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The Staggering Economics of the Tesla Semi
The Tesla Semi is going to start deliveries this year and there is some staggering economics of how much better it will be than a diesel truck.
Elon Musk has stated that the Tesla semi will start shipping this year and that it will have 500 miles of range. This is after many delays, but Tesla is finally ready to start delivering it to customers. In Elon's Master Plan, Part 2, he made reference to building an electric semi.
The first customer of the Tesla semi is not known to the public yet. Some think it will be PepsiCo because they placed an order for 100 electric semi trucks. Tesla will build out Mega Chargers for the Tesla semi in order to make sure it can charge quickly.
The Economics of the Tesla Semi
If you look at average fuel prices and use the website for U.S. Energy Information Administration (EIA), you can see about how much it costs for a trip for a diesel truck on a highway per gallon of diesel fuel. This ends up being about $4.99.
If you use a distance of 200 miles, you can do a calculation with a miles per gallon around 6 and come up with about 34 gallons (at 5.9 miles per gallon). This is simply for the average diesel truck.
With some simple math, you can take 34 gallons * $4.99, which is $169.76 for the cost of fuel for that diesel truck. This equals about 85 cents per mile. The Tesla semi, which is an electric truck, can take that same load and move it 200 miles. With electricity, you must think about it differently.
We can use a 2 kWh per mile usage for the Tesla Semi even though Tesla says the energy consumption is less than that. This will make calculating more simple. If you take 200 miles * 2 kWh per mile, you get a total of 400 kWh consumed. Tesla can also provide an energy cost of about 7 cents per kWh.
You can then take that 400 kWh * $0.07 per kWh which equals $28 total for the 200 mile drive. This is about 14 cents per mile. With this you get:
* A diesel truck trip at 200 miles is $169.76
* A Tesla semi truck trip at 200 miles is $28.00
This is a savings of about 83% and the Tesla semi will have less wear and tear on its brakes, less maintenance due to having no engine and oil changes, along with being a source of clean energy.
For more information on this, you can see this Tweet thread by Alex Gayer:
The jaw-dropping economics of electric truckingThe retail price of a semi-truck is often discussed when comparing diesel vs. electric, however the potential disparity becomes far less relevant when the economics of operation are concerned.— Al≡x Gay≡r (@alex_gayer) August 11, 2022
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.
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Comments
I do not understand the 7
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I do not understand the 7 cents per kilowatt hour calculation in your article. Where I live, the energy cost runs closer to 30 cents per kilowatt hour. That would still make it a less expensive proposition to fuel, but it is unclear as to the overall cost since I would assume that these vehicles, like most electric vehicles, will cost more than their ICE counterpart. So the overall cost over a typical running life needs to be looked at rather than the running cost at a time when diesel fuel due to government policies has been made artificially expensive.
Residential rates vs
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In reply to I do not understand the 7 by gary (not verified)
Residential rates vs commercial rates are slanderous. Look at the rates for your company and you'll find it. Also for example I'm charged .02 per kW because on a plan from 12am-6am. If I go supercharge. Its silly it's up to .53 on peak hours and .27 on non peak hours.
It's silly how governments
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In reply to Residential rates vs by John (not verified)
It's silly how governments can take way all the blessings that elect vehicles can promise if we were always able to install local solar power to the degree that it would charge battery banks Whenever possible that Would go along way to fulfill the promise of los cost.
Commercial rates
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In reply to I do not understand the 7 by gary (not verified)
Commercial rates
Residential electricity in
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In reply to I do not understand the 7 by gary (not verified)
Residential electricity in the US ranges from 10 cents to 40 cents. Presumably, wholesale rates are lower. Solar generated is even cheaper. This being Tesla I would assume their mega chargers may also take advantage of solar. The deisel government comment is just a non sequitur.
Glad you spoke up
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In reply to Residential electricity in by John Smith (not verified)
Glad you spoke up
Work at a cogen power plant
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In reply to Residential electricity in by John Smith (not verified)
Work at a cogen power plant in northern Canada
National average is like 13
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In reply to Residential electricity in by John Smith (not verified)
National average is like 13 cents.....I pay 9.2...where is it 40? 10 miles from me it's 1.4 cents between 11pm and 7am.
Here in Hawaii, we are on the
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In reply to National average is like 13 by Jelly (not verified)
Here in Hawaii, we are on the cusp of 40 cents per kwh; it's real!
The 7 cents is the number
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In reply to I do not understand the 7 by gary (not verified)
The 7 cents is the number Musk said would be the expected cost per kilowatt at the Tesla charging stations for the semis. So, their electricity cost will be predictable regardless of where they're driving from, through, and to.
7¢ hogwash.
