With petrol and diesel vehicles, fuel goes in the tank and remains there until it is consumed. But with EVs, we are starting to view them more as mobile energy resources thanks to their batteries. In fact, this has the potential to play a huge role in our wider green energy transition.
On a smart grid, EVs enable us to move energy both ways. Bidirectional charging, commonly known as vehicle-to-grid (V2G), allows electricity to flow from the vehicle to the grid. In this way, V2G can help the grid to better manage peaks in demand, while also providing a new revenue stream to the EV’s owner.
Fleet operators are a prime candidate for V2G. Their EVs often work predictable hours before returning to base to plug into charge points. V2G enables the grid to extract some of the remaining electricity from those vehicles’ batteries in the early evening when demand for electricity is peaking. In this model, the fleet operator sells that energy back to the grid at peak prices, then recharges the vehicles overnight on a lower tariff.
Research by the Transport Studies Unit at the University of Oxford estimated that this could generate annual income of between £100 and £500 per vehicle. Studies have also shown that V2G can create genuine value with very little impact on the battery’s degradation.
There are additional broader benefits, especially around energy security. After all, reducing reliance on imported fossil fuels improves economic resilience.
The V2G concept has been around for more than a decade but is rapidly becoming a commercial reality. Market analysts Research & Markets estimate that the global V2G market was worth more than $5 billion in 2024 and will top $25 billion by 2029.
As V2G adoption grows, it will create a cultural shift in how we view EVs, as well as changes to how they are recorded on a business’ balance sheet. They cease to be simply depreciating assets, becoming more nuanced and complex tools for revenue generation. However, there still needs to be step change in how we view the batteries over their full life cycle.
