Electric or Hybrid Cars: Which is the Better Investment?

When it comes to making a smart investment, electric vehicles (EVs) are the clear winner. Learn about federal and state incentives for EVs and PHEVs, plus how they compare in terms of purchase price, range, refueling costs, maintenance and experience.

Electric or Hybrid Cars: Which is the Better Investment?

When it comes to making a smart investment, electric vehicles (EVs) are the clear winner. They have lower net emissions, require less maintenance, and are more fun to drive. Plus, there are federal and state incentives that come with purchasing an electric or hybrid car. Rebates and incentives for electric and hybrid vehicles vary from state to state, so it's important to stay up-to-date on the current options available.

For drivers who make shorter trips, an EV may be the best choice. However, for those who have a longer commute or take road trips, a plug-in hybrid car (PHEV) may be a better option. PHEVs generally have larger electric batteries than standard hybrids, with the ability to drive on electric power alone. Unlike plug-in and fully electric hybrid vehicles, hybrids are not eligible for federal tax credits.

A hybrid vehicle is more effective at saving money when the trip is short, and you can rely on the small electric battery for most of the driving time. Hybrid cars are a combination of two types of cars: electric cars and traditional cars that run on gasoline (ICE). Standard hybrids use regenerative braking and the ICE to charge a battery pack, providing supplemental electrical energy. Many hybrids only automatically derive energy from the electric motor below certain speeds, so they tend to be much more efficient under city driving conditions.

A hybrid works with an ICE and an electric motor, with separate batteries for each. Unlike traditional ICEs, EVs don't require you to pay for a full tank of gas every time the electric battery is “full” - instead, it is added to your home's electricity bill with a plug-in charger. Maintenance costs for hybrids may not be as high as traditional ICEs, but they will still end up costing more than an EV. Another type of car, the fuel cell electric vehicle (FCEV), is powered by an electric motor but uses a hydrogen-powered fuel cell.

Electricity comes from many generating sources, from the burning of fossil fuels to renewable sources such as solar, wind and hydroelectric energy. EVs tend to have dynamic performance since an electric motor delivers 100 percent of its available torque instantly. Plug-in hybrids can have mechanical problems that can be seen in both electrical cards and their ICE counterparts, although less frequently if the engine is not used as much. Hybrid and electric vehicles use electric car batteries that will eventually have to be discarded, and we do not yet fully understand the environmental impact of this.