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In reply to The 7 cents is the number by Crash (not verified)
7¢ hogwash.
That's like saying, "I'll lose a little on each sale but make up for it in volume"
Really? If you own a medium
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In reply to 7¢ hogwash. by Matt Fischler (not verified)
Really? If you own a medium sized business anywhere except cali or Hawaii and are paying more than 7 cents/kwh your nuts. 7 cents / kwh here in CO, and less other states. Friends company in washington pays 4 cents /kwh. Your thinking residential rates, which these trucks will never see.
As the saying goes, If its to
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In reply to I do not understand the 7 by gary (not verified)
As the saying goes, If its to good to be true, then mostly it is! These Semi Class 8 tractors are supposely priced less than what it costs to buy just the battery alone. A 550 kWh (300 miles) battery costs substantial over $200,000. Here you get the battery and the truck for $150,000, it just does not pencil.
That battery pencil is way
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In reply to As the saying goes, If its to by Andrew Murchison (not verified)
That battery pencil is way wrong. TESLA has batteries that now cost $80 per KW. That comes out to $40,000 for the battery pack. Also a new battery starts shipping this December that will cut 15 to 30 % off the cost.
I also wonder what that new 30% commercial tax credit (up to $40,000) will do to demand. Also you would not believe the net cost after credit for a CA company.
That battery is nice in a
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In reply to That battery pencil is way by David (not verified)
That battery is nice in a hybrid format yet. The toxicity to make batteries is horrendous,and the demand on the electric grid which is also fossil fuel fed. All of this leads back to Fossil fuel's so beginning production to end of life of both types of vehicles needs more study. Because all eco green formats are absolutely 100% fossil fuel dependant even the back of the Tesla plant is plugged into fossil fuel electrical grid. The green energy concerts have Diesel back up generators and so on it is well known fossil fuel is a no brainer.
Out of all the comments, Mr.
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In reply to That battery is nice in a by Nicholas Lopez (not verified)
Out of all the comments, Mr. Lopez makes the most sense. We have quite a ways to go………
No, not all fossil fuel fed.
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In reply to That battery is nice in a by Nicholas Lopez (not verified)
No, not all fossil fuel fed. Sure US gets 61% of its electricity from fossil fuels but other countries like France are 7% and Canada 18%. So electric trucks will reduce CO2 emissions globally which is what matters cos we all breathe the same air on this planet.
Where did you get that canada
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In reply to No, not all fossil fuel fed. by BioBob (not verified)
Where did you get that canada is only 18% fosil fuel fed??? The national % of green energy in canada is just about the same as USA. 80% coal/oil/gas. And hydro, solar, wind make up 18% 2% is nuclear-powered. The US and Canada just about miror each other in this respect. Dont buy the hype about euro countries "green" renewable sources because they burn wood pelets and call it green energy imported from the US/canada.
So, what is the net cost
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In reply to That battery pencil is way by David (not verified)
So, what is the net cost after credit for a California trucking company buys a Tesla truck correct? Don’t beat around the bush.
Yes.
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In reply to That battery pencil is way by David (not verified)
Yes.
It's gonna be like"free"
And that's not freedumb.
Tesla does not have a battery
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In reply to That battery pencil is way by David (not verified)
Tesla does not have a battery at $80 per kWh, no one does anyone. Battery prices have gone up in the latest survey. And would average 120-130 at a cell level and 150 9dd at a pack level
Tesla 4680 will be more expensive than bought in batteries for a while as it is no where near it technology or performance targets.
Cost of batteries has fallen
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In reply to As the saying goes, If its to by Andrew Murchison (not verified)
Cost of batteries has fallen below $100 per kWh.
And Musk will probably is the LiFePo batteries which are less then the Li-ion batteries. Substantially less. Maybe as low as $50 per kWh.
That puts the semi battery pack at $28k-$56k and falling.
Current internal battery
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In reply to As the saying goes, If its to by Andrew Murchison (not verified)
Current internal battery costs for Tesla is assumed to be around $100 per kWh and are definitely below $150 kWh. That means a 550kWh battery cost's around $55,000
That was before the run up in
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In reply to Current internal battery by Tim (not verified)
That was before the run up in battery material prices. There are actually people in the industry that track this. Battery prices have gone up and LFP batteries more than Lion.
Give em the razor, sell em
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In reply to As the saying goes, If its to by Andrew Murchison (not verified)
Give em the razor, sell em the blades. Printers work that way too. Ink is almost as much as a new printer With ink included. With cost and maintenance of diesel big rigs, it makes sense to change the landscape. Battery powered drills were a joke when they came out... Now they're the standard. Trucks will be the same
I just looked up the average
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In reply to I do not understand the 7 by gary (not verified)
I just looked up the average industrial electricity rate in the US and it's 7.26¢. The average consumer residential rate is 13.72¢. In the Houston area we are currently paying 13.1¢ after renewing our contract at the end of May.
