Is vehicle-to-everything’ charging ready for prime time?

Bidirectional charging could provide home backup power, stabilize the grid and decrease costs for EV owners. A new consortium aims to make it mainstream.
By Jeff St. John

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A Nissan Leaf plugged into a Fermata bidirectional charger
A Nissan Leaf plugged into a Fermata bidirectional charger at the Southern California site of DOE’s "vehicle-to-everything" announcement last week. (Harvey Farr Photography)

How much more valuable can electric vehicles be if their batteries can be tapped to power homes, other buildings or the grid at large? And are those extra benefits worth the costs and complications of getting the technologies and policies in place to make EV bidirectional charging possible at large scale?

The U.S. Department of Energy appears to think this vehicle-to-everything” (V2X) capability is well worth the effort. Last week, it launched a collaboration with automakers Ford and General Motors, vehicle-to-grid charging companies including Fermata Energy and Nuvve Holding Corp., and California’s biggest utilities and energy regulatory agencies to test and validate the commercial viability of technologies that can make it happen.

The DOE’s Vehicle-to-Everything Memorandum of Understanding also includes commitments from electrician unions and contractors to train workers to install V2X systems, as well as support from DOE’s national laboratories to test charging equipment and software with cybersecurity as a core component.”

Integrating charging technology that powers vehicles and simultaneously pushes energy back into the electrical grid is a win-win for the future of clean transportation and our energy resilience overall,” Deputy Secretary of Energy Dave Turk said at last week’s event at an electrician training site in Commerce, California.

V2X is far from a new concept. Vehicle-to-grid (V2G) pilots have been running for more than a decade in the U.S. Europe has multiple EV fleets providing V2G services to utilities and grid operators, and Japan has enabled bidirectional vehicle-to-home and vehicle-to-building charging in the years since its 2011 Fukushima nuclear power plant disaster.

Until recently, however, it hasn’t been clear whether major automakers, manufacturers of EV-charging equipment, utilities and state energy regulators were ready to take the next steps from pilot projects to enabling mass-market adoption. Automakers have worried about the risk of bidirectional charging causing harm to expensive EV batteries and disappointing EV customers. Utilities and regulators have struggled with creating rules to ensure safe and reliable interconnection and operation of this two-way flow of electricity. EV-charging companies have been loath to embed bidirectional capability in equipment without a clear market demand for it.

But now that EVs have expanded beyond a niche market and are expected to make up a majority of vehicle models and sales in the coming years, hesitations and hurdles are starting to disappear, according to Clifford Rechtschaffen, commissioner with the California Public Utilities Commission.

We’ve been hearing for a long time that vehicle-to-grid bidirectional charging is the next big thing [and] it’s going to be here in a year or two. Well, it’s finally here,” Rechtschaffen said in a phone interview from last week’s DOE event.

The automakers have largely embraced the technology and recognized it’s an integral part of their future. You only have to look at the way Ford is marketing the F-150 Lightning,” its forthcoming electric pickup truck that comes with the promise of providing home backup power. Other automakers including GM, BMW, Volkswagen and Hyundai are also touting the ability of their EVs to power homes, while Nissan’s Leaf EVs have been capable of bidirectional charging for years.

That automaker buy-in is an important first step toward allowing California and other states to unlock the range of values that thousands or millions of EV batteries can deliver, according to Rechtschaffen. V2X does things that no other asset we have does,” he said.

It can provide backup power and resiliency benefits we need when there are outages or wildfires,” he said. And when California’s grid faces peak demand during hot summer evenings as solar generation fades away, aggregated batteries from vehicles can provide that supply.”

V2X capability can also drive down costs for people to buy electric vehicles,” Rechtschaffen said, by opening up opportunities for them to earn money for the energy they provide the grid.

These are all important considerations in a state that plans to have 8 million light-duty EVs on its roads by 2030 and to end sales of new gasoline-fueled passenger vehicles by 2035. Utilities and energy regulators have long warned that EVs could be a grave threat to grid stability or a major asset — depending on how they’re managed.

Patty Monahan, the California Energy Commission’s lead commissioner on transportation, said at last week’s DOE event that the amount of electricity needed to charge the EVs expected to be on California’s roads by 2030 adds up to 16 percent of the state’s total electricity demand today.

That’s a huge flexible load, and that’s the excitement with V2X: capitalizing on that load,” she said in an interview last week. California is investing billions of dollars of state and utility funds to deploy EV chargers to serve this coming battery-powered vehicle fleet, and we want to make sure we’re doing all we can to future-proof our investments and capitalize on the ability of vehicles to support a clean grid.”

