V2G technologies and their income streams mean businesses more than consumers could drive EV adoption. JOHN PARNELL SEPTEMBER 19, 2019, GTM
V2G could mean big money for EV fleet operators. (Shutterstock) 1
Vehicle-to-grid technologies and the income streams they will generate mean businesses — rather than consumers — could become the key driver of EV adoption, according to one U.K. network operator.
Ian Cameron, head of innovation at U.K. Power Networks, said V2G business models could shift the entire makeup of the “electric revolution.”
“V2G technology could potentially be the biggest technological innovation to hit the electricity network since distributed renewable energy became commercially viable,” Cameron said.
“It means millions of mobile energy assets can be deployed in an instant to support local networks and contribute to the national transmission system. It could open up new income streams, not just for drivers, but for fleet operators, energy aggregators and vehicle manufacturers.”
“Much has been made of the rising interest in electric vehicles from consumers, but it could be fleet managers that drive the electric revolution,” added Cameron, who considers V2G the development that seals the deal for a lot of those fleet managers.
Partnerships and dealmaking are picking up in the V2G sector. Nissan and EDF announced this week they will co-develop V2G technology as part of a new agreement in France, Italy, the U.K. and Belgium.
EDF and California-based startup Nuvve launched a V2G joint venture, Dreev, in May of this year, with a focus on business customers and fleet owners. At the time of launch Dreev was targeting several hundred installations before the end of this year.
The pair signed a broader cooperation agreement in the U.K. last year. The initial focus of that was integrating second-life batteries from the Nissan Leaf into EDF’s PowerShift demand-side response platform.
U.K. Power Networks, one of six firms running the U.K.’s 14 regional distribution networks, is running a series of V2G trials. The TransPower projects include a V2G garage for 30 electric London buses, domestic customer trials and a test run with 1,000 fleet vehicles. Electricity supplier OVO, also in collaboration with Nissan, offers a V2G package that can cover all the costs of a customer’s EV charging.
The saturation challenge
The road is not entirely clear for V2G applications in the U.K., however. James Greenleaf, director of energy markets and analytics at the consultancy Baringa Partners, said the proposition for consumers is likely to lose some sparkle as more EVs participate.
“The great offerings available at the moment will fade,” Greenleaf said in an interview. “Initial work suggests that we are looking at consumers replacing 15 to 20 percent of their charging costs rather than 100 percent. That could make them more [hesitant] to hand over control of their charging if they’re not getting such a good deal for it.”
In other words, more V2G participation is a good thing for the electricity system, but it lowers the value per vehicle.
Greenleaf also cited as potential obstacles the additional cost V2G kits add to chargers and the absence of timely, localized price signals to make the most of the flexibility offered by a fleet of distributed batteries. The latter is both a regulatory and a technical challenge.
Broadly speaking, however, Greenleaf considers any tangible progress from the likes of EDF and Nissan a welcome step toward tackling the hurdles that remain.
“Most of these challenges can be overcome, but the decrease in value [for customers] as we put several million EVs on the roads could mean a rethink is required on the commercial model for the aggregators and suppliers, and how the V2G offering is marketed to consumers.”