Ummm I literally just googled
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In reply to I just looked up the average by Steve Short (not verified)
Ummm I literally just googled it and average electricity cost in the US is 14.9 cents a kwh on top of that industrial/commerical rates dont apply here, for the owner to benefit from that they would need to plug their truck into the power they have, doing that would take a week to charge the truck. From ive seen everyone ignores that fact, what gets advertised is supercharger times but this isnt the primary method of charging for most teslas. Its either a wall charger that takes 12-24 hours or a level 2 that is 8-12 hours thats for a normal tesla btw the semi has a capacity 5 times greater than than a model s which those times are quoted for. Teslas solution for the semi is qhen its charged at a supercharger it uses 4 charging heads, which requires a supercharger which charges 4x the normal rate. Even if they spend a ton of money getting them installed wherever the trucks are houses out of that doesn't cover all the trucks needs especially with fluctuations in load and temp. Reality is electric vehicles are a gimmick and will continue to be so until reliable solid state batterys happen. Oh and if you look up the studys the only time the truck is cleaner than a diesel is if at least 60% of its electricity usage is generated by renewable or nuclear energy. There are some places that is possible, mostly along the west coast. The national average is 39% which when factoring in the additional carbon footprint of a electric vehicle(the battery has the same carbon footprint of the entire rest of the vehicle combined, making the entire vehicle generates twice the carbon footprint of a ice vehicle) they will never even break even for most of the country. Finally most of the studys compare to a flat 25% ICE efficiency, with no higher efficiency comparison for a diesel. Ice havnt been that inefficient since the 90s and diesels have been more efficient than gas engines since the 80s. Your average engine nowadays is 35% efficient with the peak being over 40%(Toyota had hit 42% but not sure if they made it to their 45% goal yet) while diesels now average 46% while some research models are nearing 60%. Teslas vehicles are 85% efficient by teslas admission, coal power generation 33% for a total efficiency of 28% for any coal generated electricity and natural gas is on average 42% efficient(some newer combined cycle plants hit 60%) for a total efficiency of 36% for natural gas generated electricity(51% if you happen to use electricity from a combined cycle plant which would be better but there's only a handful of those plants, and again mostly west coast)
Not to mention that…
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In reply to Ummm I literally just googled by jeremiah kenne… (not verified)
Not to mention that batteries don't have eternal lives. This analysis does not take into account the economic and environmental effects of dealing with the incredibly toxic composition of the batteries and how they will be disposed of when a car is totalled or the battery has reached it's end of life.
i agree. there would seem to
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In reply to I do not understand the 7 by gary (not verified)
i agree. there would seem to be advantages of electric over diesel heavy trucking but the cost of electricity assumed looks understated and the cost of diesel has spiked as you say mostly because of government interference in energy markets
a real comparison would use the present value of all future costs of ownership, including depreciation and maintenance. electric and fuel cost would have to be explained and projected to a range
I'm not sure id call diesel
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In reply to I do not understand the 7 by gary (not verified)
I'm not sure id call diesel artificially expensive. Its a global market and it's heavily disrupted at the moment. That said, 7c a kwh is amazingly cheap. Mine is slightly below national average and its 10-11c per kwh. Figure trucking companies will get bulk discounts or off-peak discounts and you still have to add some infrastructure markup (even if the semi only charges at home-base at raw elec prices you still need to figure the charging infrastructure installation).
All that said, a model 3 or model Y is a massive savings over a similarly equipped gas car right now. If you compare them to their market equivalents they sit at nearly the same prices (50-65k$) and cost vastly less per mile to drive. If your in the market for a 50k$ luxury sedan or a 60-65k$ SUV then buying a gas car will cost you 25-35k$ extra over the life of the car (150-200k miles) just for fuel!!
The charging infrastructure for the semis should be fairly straightforward to setup because they tend to have specific routes. Putting superchargers along those routes at specific intervals will easily service the trucking industry (we wont need stations on every block like we have with gas cars at the moment).
I think our biggest problem for the next decade will be lowering the price on the batteries and making enough of them quickly enough. Even with passenger cars we are talking about 1 ton of batteries for every 2 cars. Just replacing 10% of new cars sold in the USA will require a million pounds of batteries every year. Replacing 10% of new cars with EVs will require 10 times as many as tesla is making per year currently (if all those sold were teslas).
I dont think ill likely own another gas vehicle at this point. Most of my yard equipment is electric now and its just better. I expect our next vehicle to be a model 3 or Y (unless another manufacturer really pulls a rabbit out of a hat in the next 12-24 months).