A report released by the University of Michigan’s Transportation Research Institute is showing the cost savings to the average vehicle owner versus those same owners driving electric. The report compares gasoline fuel costs state-by-state to the cost of electricity for equivalent miles driven. The differences are shown in both ratios and dollar figures, with owners in some specific states seeing much higher savings when driving electric versus those from other states.
The report is unique in that it ignores the often-politicized arguments for data of this nature; such as the “source-to-use” data often manipulated or argued. Instead, it looks purely from a consumer perspective, showing what kinds of cost savings could be had for the average vehicle owner in any given state.
By comparing the average fuel economy of cars sold with the average expected range of a battery-electric vehicle sold on the market, the report found that drivers in Washington State, Oregon, Idaho, Louisiana, and Utah would save the most by switching to an electric vehicle. Drivers in Hawaii, New Hampshire, Connecticut, Rhode Island, and Massachusetts would save the least. Most of these differences are due to a lower disparity between gasoline costs and residential electricity costs in the latter list of states and a higher disparity between those in the former list.
The report’s data considered the average driving distance and amount per state (NHTSA data), the average fuel economy of vehicles sold in that state (per another UofM study), the average cost per gallon for gasoline state-by-state (according to AAA), and the average cost of electricity in each state (per EIA). The report then compared these to one another.
The average cost of gasoline in the United States, as of December 23, 2017, was $2.441 per gallon. The highest price was in Hawaii at $3.297 per gallon and the lowest was in Alabama at $2.169. High fuel costs, however, did not always translate directly into more savings with a battery electric vehicle. Similarly, lower fuel costs were not necessarily a guarantee that the payoff for going electric would be minimal. Electricity costs could change that.
And they did. The average price of residential electricity in the United States, as of October 2017, was $0.1284 per kilowatt hour. Hawaii had the highest price at $0.2929 per kWh and Louisiana had the lowest at $0.0972/kWh. The higher cost of electricity was more of an indicator of lower gains by going to an electric vehicle than were gasoline prices. Most of the states in the top five for benefiting the least by going electric were also within the top ten for the highest-priced electricity. Yet the states with the lowest-priced electricity were not likely to show up on the top five list for the best gains by getting an EV.
For overall averages nationwide, the cost of driving a gasoline vehicle was $1,117 per year while the average cost of driving a battery electric vehicle was $485. On the whole, most Americans can expect to save at least something if they go to an electric vehicle for most of their driving.
Also interesting was the average fuel economy required in order to meet or better the electric vehicle’s cost savings to the owner. Even in the worst states, where ratios were lowest, the average fuel economy was relatively high. In Hawaii, where a gasoline car owner can only expect to save about $400 per year for getting an EV, the required fuel economy to average that cost ratio out to $0 is 34.1 mpg. In the average state, the fuel economy required is around 57.6 mpg. In the state of Washington, a full 90 mpg is required to break even with an electric car.
These numbers are interesting and should speak directly to consumers at a bare-bones pocketbook level. Buying an EV can mean significant annual savings. The report, Relative Costs of Driving Electric and Gasoline Vehicles in the Individual U.S. States, can be found at this link.
Energy
Tesla Lathrop Megafactory celebrates massive Megapack battery milestone
The Tesla Megapack is the backbone of Tesla Energy’s battery deployments.
The Tesla Lathrop Megafactory recently achieved a new milestone. As per the official Tesla Megapack account on X, the Lathrop Megafactory has produced its 15,000th Megapack 2 XL battery.
15,000 Megapack Batteries
Tesla celebrated the milestone with a photo of the Lathrop Megafactory team posing with a freshly produced Megapack battery. To commemorate the event, the team held balloons that spelled out “15,000” as they posed for the photo.
The Tesla Megapack is the backbone of Tesla Energy’s battery deployments. Designed for grid-scale applications, each Megapack offers 3.9 MWh of energy and 1.9 MW of power. The battery is extremely scalable, making it perfect for massive energy storage projects.
More Megafactories
The Lathrop Megafactory is Tesla’s first dedicated facility for its flagship battery storage system. It currently stands as the largest utility-scale battery factory in North America. The facility is capable of producing 10,000 Megapack batteries every year, equal to 40 GWh of clean energy storage.
Thanks to the success of the Megapack, Tesla has expanded its energy business by building and launching the Shanghai Megafactory, which is also expected to produce 40 GWh of energy storage per year. The ramp of the Shanghai Megafactory is quite impressive, with Tesla noting in its Q1 2025 Update Letter that the Shanghai Megafactory managed to produce over 100 Megapack batteries in the first quarter alone.
Tesla Energy’s Potential
During the first quarter earnings call, CEO Elon Musk stated that the Megapack is extremely valuable to the energy industry.