Why V2X is worth a lot more than simple managed charging

Almost all EVs and chargers can already be controlled to make sure charging is done at times when it won’t overtax the grid. This so-called managed or smart” charging is a requirement for many state- and utility-supported EV-charging deployments. 

V2X — enabling EVs to discharge power back to chargers, buildings or the grid — is quite a bit more complicated, but also a lot more valuable. 

Just managing the flow of power into EV batteries isn’t going to be enough to integrate EVs into the grid,” Gregory Poilasne, CEO and chair of Nuvve, said in an interview last week. There’s a simple explanation for this, he said: Eventually your battery is full, and you can’t do anything with it.”

Poilasne offered the example of a typical passenger vehicle that’s driven to and from work, which only uses a small portion of its battery capacity. Delaying the recharging of that battery from early evening to midnight can reduce grid stresses, he said. But getting any more grid value from that battery will require bidirectional charging.

That simple observation is backed up by a number of studies of the relative value of managed charging, or V1G in industry parlance, compared to V2G charging. Nuvve has done both kinds of charging in European projects, and we know the value of a V1G vehicle is seven to 10 times less than a V2G vehicle,” he said.

A 2021 study by University of California at Irvine professor Brian Tarroja and Rochester Institute of Technology professor Eric Hittinger yielded similar results in its analysis of California’s future energy needs. The study found that the energy-storage capacity value of V2G-enabled EVs is approximately an order of magnitude larger than that for smart charging.” 

For EV owners, the dollar-value difference between V1G and V2G is even greater. The study calculated that smart charging could yield an owner about $87 per vehicle annually, whereas V2G could yield as much as $2,850 per vehicle each year — substantially offsetting the upfront cost of an EV.

This combination of grid value and consumer value makes V2G an integral part of policy efforts to drive down the cost of EV adoption, David Slutzky, CEO of Fermata, said in an interview this month.

I would submit the biggest single obstacle to EV adoption is no longer range anxiety,” he said. It’s the money. They’re more expensive.” Tapping into batteries is where you disrupt the total cost of ownership for an EV.”

Fermata won UL certification for its bidirectional chargers last year and has been testing them in projects in Colorado, Rhode Island, Vermont and other locations, Slutzky said. Now the challenge is to get the technology deployed and develop the standards and regulations needed to bring it to broader markets.

That starts with simpler vehicle-to-building applications, he said — and not just for emergency backup power. Fermata’s work with the city of Boulder, Colorado showed that bidirectional charging from a single Nissan Leaf to a city-owned recreation center cut the center’s monthly electric bill by about 3.4 percent. The Leaf injected enough power into the building to reduce demand charges for peaks in its electricity consumption — a use case that’s driven project owners to install batteries in buildings in California, New York and other markets with heavy demand charges.

EV batteries can also help utilities reduce their peak grid demands, as Fermata has done with utility National Grid in Rhode Island, Slutzky said. That project takes advantage of the fact that Rhode Island and Massachusetts allow batteries to inject power along with reducing load at buildings, something relatively few utility programs permit today.

States such as Massachusetts, California, New York and others with aggressive clean energy goals are going to need gigawatts of energy storage to store and shift solar and wind power from when it’s produced to when the grid needs it, Slutzky noted. So far, the policies aimed at building out that supply of energy storage have concentrated on stationary batteries in utility-scale installations or in buildings.

But the number of EVs being targeted by these states could offer a huge untapped clean-energy-balancing resource, he said. At the very least, [the states] should give the same subsidies as they give stationary storage, and let the market decide what’s more economically ideal.”

Getting from theoretical values to real-world applications 

To be sure, utilities and state regulators have much more control over how stationary batteries are deployed than they do over how much V2G capacity they may be able to access in years to come. V2G capacity will depend on the consumer market forces that will determine how many EVs are bought and whether or not EV owners choose to make them available for these kinds of grid-balancing services.

Dave Mullaney, a principal in nonprofit research group RMI’s carbon-free mobility program, highlighted this inherent uncertainty as a barrier to EVs serving a significant role as grid resources. (Canary Media is an independent affiliate of RMI.) Simply put, stationary batteries can’t unplug themselves and move to different locations periodically, but EVs can.

Fleet vehicles are an easier target for early applications of this EV-as-grid-resource concept. Fleet owners can make agreements to aggregate lots of EV battery capacity in ways that are more reliable to utilities and grid operators.

