2300 at a reputable independent repair shop, you can also save even more with a bit of DIY skills – its really just a few bolts and electrical connectors to remove many hybrid batteries.

Consider the worst case – the battery dies at 100001 miles. During this time you’ve saved $3000 in gas on the RAV4, so a $2300 battery repair still isn’t too bad. Realistically the battery will last far longer, but worst case still isn’t that bad.

My Favorite Hybrids

Compact Sedan
Hyundai Ioniq – While Prius is practically synonymous with hybrids the Ioniq is better looking, better equipped, gets better gas mileage, has better battery tech, has a lower MSRP, and has a much better warranty. 58mpg, starting price just over $21k.

Subcompact Crossover(ish)
Kia Niro – admittedly the Niro has no real competition in the subcompact crossover-ish hybrid category. But if you need a bit more space than a Ioniq for the Niro is the natural choice. 50mpg, starting price around $23.5k.

Compact AWD Crossover
Toyota RAV4 – if you need a compact crossover with AWD the RAV4 is in a class of its own for efficiency and performance. Unfortunately the interior quality is really lacking for the price. 40mpg and a starting price around $28k.

Admittedly there’s plenty more hybrid categories but these are a couple of my favorites in the hybrid market.

The VW eGolf is cheaper than the VW Golf

EVs have earned a reputation for being impractical and expensive. However battery prices have fallen to roughly 1/10 of an decade ago, meaning EVs are starting to look like a really good deal.

Take for example the EV version of the VW Golf – the eGolf. The eGolf SE trim costs $22995 after federal rebate, while the gas powered Golf SE costs $24145!

Now say you drive 15000 miles a year in the NW. The electricity for the eGolf will cost about $375, the gas for a Golf around $1363 assuming gas stays at $3/gallon. Not only will you save about $1000 on fuel, but no oil changes, brake service, etc.

Admittedly the eGolf is a lower range EV, about 120 miles. So it’s definitely fine for day to day use, but not the Golf you want for a road trip. But before you dismiss it, keep in mind if you have a two car household you probably don’t need both cars to be road trip ready.

On the extra cost side you’ll also need a charger – if this is a second car for commuting you might get by with a normal 120v outlet but you may need to spend another ~$400 plus install for a 240v charger.

Besides cost why should you care about an electric vehicle? According to the Union of Concerned Scientists an EV driven in the US averages the same cradle to grave emissions as a gasoline car getting 80mpg (96 for my friends in the NW). Given that no conventional or hybrid car on the market gets that kind of MPG, its a pretty impressive improvement which will continue to get better as more utilities switch to renewable power.

Even if you’re not compelled by the eGolf, here’s what’s cool – a bit less than a decade ago the battery pack alone for the eGolf would have cost more than the whole car. Given current trends in a matter of years EVs with much larger batteries will be the same purchase price as a gas powered car while still maintaining their low operating cost.

Besides price I actually really enjoyed my eGolf test drive – its agile, well balanced, and punchy off the line. Plus it looks like a normal Golf, which pretty appealing for those who don’t want to drive around in something that looks like an alien bug.

Bottom line – if you have a place to charge, an EV is starting to be a practical reality for more new car buyers and will keep getting more practical every year.

Is the Kia Niro worth the price premium?

The Kia Niro is a new subcompact crossover with a class leading up to 51mpg average fuel economy. But it also costs more than other subcompact crossovers – leading to the obvious question of is the Niro worth paying more for?

Niro Overview

The Niro is a stealth hybrid – a hybrid that looks and drives like a normal crossover. If you’ve driven a Prius, you’ll get what I mean – the older models drive like a washing machine and they all look weird. Kia’s choice to make the Niro a crossover certainly will broaden the appeal. Continue reading

Why You Shouldn’t Buy Cars In Cash (and ignore the finance gurus)

This is part two on buying vs leasing cars. In the first installment we looked at getting a loan vs a lease. I recommend reading that post first if you haven’t as we’ll reference costs better explained in that article.

Rather than get a car loan or lease – a number of finance gurus think you should save up and buy cars in cash.

While the pain of writing a check for your dream car may temper your spending, with a bit of impulse control and math you’ll see buying a car in cash isn’t a great idea.

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Why You Should Lease a Car (and Ignore the Finance Gurus)

I got into a debate the other day about leasing vs buying cars. While most people were in the anti-leasing camp, I have to dissent IF (and its a big if) you do it right. By the way, this topic is 100% about finances, not at all about being eco friendly.

Now right off the bat I’ll say a lot of links were shared to “personal finance gurus” like Natalie Bacon and Dave Ramsey. These links were nonsensical at best (Ms Bacon’s main argument against leasing and for buying is because you should accumulate assets that go up in value, though cars do the opposite) and I’ll argue also offer financially poor advice.

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Why the Kia Soul EV is the Perfect Car For Seattle

If there’s any two things I love, its being cheap and being green – two things that rarely go hand in hand. But I must say in the case of cars, the Soul EV does both well.

Lease Cost

In Seattle Lee Johnson Kia is the local place with the best deals on the Soul EV (I visited six dealers). Right now a Soul EV is $119/mo with $2636 up front ($192/mo) while a gas base model Soul is $136/mo and $1999 up front ($192/mo). But the EV delivers more value with the traffic nav, 8” touchscreen, heated seats and steering wheel, etc. Score one for the Soul EV – delivering more value for the same price as an equivalent gas car.

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