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 inks multi-billion-dollar deal with LG Energy Solution to avoid tariff pressure
Tesla has reportedly secured a sizable partnership with LGES for LFP cells, and there’s an extra positive out of it.
Tesla has reportedly inked a multi-billion-dollar deal with LG Energy Solution in an effort to avoid tariff pressure and domesticate more of its supply chain.
Reuters is reporting that Tesla and LGES, a South Korean battery supplier of the automaker, signed a $4.3 billion deal for energy storage system batteries. The cells are going to be manufactured by LGES at its U.S. factory located in Michigan, the report indicates. The batteries will be the lithium iron phosphate, or LFP, chemistry.
Tesla delivers 384,000 vehicles in Q2 2025, deploys 9.6 GWh in energy storage
It is a move Tesla is making to avoid buying cells and parts from overseas as the Trump White House continues to use tariffs to prioritize domestic manufacturing.
LGES announced earlier today that it had signed a $4.3 billion contract to supply LFP cells over three years to a company, but it did not identify the customer, nor did the company state whether the batteries would be used in automotive or energy storage applications.
The deal is advantageous for both companies. Tesla is going to alleviate its reliance on battery cells that are built out of the country, so it’s going to be able to take some financial pressure off itself.
For LGES, the company has reported that it has experienced slowed demand for its cells in terms of automotive applications. It planned to offset this demand lag with more projects involving the cells in energy storage projects. This has been helped by the need for these systems at data centers used for AI.
During the Q1 Earnings Call, Tesla CFO Vaibhav Taneja confirmed that the company’s energy division had been impacted by the need to source cells from China-based suppliers. He went on to say that the company would work on “securing additional supply chain from non-China-based suppliers.”
It seems as if Tesla has managed to secure some of this needed domestic supply chain.
Energy
Tesla Shanghai Megafactory produces 1,000th Megapack for export to Europe
The Shanghai Megafactory was able to hit this milestone less than six months after it started producing the Megapack.
Tesla Energy has announced a fresh milestone for its newest Megapack factory. As per the electric vehicle maker, the Shanghai Megafactory has successfully produced its 1,000th Megapack battery.
The facility was able to hit this milestone less than six months after it started producing the grid-scale battery system.
New Tesla Megapack Milestone
As per Tesla Asia in a post on its official accounts on social media platform X, the 1,000th Megapack unit that was produced at the Shanghai Megafactory would be exported to Europe. As noted in a CNEV Post report, Tesla’s energy products are currently deployed in over 65 countries and regions globally. This allows Tesla Energy to compete in energy markets that are both emerging and mature.
To commemorate the 1,000th Megapack produced at the Shanghai Megafactory, the Tesla China team posted with the grid-scale battery with celebratory balloons that spelled “Megapack 1000.” The milestone was celebrated by Tesla enthusiasts on social media, especially since the Shanghai Megafactory only started its operations earlier this year.
Quick Megafactory Ramp
The Shanghai Megafactory, similar to Tesla’s other key facilities in China, was constructed quickly. The facility started its construction on May 23, 2024, and it was hailed as Tesla’s first entry storage project outside the United States. Less than a year later, on February 11, 2025, the Shanghai Megafactory officially started producing Megapack batteries. And by March 21, 2025, Tesla China noted that it had shipped the first batch of Megapack batteries from the Shanghai plant to foreign markets.
While the Shanghai Megafactory is still not at the same level of output as Tesla’s Lathrop Megafactory, which produces about 10,000 Megapacks per year, its ramp seems to be quite steady and quick. It would then not be surprising if Tesla China announces the Shanghai Megafactory’s 2,000th Megapack milestone in the coming months.
Energy
Tesla launches first Virtual Power Plant in UK – get paid to use solar
Tesla has launched its first-ever Virtual Power Plant program in the United Kingdom.
Tesla has launched its first-ever Virtual Power Plant program in the United Kingdom. This feature enables users of solar panels and energy storage systems to sell their excess energy back to the grid.
Tesla is utilizing Octopus Energy, a British renewable energy company that operates in multiple markets, including the UK, France, Germany, Italy, Spain, Australia, Japan, New Zealand, and the United States, as the provider for the VPP launch in the region.
The company states that those who enroll in the program can earn up to £300 per month.
Tesla has operated several VPP programs worldwide, most notably in California, Texas, Connecticut, and the U.S. territory of Puerto Rico. This is not the first time Tesla has operated a VPP outside the United States, as there are programs in Australia, Japan, and New Zealand.
This is its first in the UK:
Our first VPP in the UK
You can get paid to share your energy – store excess energy in your Powerwall & sell it back to the grid
You’re making £££ and the community is powered by clean energy
Win-win pic.twitter.com/evhMtJpgy1
— Tesla UK (@tesla_uk) July 17, 2025
Tesla is not the only company that is working with Octopus Energy in the UK for the VPP, as it joins SolarEdge, GivEnergy, and Enphase as other companies that utilize the Octopus platform for their project operations.
It has been six years since Tesla launched its first VPP, as it started its first in Australia back in 2019. In 2024, Tesla paid out over $10 million to those participating in the program.
Participating in the VPP program that Tesla offers not only provides enrolled individuals with the opportunity to earn money, but it also contributes to grid stabilization by supporting local energy grids.
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