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Vehicle to Grid (V2G) - Great, but is it viable?

Posted January 18, 2018 by Roseanne

The concept of V2G is to enable EV drivers to provide their stored battery energy back to the grid at times of high demand, potentially earning themselves a nice little sum.

At Pod Point, we recognise charging infrastructure has a role to play in mitigating potential grid impacts from the mass adoption of electric vehicles. We also recognise that while there are challenges, there are great opportunities.

One such opportunity is for electricity customers to move from the role of energy consumer to a hybrid of energy consumer, energy storer and even energy provider.

Great, right? Yes! In theory...

V2G is a hot topic in the EV industry and the benefits are frequently discussed. Now we’re not trying to be party poopers, but we thought we’d give our take on the constraints that are often overlooked…

Concerns

1. Implementation costs: The hardware required to support V2G system will make the charging systems more expensive. These costs could outweigh the financial benefits to the consumer, or at least make the payback period prohibitively lengthy.

On the other hand, V2G hardware costs are currently much lower than installing the alternative system, i.e. a fixed battery (e.g. a Tesla power wall) and this one of V2Gs key strengths. Though costs are falling fast, batteries are expensive. If you can use the one you’ve already paid for in your EV, then you can reduce your spend.

2. Standardisation: Currently only the “CHAdeMO” DC connector is capable of V2G, it’s not currently used in homes and it is not by any means a universal connector. If V2G technology becomes viable in the mainstream, there would need to be agreed standards between various OEMs. This consensus will be challenging to establish.

3. Increased battery degradation: Should a customer use their battery as both a recipient and provider of grid power, this will increase the duty cycle and may impact the viable life of the battery. This could cause the range of the vehicle to reduce sooner and negatively impact its residual value.

Pod Point notes recent research stating that use of the battery for V2G could actually improve battery longevity, by ensuring the battery is kept in optimal state (e.g. not sat “over-charged” for extended which can harm the battery). We are yet to fully understand how practical this battery life optimising V2G approach is and whether/how much it constrains the opportunities for usage - but there’s no doubt it is potentially a big positive for V2G.

4. Intermittent availability of EV as power source: The car will frequently be in use on the roads at the times when it would provide the chance for customer to make some money.

5. Alternative ways to gain benefits: Simply using high powered devices (e.g. washing machines, dryers, charging EVs) at night will provide savings in a similar way, with no significant implementation costs. Having a fixed battery at the home will provide all the proposed benefits of the V2G system with none of the systematic constraints – and the cost of these systems is reducing fast.

Summary

Many of the benefits for a customer to use a V2G system can be achieved with established and available load management systems, especially when combined with fixed domestic battery storage.

There are established battery systems on the market that already meet the fundamental requirements of battery storage that could always be available at a similar cost.

The complexities of the electricity supply industry would further complicate the take up and use of such a system.

Written by James McKemey, Head of our Insights Team.