How is V2G Transforming the Future of the Electric Grid?

You may have come across the term V2G (vehicle-to-grid) in relation to electric vehicle (EV) charging. Maybe you’re not sure exactly what it is and how it works.

In this article, we’ll provide all the details you need to know about V2G, including the benefits of applying it, and what the future is likely to hold for V2G technology.‍

What is Vehicle-to-grid (V2G)?

To put it in simple terms, V2G is a connection between an electric vehicle and the power grid that enables a two-way flow, either charging the vehicle from the grid or discharging the vehicle to feed power back into the grid.

The decision on whether to charge or discharge the vehicle is made based on the level of charge in the vehicle and market signals from the grid. In other words, during periods of high electricity demand, the grid may draw power from vehicles if there is enough available and recharge the vehicle when demand is lower and the price is cheaper.

The energy provider (or utility company) offers special V2G programs that customers can opt-in to, allowing the customer to define the amount of energy they are happy to send back to the grid when needed. It gives the customer the opportunity to cut the cost of charging their vehicle, while also helping the grid to meet peak demand.

The most recent projections predict that the V2G market will be worth $28.12 billion by 2026, so it is a growing technology that is here to stay, at least for the foreseeable future.

Is V2G possible and available today?

At the moment, it is still an emerging technology. It is currently undergoing thorough testing and trials to make sure that it is viable and functional over the long term. There are currently less than 100 projects actively using V2G events in the world.

However, the early signs are that V2G is viable and will become widely adopted over the next couple of years. For instance, a recent whitepaper report from Nissan and London’s Imperial College revealed that their trials of bi-directional V2G charging have been successful and there could be major benefits including reducing carbon emissions by 60 tonnes per year, per EV, and cutting fleet charging costs by up to £1250 per vehicle.‍

What are the challenges of using V2G?

  • Poor Infrastructure: One of the main challenges when it comes to implementing V2G is not the technology itself, but the infrastructure it interacts with. In many cases, there is poor existing infrastructure and the current grid conditions make it difficult for vehicles to push energy back into the electric grid successfully.
  • Grid Congestion: The electric grid may be heavily used, causing congestion problems which lead to instability and a large amount of energy loss.
  • Grid Volatility: As energy is increasingly generated from renewable sources, although great for the environment, it can cause instability in the grid. For instance, solar and wind power can fluctuate depending on weather conditions. It is expected that by 2050, 62% of energy will be generated by renewables, which means greater grid volatility and unpredictable demand. V2G can actually help to alleviate this problem, as we’ll discuss in a moment.
  • Extreme Weather: Extreme weather such as heat spikes or cold snaps can cause a surge in electricity use to power air conditioners or electric heaters. Climate change is causing extreme fluctuation in temperatures which is leading to more grid congestion, which is a problem for V2G.‍

What are the main benefits of using V2G?

Partly due to the challenges listed above, we are not seeing too many charging station manufacturers releasing V2G chargers. The V2G hardware that has been developed is not being used at scale. However, due to the benefits listed below, we expect this situation to change over the next two years as manufacturers bring new products to market.

  • Grid Stability: In contrast to the grid volatility mentioned above, V2G can actually help to create more stability in the grid by helping power suppliers to react to grid constraints and sudden changes in energy supply or demand.
  • Renewable Energy Generation and Storage: V2G represents a storage opportunity for cheap renewable energy. Energy can be generated during the day or night and fed back into the grid during peak periods. This creates more grid stability by balancing supply and demand. For example, imagine a site that is constantly generating and saving solar energy during the day. At 1 pm there is a sudden spike in demand. The site receives a V2G signal and supplies solar energy into the grid. In this case, the site could also choose to use the available solar energy instead of other non-renewable sources for their operations, thereby utilizing carbon-zero energy.
  • Providing Backup Power: When demand peaks for electricity, fleet operators can access the power stored in the batteries of electric vehicles. For instance, a fleet of school buses is perfect for V2G backup energy as they are only used at specific times, usually from 6am to 9am and 3pm to 5pm. For the remainder of the time, the buses are dwelling at the depot and can push energy back into the grid and recharge when demand and energy prices have reduced.‍

Other types of V2G

V2G technology is not limited to vehicle-to-grid relationships. Other types of V2G systems include:

  • V2B: Also known as Vehicle-to-Building, V2B involves a vehicle/charger sending energy directly to a building.
  • V2H: Also known as Vehicle-to-Home, V2H involves a bidirectional EV charger being used to supply power (electricity) from an EV Car’s battery to a house.
  • V2X: Also known as Vehicle-to-Everything, V2E is a communication system that allows vehicles to communicate with other vehicles and the infrastructure around them.‍

What are the benefits of V2G for charging station owners and drivers?

