The Many Benefits of V2G Charging
Much has been made of the potential for electric vehicles (EVs) to save consumers money at the pump. A 2020 Consumer Reports study, for instance, noted that EV drivers spend 60% less on average to fuel their cars than drivers of similar gas-powered vehicles. Over time, these fuel savings offset the already-shrinking premium you have to pay for an EV.
But fuel costs are only one way that EVs can save you money in the long run. Drivers are only beginning to tap into another big benefit: vehicle-to-grid (V2G) charging. A recent report from Fermata Energy, a firm that developed its own V2G technology, one V2G charger can pay for itself in just three years — and earn as much as a $15,000 return over 10 years.
This technology has huge potential upsides not only for EV drivers but also for businesses and even the entire electrical grid. Yet, only a few vehicle manufacturers and utility companies have invested in it so far — and that needs to change. Here’s a look at how V2G works and the ROI it can bring.
What Is Vehicle-to-Grid Charging?
V2G tech is a subset of bidirectional charging technology, which is any type of charging hardware and software that allows an electric vehicle to pass its stored energy to another destination. Some vehicles can pass their charge to another vehicle or appliance, and some can be tapped as backup batteries for your home. V2G technology specifically allows you to pass that energy back to the power grid, usually in exchange for credits against your utility bills.
To pass that electricity back to the grid, you need three things — an EV, a charger, and a utility company — equipped with V2G technology. And our current infrastructure falls short in all three areas.
Thus far, only two cars in the U.S. come equipped with V2G capabilities: the Nissan Leaf and the Ford F-150 Lightning. Other cars include other types of bidirectional charging, and manufacturers like Hyundai are piloting V2G technology overseas, but more companies need to take this important step to make V2G-ready vehicles more widely available.
The chargers themselves aren’t available at scale yet, either, largely due to costs. One U.K. study, for instance, found that a V2G charger costs around £3,700 more than a unidirectional one. That has to come down if consumers will get on board, even with the prospect of long-term savings.
Finally, although more utility companies are offering programs for buying back energy from consumers, many still lag behind. But utilities also stand to benefit from these programs, as we’ll discuss below.
The Many Benefits of V2G Chargers
There’s a reason that many industry pundits are saying V2G is the future of EV charging. It brings major cost-saving benefits, not to mention other advantages, to consumers, businesses, and utilities. Here’s how each stands to benefit from V2G technology.
V2G Benefits for Drivers
Bidirectional charging brings enormous benefits for EV drivers. It makes your car into more than just a car. It’s now a backup power source that can provide energy to your home or important appliances when you need it.
With V2G charging, specifically, your EV becomes a source of income. If your utility offers time-of-use savings programs, for example, you can use your EV strategically to save money on your utilities. By drawing power at lower rates during off-peak times and then selling it back to the utility at a higher rate during off-peak times, you can maximize your ROI on purchasing a V2G charger. Alternatively, you can simply use that off-peak energy to power your home during peak times — either way, you save.
V2G Benefits for Business EV Fleets
Businesses can capture those same cost-saving benefits at a much larger scale. Consider a company with a 100-vehicle fleet, for example. With one charger for every vehicle, that potential 10-year ROI of $15,000 for each charger could turn into $1.5 million in revenue over the next decade.
For a business with a large fleet, V2G chargers can essentially turn a fleet charging site into an enormous revenue-generating power station.
V2G Benefits for the Electrical Grid
V2G charging brings some of the greatest benefits to utility companies. Already managing a strained electrical grid, utilities are using off-peak savings programs to incentivize customers to shift demand to other times of the day or night. V2G charging can take this grid management a step further by creating a virtual power grid from the many connected EVs.
Essentially, when combined with smart charging technology, V2G chargers can be a tool for collaboration between drivers and utility companies to better manage peak demand and draw from excess available power when demand is high. This can smooth out energy fluctuations and create a more stable electrical grid, ultimately making utility companies more efficient and profitable.
Making V2G More Broadly Available
V2G technology represents a critical next step in the evolution of EVs. It puts EVs within reach for many more drivers and fleet managers and offers crucial gird-management capabilities for utility companies. That’s why EV Connect is investing in research and development to improve and expand this important technology.
Through programs like our collaboration to help launch Indiana's first large-scale V2G-capable charging system, EV Connect continues to advance EV charging technology research. To learn more about what we’re doing to make EV technology more effective and available, reach out today.
Sources
Consumer Reports - Electric Vehicle Ownership Costs: Today’s Electric Vehicles Offer Big Savings for Consumers
Green Car Reports - Each EV With V2G Charger Might Earn $15,000 Over 10 Years
Cars.com - What’s Bidirectional Charging and Which EVs Offer It?
Wired - The Future of EV Charging is Bidirectional, If You Can Afford It
U.S. News and World Report - Is Vehicle-to-Grid Charging the Way of the Future?
Zpryme - The Road to V2G