Electric school buses have been the most promising target for V2G so far, said Monahan of the California Energy Commission (CEC). Electric school buses have hundreds of kilowatts of storage capacity in their batteries and operate on predictable schedules that leave them parked when they can soak up solar power at midday and discharge that power during evening grid peaks.

The CEC has issued grants to deploy about 200 school buses with V2G capability, and we’re also investing in some exploratory work on how to unlock that potential,” Monahan said. California’s roughly 25,000 school buses could provide more than a gigawatt of electricity if converted to battery power, she said.

Nuvve has deployed more than 20 bidirectional fast chargers built by Rhombus Energy Solutions at San Diego County school districts, Poilasne said. Six of them are part of a V2G pilot project with utility San Diego Gas & Electric, aimed at making 1.5 megawatts of battery capacity available to mitigate summer grid stresses.

Mullaney noted that school buses are almost perfectly suited for V2G, but whether other types of EVs can be reliably and economically tapped for V2G services is less clear.

One major challenge of V2G is that it could be stressful to a battery pack to do this,” he said. People are buying EVs to drive, and they’re buying a pretty premium battery pack to do that. Is it the best use of that battery to do V2G services?”

Slutzky acknowledged this concern, saying that automakers and EV owners won’t let you touch the batteries” without safeguards to prevent them from being depleted too deeply or too often. Fermata’s software is designed to prevent discharge cycles that could damage batteries or reduce their useful life, he said. The company also provides a host of options to EV owners to ensure they retain the amount of charge they need to meet their upcoming driving needs, such as limiting discharge to a certain percentage of battery capacity or miles of range.

The number of V2X-capable EVs being promised by automakers indicates a growing comfort that the technology can handle these issues, Slutzky said. Right now the obstacle to scaling is that we need chargers,” he said.

Only a handful of bidirectional chargers are available today, but announcements from companies like Wallbox, dcbel, Heliox and others indicate that all the charger companies are scrambling” to enter the market, he said. (Fermata, which views itself as a software company rather than an EV-charger company, bought bidirectional charger maker PowerHub to have a product it could use in real-world installations, he said.)

Bidirectional-charging technology standards also need to be codified to allow utilities and regulators to approve their use outside of pilot projects. That’s an area where DOE’s coalition of utilities, regulators, national laboratories, automakers and charging-system providers could help push compliance to a standard that allows rapid adoption and moves us all closer to our zero-emission goals,” Rick Sander, CEO of Rhombus, said at least week’s DOE event.

Finding ways to make vehicle-to-everything pay

California has been steadily working to integrate V2X charging into its regulatory structure, Rechtschaffen said. In 2020 the California Public Utilities Commission (CPUC) approved interconnection rules that clarify how utilities can allow bidirectional chargers to be connected to the grid and followed up with further guidance last year. The CEC has issued similar guidance for EV-charger manufacturers on how to comply with key bidirectional standards.

Last week, the CPUC approved utility Pacific Gas & Electric’s request to run large-scale bidirectional-charging pilot programs for residential and commercial customers, as well as a project that would test EVs to power a microgrid, Rechtschaffen said.

As for creating the economic incentives for bidirectional charging, last year’s CPUC decision to approve a set of programs aimed at preventing summer grid emergencies included a first-of-its-kind V2G pilot program, he said. As part of the newly created Emergency Load Reduction Program, the CPUC has guaranteed participating V2G charging sites at least 30 hours of providing energy to reduce peak grid demand over the course of this summer, at lucrative compensation rates of $2,000 per megawatt-hour.

Programs like these are among the first in California to expressly permit payments for electricity that batteries inject back to the grid, as opposed to reducing the grid consumption from the properties where they’re located. More broadly, we’re looking at other proposed rate structures that will compensate electric vehicles when they export to the grid,” Rechtschaffen said. 

RMI’s Mullaney highlighted the importance of adequate compensation structures to make V2G services worthwhile to EV owners. While simple managed charging may not offer the same scale of potential grid benefits as V2G, managed charging is still a valuable resource for reducing grid stress — and one that’s much less complicated to tap into, he said.

But he agreed that a lack of regulations and technical standards shouldn’t be the thing that prevents V2G charging from testing its value to balancing the grid. 

I don’t know what technology is going to provide these grid services,” he said. But the technical capability and standards for all these technologies to have their fair chance should be there.”

Jeff St. John is director of news and special projects at Canary Media. He covers innovative grid technologies, rooftop solar and batteries, clean hydrogen, EV charging and more.