For individual EV owners, if their utility provider has V2G or DR (Demand Response) programs, they can opt-in, enabling the car’s V2G capability to be activated during peak demand hours. In this case, the vehicle owner receives payment for any energy supplied to the grid. In other words, the owner is literally making money from their parked vehicle.

If the utility company is not able to provide this service, the vehicle owner can use V2H which supplies energy to their home, allowing them to cut their energy bills by reusing available energy stored in their vehicle or vehicles.

For grid operators, let’s say a utility company, V2G events can be used to prevent grid congestion, volatility, and energy imbalances, using the demand and supply of energy as a guide. Utilities can also provide carbon-zero energy when choosing to use available renewable energy, instead of more reliable fuel energy.

The Department of Defense calculated the financial benefits a few years ago. The calculation shows a possible return of around $170/kW per year from V2G. If you use a 15 kW charger, you could receive approximately $2,520 per year by providing V2G capability. The good news is that the charging station owner receives these returns even if no V2G had been requested during the period. You get paid simply by “being available in any case”.

NREL refers to other research studies from 2016 that show a possible net return of $17,384 for school bus fleets and $6,170 for transit buses.‍

How can we implement V2G?

V2G needs a variety of technologies in order to work.

  1. V2G needs an electric vehicle that is capable of bi-directional charging. In other words, the electric vehicle must be able to both receive and send energy. Many of the big vehicle manufacturers are developing and implementing this technology today.
  2. V2G-enabled EV charging hardware needs to be in place. EV charger manufacturers need to implement the required protocol for V2G events: IEEE 2030.5. With a universal protocol, vehicles, chargers, and utility companies can communicate with each other seamlessly, enabling the sending and receiving of the information needed for a V2G event (energy demand, energy supply, grid imbalance, etc.)
  3. Electric vehicle chargers need to be able to automate these signals. This means it is in need of EV charging management service, in other words, smart charging technology. Smart Charging is a process that automates and optimizes decisions while an EV is charging. Optimized charging includes the following aims:
  • Reduce total peak demand at the charging location
  • Avoid high energy costs for both driver and charging point operator
  • Ensure on-time departures and a sufficient level of charge for each vehicle
  • Help to stabilize real-time energy markets and electric utility services.

At Ampcontrol, we use smart charging technology to optimize V2G events, while also optimizing energy costs, on-time departure, and grid stability. With smart charging, we are able to access and analyze the data points needed for V2G events to see whether it is possible in comparison to other goals, such as having enough energy for your next trip.‍

The Future of V2G

The energy market is constantly growing and evolving. The electric grid will have to adapt to the growing number of EVs and demand for fleet electrification. Some of the potential consequences may be:

  • More dynamic energy markets: Different energy pricing structures are already in use around the world. In the US, specifically in California, we can see utilities implement TOU rates as an incentive for companies to use less energy during peak demand periods of the day. But there are even more dynamic pricing structures, such as Spot Pricing, which is being used in Norway. Spot pricing helps to cope with the unreliable supply of renewable energy by shifting prices hourly depending on the available energy. Dynamic pricing can have a massive impact on overall energy costs. V2G would balance out this unstable pricing by supplying energy when demand is at its peak. This would balance prices, and reduce pricing spikes throughout the day.
  • High vehicle load: Vehicle load is much larger than typical household energy usage but fairly small compared to other conventional energy users, such as industrial manufacturing plants or large cooling houses. Experts agree that scaling electric vehicles only works with V1G (Smart Charging) and V2G. Without V1G and V2G, utilities and grid operators face considerable challenges to get charging station locations approved. The risk is that they create an energy market where energy generation is dependent on weather conditions and our vehicles are not smart enough to react to price signals or utility emergency requests.‍

Conclusion

V2G stands for vehicle-to-grid and it’s a system that enables the flow of energy from and to the grid.

V2G offers many benefits such as grid stability for utility companies and reduced energy bills for EV owners and fleet operators. However, there are some potential obstacles such as poor grid infrastructure and the potential for grid congestion.

Smart charging technology such as Ampcontrol software offers one of the most effective ways to deal with the challenges faced when implementing V2G as it analyzes charging data and helps to pinpoint the best and most cost-effective opportunities to charge the EV and when to push energy back into the grid.

To find out more, get in touch with one of our smart charging experts today.

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Founder and CEO of Ampcontrol (https://www.ampcontrol.io/) an AI-powered software for smart charging for electric vehicles.

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Joachim Lohse (CEO and founder of Ampcontrol.io)

Joachim Lohse (CEO and founder of Ampcontrol.io)

Founder and CEO of Ampcontrol (https://www.ampcontrol.io/) an AI-powered software for smart charging for electric vehicles.

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