Department of Energy

eGallon: What It Is and Why It’s Important

June 10, 2013

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For most drivers, a trip to the fuel pump is an easy reminder of the day-to-day cost of gasoline or diesel. But for electric vehicle (EV) drivers, who typically charge their car at home, there isn’t a similar measurement to determine the cost of driving on electricity. To help both current and potential EV drivers better understand the cost of driving an EV, the Energy Department created the eGallon.

What is the eGallon?

The eGallon represents the cost of fueling a vehicle with electricity compared to a similar vehicle that runs on gasoline. For example, if gasoline costs $3.60 a gallon in your state and the eGallon price for your state is $1.20, that means that for $1.20 worth of electricity you can drive the same distance as you would for $3.60 worth of gasoline.

How is eGallon calculated?

To determine the eGallon price for each state, the Department of Energy calculates how much electricity the most popular electric vehicles would require to travel the same distance as similar models of gasoline-fueled vehicles would travel on a gallon of gasoline. That amount of electricity is then multiplied by the average cost of electricity for the state. This gives consumers a clear comparison of the cost of driving on electricity vs. a similar sized car that uses gasoline. 

For more on how eGallon is calculated, download the eGallon methodology.

Why do gasoline prices swing so wildly? Does the same thing happen with eGallon prices?

Gasoline prices are tied to the global oil market, which is driven by international events that are difficult to predict, control or prepare for. Unrest in an oil producing country on the other side of the world can drive up the price of gasoline in your neighborhood, seemingly overnight. 

In contrast, the price of electricity is determined by local markets or state utility commissions. This means that electricity prices tend to be very stable over time -- creating a lot less uncertainty about fuel costs for an electric vehicle. The chart below shows how the prices of gasoline (the green line) and electricity (the blue line) have fluctuated over the past 10 years.

Why does the price of an eGallon vary by state?

Just like the price of gasoline, the average electricity price is different for each state. Electricity is generally produced close to its customer base, and different regions have different regulations and resources (e.g. coal, natural gas, wind, etc.) that affect the cost of electricity production. Traditionally, the cheapest way to produce electricity is through “mass production” -- at a large scale. So each region may have only one electricity company. Local governments work with this company to set a price for electricity that is reasonable for consumers. In many places across the U.S., electricity prices are set by regulators, not the market.

How does “off-peak” charging affect the eGallon price?

In some places consumers are charged “off-peak” rates for fueling their electric vehicles at night when electricity demand is low. This “off-peak” electricity rate leads to even bigger cost savings for driving on electricity. The eGallon is based on the average cost of electricity for residential consumers.

Why do we need eGallon?

The cost of driving an EV depends on the cost of electricity, which is measured in kilowatt hours. Yet, when consumers think of the cost of driving, it is usually determined by the price of a gallon of fuel. The eGallon provides a metric that is easily comparable to the traditional gallon of unleaded fuel -- the dominant fuel choice for vehicles in the U.S. 

How is eGallon related to the EPA’s MPGe rating?

eGallon and MPGe are not related. eGallon is a measurement of the cost to drive a comparable vehicle the same distance you could go on a gallon of gasoline. MPGe is a measurement of how efficiently a vehicle uses energy based on the number of British Thermal Units (BTUs) in the fuel.

How often is the eGallon price updated? What about the gasoline prices listed with eGallon? will release the state and national averages for eGallon in coordination with the Energy Information Administration’s (EIA) monthly reports on electricity prices. The eGallon price is calculated using the most recently available state-by-state residential electricity prices. The state gasoline price above is either the statewide average retail price or a multi-state regional average price reported by EIA. The latest gasoline pricing data is available on EIA’s webpage.