UK government endorses 'vehicle to grid' technology

Out-Law News | 17 Aug 2018 | 2:10 pm | 3 min. read

The UK government has endorsed technology which allows electric vehicle owners to supply electricity stored by the vehicle batteries back to the grid.

'Vehicle to grid' (V2G) technology can help consumers making money when using electric vehicles, it said.

Earlier this year, specialists in energy sector innovation and contracts Lindsay Edwards and James Mashhadi of Pinsent Masons, the law firm behind, explained how electric vehicles are spurring new business models. At the time they highlighted the potential of V2G.

According to Edwards and Mashhadi, industry has been exploring so called 'V2G' bidirectional charging stations, which provide for charging the batteries in electric vehicles and discharging the electricity those batteries store when the vehicles are not in use. The technology offers users the potential to charge their vehicles at off-peak times at associated lower rates, and supply electricity back to the grid directly, or via third party aggregators, at times of peak demand and receive payment for doing so, they said.

As the market develops, V2G technologies could also provide consumers with a greater degree of control over how they use energy in their home, they said.

Earlier this week, the Department for Business, Energy & Industrial Strategy (BEIS) praised V2G technology offered by OVO Energy, highlighting how it works in conjunction with smart meters.

"OVO Energy … is one of just a few companies already using smart meters to offer innovative products, such as rewarding customers for charging their electric vehicles at off-peak times," the BEIS statement said. "These offers, made possible thanks to a smart meter, help customers use energy at times when there is less demand on the grid, in turn saving money on their bills."

"Smart charging and vehicle to grid charging could become a cornerstone of the way we use energy in the UK, with more than eight million people in Britain considering buying or leasing an electric vehicle in the next five years. With this technology, customers will not only be able to choose to use energy at the cheapest times but also make money by selling energy from their vehicle’s battery at times when it is most in demand. This will support the growth of renewable energy generation in the UK," it said.

Innovations in smart energy have the potential to save the UK as much as £40 billion between now and 2050, it said.

Stephen Fitzpatrick, chief executive and founder of OVO Energy, said it is vital that the UK government and energy companies continue to advocate the take up of smart meters.

"The smart meter rollout is a huge and complicated programme," Fitzpatrick said. "However, there’s no question it needs to be done as we can’t build the energy system of the future unless we know accurately how much energy people are using and when. OVO is using technology like electric vehicles, smart electric heat and batteries to help lower energy bills for consumers and enable us to use more renewable energy. None of this technology will work without smart metering."

More than 11 million smart meters are already in use in UK properties, UK energy minister Claire Perry said.

Smart meters are one of the smarter energy technologies of the future, according to a special report by Pinsent Masons, the law firm behind he meters have been identified as having the potential to reduce unnecessary energy use and emissions and to cut consumers' energy bills, and the UK government has set a target for their installation across the UK by the end of 2020 – it has said more than 50 million smart meters could be installed under the initiative.

UK electricity and gas suppliers are under an overarching obligation to take all reasonable steps to ensure that a smart meter is installed on or before 31 December 2020, but consumers are not forced to accept them. To aid the scheme, the suppliers have been under a licensing obligation to submit smart meter roll-out plans. The largest of those suppliers – those that supply to 250,000 or more gas, electricity or dual fuel customers – have also been required to submit binding annual milestones for the installation of smart meters alongside those plans.

Chris Martin, a specialist in smart metering and technology contracts at Pinsent Masons, said in May, though, that the anticipated adoption of smart meters in the UK looks set to fall below government's original expectations.

"Whilst the overall cost of the roll-out has continued to rise, consumer interest has remained relatively low, which, in effect, means that the overall cost per smart meter installed will likely be significantly greater than had been assumed by government, bearing in mind the costs of implementing the required technical infrastructure and governance that sits at the heart of the roll-out," Martin said at the time.

"Lower than expected volumes of installs will also mean that hardware and per-install costs may very well increase as meter manufacturers and installers will not achieve expected economies of scale. There are limits to what energy suppliers can do to counter lower-than-expected consumer engagement," he said.

Martin was commenting after Ofgem, the UK's energy regulator, called on energy suppliers to do more to support the take up of smart meters.

Earlier this summer, new legislation aimed at supporting upgrades in UK infrastructure to accommodate the anticipated growth in the use of electric vehicles received Royal Assent.