Cleantech Market Intelligence
Could On-Demand Mobility Finally Pave the Way for Vehicle-to-Grid Integration?
A decade ago, when discussion of modern plug-in electric vehicles (PEVs) was just getting ramped up again, one of the big potential selling points was the concept of vehicle-to-grid (V2G) integration. For a variety of reasons, it never quite caught on. However, as automakers, suppliers, and a variety of service providers have made a flurry of announcements about deploying autonomous vehicles into ride-hailing services in recent weeks, the time may also have arrived for V2G.
The idea behind V2G was to enable two-way communications and power delivery between PEVs and charging outlets. In addition to electricity flowing into the vehicles’ batteries to enable mobility, PEVs could also provide power back to the grid when needed to cover peak demand loads. A number of automakers have worked with utilities over the years to test out the concept, including Ford. When the automaker built a fleet of 20 prototype Escape plug-in hybrids for field testing in 2008, the cars were loaned out mostly to utilities to evaluate V2G.
Benefits of V2G
For customers, potential benefits of participating in a V2G system include possible rebates for contributing power back to the grid or discounts on charging during off-peak times. Utilities using V2G would have access to a buffer of power during load spikes that would reduce the need to build out extra generating capacity.
Unfortunately, sales of PEVs have turned out to be far lower than many projected a decade ago, with fewer than 120,000 sold in 2015. At the same time, there are more than 3,300 electric utilities in the United States, all with different (and incompatible) systems. With relatively few PEV owners, many with low-range battery EVs, there wasn’t a huge demand for V2G from consumers concerned about being left with insufficient range when they needed their vehicles.
Enter the era of autonomous on-demand mobility (AMOD). Navigant Research’s Transportation Outlook: 2025-2050 report projects that as the world becomes increasingly urbanized and crowded in the next 3 decades, there will be a push toward AMOD to solve the combined problems of air quality, safety, and urban congestion. Most if not all of the autonomous vehicles used to provide these services are also expected to be electric.
New Business Models
Large fleets of more standardized EVs should ease some of the technical issues involved with V2G and could provide the critical mass of fleet size needed to make the investment worthwhile for both utilities and fleet operators. By taking individual owners out of the equation, the fleet management system could cycle some percentage of these autonomous vehicles through V2G-enabled charging stations during the peak hours of electricity demand to provide the needed buffer.
In a world of dramatically reduced retail vehicle sales and the possibility of automakers running these mobility services, such a scheme could also be beneficial to today’s auto dealers. Those dealers could turn their focus to providing maintenance services for fleets, and while vehicles are onsite, they could participate in the V2G system. If utilities were to share part of the savings from not having to expand generation capacity with these mobility and service providers, it would contribute to a new revenue model. As the transportation ecosystem transforms in the coming decades, everyone in the supply chain will need to look at innovative approaches to building a sustainable business.