Fleet Electric Vehicle Total Cost of Ownership with and without Federal Tax Credits

An updated RMI analysis comparing the total cost of ownership (TCO) of electric vehicles (EVs) versus fossil fuel vehicles across various fleet applications, highlighting the impact of federal tax credits and fuel prices.

• Electric paratransit vehicles maintain a lower total cost of ownership (TCO) than fossil fuel equivalents across all modeled fuel prices, regardless of whether federal tax credits are applied. However, this advantage decreases if the vehicle travels significantly less than the modeled 22,500 miles per year.
• For patrol cars and private security vehicles, federal tax credits make electric vehicles more economical than fossil fuel versions, with the economic advantage increasing as fuel prices rise. Without these credits, the TCO for electric patrol cars is higher unless fuel prices exceed $3.75/gallon.
• Electric vehicles for construction contractors and large medium-duty delivery businesses generally have a higher TCO than fossil fuel vehicles. For construction vehicles, tax credits only make them competitive when fuel reaches $3.75/gallon; for delivery vehicles, tax credits bring them close to parity at $3.75/gallon for diesel, though this is considered conservative as it excludes diesel emission fluid costs.

APA

RMI (2025). Fleet Electric Vehicle Total Cost of Ownership with and without Federal Tax Credits. https://rmi.org/resources/fleet-electric-vehicle-total-cost-of-ownership-with-and-without-federal-tax-credits/

Chicago

RMI. Fleet Electric Vehicle Total Cost of Ownership with and without Federal Tax Credits. 2025. https://rmi.org/resources/fleet-electric-vehicle-total-cost-of-ownership-with-and-without-federal-tax-credits/.

Wikipedia

{{cite report |author=RMI |title=Fleet Electric Vehicle Total Cost of Ownership with and without Federal Tax Credits |date=24 February 2025 |url=https://rmi.org/resources/fleet-electric-vehicle-total-cost-of-ownership-with-and-without-federal-tax-credits/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{rmi2025fleet, author = {{RMI}}, title = {{Fleet Electric Vehicle Total Cost of Ownership with and without Federal Tax Credits}}, institution = {RMI}, year = {2025}, month = feb, url = {https://rmi.org/resources/fleet-electric-vehicle-total-cost-of-ownership-with-and-without-federal-tax-credits/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }