The Tool Desk
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What belongs in a diesel-to-electric cost estimate?
A useful comparison is a project-specific total cost of ownership (TCO) estimate, not a comparison of sticker prices or fuel bills alone. It asks what each option will cost to acquire, operate and retire while doing equivalent work over a defined period. Use the same ownership horizon, workload and output assumptions for both machines; otherwise, the lower total may simply reflect less work being done.
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The U.S. Department of Energy’s 2024 off-road assessment distinguishes two questions: “Total cost of ownership analysis can help to identify when and where reductions in operating costs can offset increased capital costs, whereas life cycle analysis (LCA) can identify the total GHG emissions impact.” TCO is the method for estimating costs. A life-cycle assessment examines greenhouse-gas impacts; a lower operating cost alone does not establish the total emissions result. Read the DOE off-road equipment assessment.
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Build the estimate from costs that apply to your project. The U.S. DOE Federal Energy Management Program’s general life-cycle guidance includes equipment and installation, energy, maintenance, repair or replacement, and disposal. Those categories are useful for a contractor’s analysis, but the federal guidance is not a legal or purchasing requirement for private contractors. DOE FEMP’s life-cycle-cost guidance also identifies operating hours, energy prices, product lifetime and discount factors as inputs when evaluating lifetime cost.
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| Cost category | Diesel machine | Electric machine |
|---|---|---|
| Acquisition | Machine price and any delivery or commissioning costs not included in the quote. | Machine price and any delivery or commissioning costs not included in the quote. |
| Site and energy supply | Fuel supply arrangements or site equipment costs that apply. | Chargers, electrical service upgrades, trenching or conduit, commissioning and other required site work; electricity under the applicable utility rate. |
| Operating and upkeep | Fuel, maintenance, repairs, replacements and relevant downtime. | Electricity, maintenance, repairs, replacements, charging-station service or software if applicable, and relevant downtime. |
| Ownership and retirement | Financing or other ownership costs, residual value and end-of-life costs. | Financing or other ownership costs, residual value and end-of-life costs. |
Include an item in only one place. For example, do not separately add maintenance that is already included in a service plan, and do not subtract an incentive twice if it is already reflected in the quoted purchase price.
How to build a project-specific estimate
Work through the comparison in order. Keep the source of each input—such as a fuel receipt, supplier quote or utility estimate—with the number, and record the assumptions that are not yet confirmed.
- Define the job and comparison period. Choose a particular machine class and the work it must perform. Set the ownership horizon and define comparable output, shifts and annual operating hours for both options. If one machine cannot meet the production requirement or work pattern, it is not a like-for-like alternative, regardless of its quoted price.
- Measure the diesel machine’s real use. Gather fuel receipts or telematics, annual hours, idle time, workload, travel between sites and shift schedules. Use delivered diesel prices relevant to the project period, rather than a generic price or a single tank fill. Note whether fuel use includes idling or travel that the electric machine would also need to handle.
- Ask the electric supplier for duty-cycle evidence. Request expected energy use for the relevant workload, charging duration, battery or charging requirements, operating limits and any relevant assumptions behind the estimate. Confirm whether the machine can meet the required shift and workload, including travel, breaks and periods when charging is possible. DOE describes smaller battery-electric off-road machines as a current area of use and says they may support up to eight hours of workday operation depending on duty cycle. That is a report-level observation, not a runtime guarantee for a particular machine or a specification for every equipment class.
- Price the installed charging plan. Get separate quotes for the machine and the equipment and work needed to charge it. Ask the utility whether the site can provide the required power, what upgrades may be needed and which rate structure would apply. Ask the site contractor to itemize chargers, electrical service work, trenching or conduit, commissioning and other site costs rather than treating the charger’s equipment price as the whole installation cost. If the machine moves between sites, establish how each site will be supplied; a charging plan for one depot may not work for a remote job.
- Calculate annual operating and upkeep costs. For diesel, multiply actual fuel consumption by the delivered fuel price for the period being modeled. For electric, use measured or vendor-estimated energy demand and the applicable electricity tariff. Add maintenance, repairs and replacement costs for both machines, plus charging-station service or software charges when relevant. Include the cost of downtime where it affects production, labor or the ability to meet a schedule.
- Set ownership and end-of-life assumptions. Record financing costs or the discount rate used for a present-value comparison, expected useful life, replacement timing and residual value. Add applicable disposal costs. Use the same approach for both options and state assumptions that are estimates rather than contracted terms.
- Check local programs and utility terms before deciding. Ask the utility about the site’s rate and any relevant programs, then verify eligibility directly with the program administrator in the project’s jurisdiction. Incentives, utility rates and programs can change; do not count a grant, credit or rebate until its applicability to the equipment, buyer and location is confirmed.
How to calculate lifetime cost and compare the options
For a simple undiscounted comparison, add the costs expected over the chosen period:
Electric lifetime cost = equipment + charging and site installation + electricity + maintenance, repairs and replacements + financing or other ownership costs + end-of-life costs.
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Diesel lifetime cost = equipment + fuel + maintenance, repairs and replacements + financing or other ownership costs + end-of-life costs.
Subtract the diesel total from the electric total to show the modeled difference. A positive or negative result is meaningful only with the period and assumptions beside it. If the decision horizon warrants it, calculate discounted present value: later costs are converted to today’s value using a stated discount rate. Apply the same method and timing assumptions to both alternatives. A spreadsheet can keep the inputs auditable, but no particular calculator or generic template can substitute for project quotes and operating records.
It can also help to divide annual costs by productive operating hours or by a defined unit of work, provided both machines are assessed on the same basis. This makes it easier to see whether an apparent saving depends on running more hours, producing more output or avoiding downtime. Do not use a per-hour figure that silently excludes installation, repair, financing or other costs included in the lifetime comparison.
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Run a lower and higher case for the inputs most likely to change the result: annual operating hours, energy and diesel prices, charging downtime, and charger or site-work estimates. Use realistic ranges grounded in your records, quotes or utility information, and label them as assumptions. If a decision changes between cases, identify which input drives the change; that is more useful than presenting one payback period as assured.
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Higher utilization can help spread an electric machine’s higher initial capital cost across more work, but DOE does not establish a numerical annual-hours threshold at which a switch pays back. A payback calculation is therefore a result of your inputs, not a general promise. If calculating it, show the initial additional outlay, the modeled recurring savings, the period and the assumptions. Do not describe it as guaranteed unless the project’s costs and operating conditions actually support that conclusion.
Why charging access and machine use can change the result
Off-road equipment covers varied machine types, uses, operating environments and regions. In its assessment, DOE identifies cost, machine weight, charging downtime and infrastructure as barriers. Those considerations are screening questions for each machine and site—not grounds to assume that every electric machine is uneconomic.
Match the duty cycle to charging opportunities
A supplier’s runtime estimate matters only if it reflects the work you need done. Compare expected energy use and charging duration against actual shift length, workload and available charging windows. Charging during a shift may affect production time; charging after a shift may depend on the machine returning to an equipped site. Include the value of lost productive time if the schedule or workload makes it material. DOE notes that battery-electric off-road equipment is better suited to duty cycles and recharge opportunities that fit the application.
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A remote job may not have charging infrastructure. DOE notes that some remote applications may need energy transported to, or generated where, equipment operates. Ask how the proposed charging arrangement would work at each site and include its costs and practical limits. At a fixed site, confirm power availability and the utility’s applicable rate structure rather than assuming that the machine’s quoted energy use translates directly into a known bill.
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Charging cost depends on site conditions, configuration and installation. The DOE Alternative Fuels Data Center’s Electric School Bus Planning Guide discusses these variables and recommends checking utility rates and programs. It is a bus-focused planning resource, not a source of construction-equipment installation prices or a determination of contractor eligibility. Use its categories as questions to take to a utility and installer, not as bids for a construction site.
| AFDC bus-depot planning example | Guide’s charger equipment-and-installation estimate |
|---|---|
| 10 kW | $11,000 per bus |
| 17 kW | $14,000 per bus |
| 25 kW | $27,000 per bus |
| 33 kW | $34,000 per bus |
These are electric school-bus planning figures, not contractor estimates; they should not be inserted into an off-road equipment budget as if they priced a construction installation. The same guide says station operators generally use 10% of upfront cost to estimate annual station maintenance and illustrates that with a $20,000 station and $2,000 in annual maintenance. Those figures, too, describe the guide’s bus-planning context; obtain a service or maintenance estimate for the charging equipment and site under consideration.
Account for weight, transport and worksite limits
DOE identifies battery weight as a factor that may affect transport or soil compaction for some equipment. Check transport requirements and ground conditions for the specific machine rather than assuming the battery has no operational consequence. Also verify the machine’s operating limits against the actual work environment. If the electric option cannot perform the required work, or a practical charging plan cannot support it, a favorable energy-cost estimate alone is not enough to make the comparison viable.
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The cited official sources do not establish a current purchase price for switching contractors’ off-road diesel equipment, a contractor-specific tariff, a local diesel price, charger installation bids, financing terms, residual values, applicable local incentives or a general payback period. Those figures must come from the equipment and site being evaluated. The DOE assessment’s “up to eight hours” observation applies broadly to smaller equipment categories and varies with duty cycle; it is not a quote or a savings statistic.
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The bus-guide examples demonstrate that charging configuration and installation can vary, but they are not a proxy for a construction-equipment project. Treat the project’s equipment quotes, utility response, site-work bids and operating records as the basis for its estimate, and date those inputs so the comparison can be revisited if prices or plans change.
How to read the result before committing
Review the estimate first for feasibility, then for cost. Confirm that the electric machine can meet the work requirement and that charging is available when and where needed. Then check whether the conclusion holds across reasonable high- and low-use, energy-price and infrastructure cases. If it does not, use the sensitivity results to identify which facts need firmer quotes or a revised operating plan before making a commitment.
A defensible estimate is not a universal electric-versus-diesel verdict. It is a transparent comparison tied to a particular machine, duty cycle, site and time horizon, with confirmed costs separated from assumptions.
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