“The Megapack enables utility companies to output far more total energy than would otherwise be the case… This is a massive unlock on total energy output of any given grid over the course of a year. And utility companies are beginning to realize this and are buying in our Megapacks at scale,” Musk said.
Energy
Tesla Megapacks powers the xAI Colossus supercomputer
Tesla Megapacks step in to stabilize xAI’s Colossus supercomputer, replacing natural gas turbines. Musk’s ventures keep intertwining.
Tesla Megapack batteries will power the xAI Colossus supercomputer in Memphis to ensure power stability. The collaboration between Tesla and xAI highlights the synergy among Elon Musk’s ventures.
The artificial intelligence startup has integrated Tesla Megapacks to manage outages and demand surges, bolstering the facility’s reliability. The Greater Memphis Chamber announced that Colossus, recently connected to a new 150-megawatt electric substation, is completing its first construction phase. This transition addresses criticism from environmental justice groups over the initial use of natural gas turbines.
“The temporary natural gas turbines that were being used to power the Phase I GPUs prior to grid connection are now being demobilized and will be removed from the site over the next two months.
“About half of the operating turbines will remain operating to power Phase II GPUs of xAI until a second substation (#22) already in construction is completed and connected to the electric grid, which is planned for the Fall of 2025, at which time the remaining turbines will be relegated to a backup power role,” the Chamber stated.
xAI’s rapid development of Colossus reflects its ambition to advance AI capabilities, but the project has faced scrutiny for environmental impacts. The shift to Megapacks and grid power aims to mitigate these concerns while ensuring operational continuity.
The Megapack deployment underscores the collaboration among Musk’s companies, including Tesla, SpaceX, Neuralink, and The Boring Company. Tesla appears to be the common link between all of Musk’s companies. For example, The Boring Company built a tunnel in Giga, Texas. In addition, Musk has hinted at a potential collaboration between the Tesla Optimus Bot and Neuralink. And from January 2024 to February 2025, xAI invested $230 million in Megapacks, per a Tesla filing.
Tesla Energy reported a 156% year-over-year increase in Q1 2025, deploying 10.4 GWh of storage products, including Megapacks and Powerwalls. Tesla’s plans for a new Megapack factory in Waller County, Texas, which is expected to create 1,500 jobs in the area, further signal its commitment to scaling energy solutions.
As xAI leverages Tesla’s Megapacks to power Colossus, the integration showcases Musk’s interconnected business ecosystem. The supercomputer’s enhanced stability positions xAI to drive AI innovation, while Tesla’s energy solutions gain prominence, setting the stage for broader technological and economic impacts.
Energy
Tesla Energy celebrates one decade of sustainability
Tesla Energy has gone far since its early days, and it is now becoming a progressively bigger part of the company.
Tesla Energy recently celebrated its 10th anniversary with a dedicated video showcasing several of its milestones over the past decade.
Tesla Energy has gone far since its early days, and it is now becoming a progressively bigger part of the company.
Tesla Energy Early Days
When Elon Musk launched Tesla Energy in 2015, he noted that the business is a fundamental transformation of how the world works. To start, Tesla Energy offered the Powerwall, a 7 kWh/10 kWh home battery system, and the Powerpack, a grid-capable 100 kWh battery block that is designed for scalability. A few days after the products’ launch, Musk noted that Tesla had received 38,000 reservations for the Powerwall and 2,500 reservations for the Powerpack.
Tesla Energy’s beginnings would herald its quiet growth, with the company later announcing products like the Solar Roof tile, which is yet to be ramped, and the successor to the Powerwall, the 13.5 kWh Powerwall 2. In recent years, Tesla Energy also launched its Powerwall 3 home battery and the massive Megapack, a 3.9 MWh monster of a battery unit that has become the backbone for energy storage systems across the globe.
Key Milestones
As noted by Tesla Energy in its recent video, it has now established facilities that allow the company to manufacture 20,000 units of the Megapack every year, which should help grow the 23 GWh worth of Megapacks that have already been deployed globally.
The Powerwall remains a desirable home battery as well, with more than 850,000 units installed worldwide. These translate to 12 GWh of residential entry storage delivered to date. Just like the Megapack, Tesla is also ramping its production of the Powerwall, allowing the division to grow even more.
Tesla Energy’s Role
While Tesla Energy does not catch as much headlines as the company’s electric vehicle businesses, its contributions to the company’s bottom line have been growing. In the first quarter of 2025 alone, Tesla Energy deployed 10.4 GWh of energy storage products. Powerwall deployments also crossed 1 GWh in one quarter for the first time. As per Tesla in its Q1 2025 Update Letter, the gross margin for the Energy division has improved sequentially as well.
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