What does bi-directional EV charging mean for home storage batteries?

What does the imminent arrival of bi-directional domestic EV chargers mean for Home Storage Batteries? This question is bubbling around in the heads of some of our customers, so let’s address this head on.

First – a few definitions.

Smart Chargers. All chargers are now “smart”. With smart charging, cars can be plugged in but they don’t have to actually be charging the whole time. Instead, individual EV owners or energy companies can decide when it’s most efficient to charge energy in terms of demand and cost.

Vehicle to Grid (V2G). The concept of Vehicle to Grid envisages that the energy in vehicle batteries can be used to help balance local, regional or national energy needs via smart charging. The batteries of Electric Vehicles could, in conjunction with the equipment supplier, store excess electricity when there is a surplus of supply, and vice versa. To the Electricity Supply Operator, it doesn’t matter whether the vehicle is parked at home or somewhere else. In a fantasy world, we could imagine a situation where an EV is plugged into a bi-directional charger whenever it is static, and therefore all the vehicles of the UK are used to power the country as one giant Virtual Power Plant.

Vehicle to Home (V2H). Vehicle to Home is when a bi-directional EV charger is used to supply electricity from an Electric Vehicle’s battery to a house or, possibly, another kind of building. Vehicle to Home can, therefore, help make our homes less reliant on the electricity grid at peak times.

With both V2G and V2H, the concept of arbitrage & electricity trading is crucial. You’ll buy electricity when it is cheap and sell it when it is expensive.

V2G and Human behaviour

This technology already works and has been trialled by the likes of Indra and other manufacturers.

Whilst the trail was deemed a success, there has to be one massive caveat to any kind of real world trial. These concepts demand user engagement. A trial audience is by definition an engaged audience, so how can we extrapolate out the results generated from these “early adopters” to the general population?

What are some practical issues with V2G & V2H?

First there is the fact that your car needs to be both plugged in and at home (obviously you require the ability to park it at home and plug into your own charger). If you are away at work from 0730 – 1730 hrs Monday through Friday, then the car is not available to power the home or arbitrage with the grid. Plus, it is not available to store the excess electricity from your solar generation, which you’ll most likely have for 200+ days a year.

Whilst we wouldn’t want to overplay this next point, it is the case that plugging in the car can be a chore (project Sciurus only achieved 75% of cars being plugged in every night – you might imagine the trial audience would have been closer to 100%).

Even in the simplest scenario that your author has to deal with (park on drive, plug car in), there are occasions when your author has woken up at 2am thinking “I haven’t plugged in the car”.

So the human behavioural aspect to this is that you do need to actively do something every day to be able to use the electricity in your vehicle.

Here is a more fundamental point. Nobody wants to run out of fuel, be that petrol or electricity.

Your author has a 40 kWh Nissan Leaf. In any given day during the winter (when temperatures are low and the battery performs less well), we will use up 80% of the battery capacity. We require the full 4 hours of overnight cheap charging (the Nissan Leaf is limited to a 6.8 kW charge rate on AC) to provide up to 27.2 kWh of electricity.

By only buying cheap electricity, the running costs of the vehicle are very low, since we are purchasing electricity at 7.5p per kWh during those 4 hours.

What this means though, is that we have not really got any spare capacity to “give” to the grid.

There is no point in me giving to the grid a few additional kWh only for me to have to purchase that back at a similar (or heaven forbid greater) price.

And if you are a motorway warrior, you’ll need more than 4 hours charging. Every night. So the idea that you’ll engage in arbitrage between 1800 – 2300hrs when you get back from the M25 seems a bit unrealistic, especially if you topped up with electricity using a Rapid Charger costing 70+ p per kWh.

So What is the opportunity for V2G?

Well, we believe that the use case for this concept of V2H and V2G is actually quite narrow.

Since we are talking about something that requires human behaviour to adapt to make this work, this concept has to be a routine activity. It isn’t something you only do twice a week.

So firstly, you require spare battery capacity that you do not use on a daily basis.

And this needs to be a pretty much guaranteed spare capacity. You’ll only need to wake up once without enough charge for your long journey because too much got sold for you to then turn off this capability.

Second, although you have a big battery in your vehicle, your daily milage needs to be quite low. If you need more than 28 kWh of charge each night, you’ll be buying the extra kWh at expensive rates, thereby destroying the economic case for arbitrage.

What is the likelihood that you have purchased an EV with an oversized battery? Why would you do that? The battery is expensive. When faced with a choice between model (a) with a 40 kWh battery and model (b) with a 60 kWh battery consumers will have a real financial choice to make. How often will I make a longer journey, can I easily grab some charge on that journey, does the inconvenience of that charging period justify the extra expense of a larger battery?

And don’t forget, as more and more of the population turn to Electric Vehicles, so we are moving down the income scales, and these issues become more fraught.

How can V2G work for ordinary people?

We do think that bi-directional charging is really exciting.

There is a real opportunity to have a distributed Virtual Power Plant, with multi GWh of storage capacity available.

However we haven’t seen a convincing financial model that clearly articulates how this can work for the average working family.

None of these factors come into play with the Home Storage Battery.

The home storage battery removes the human behaviour aspects of the challenge described above – it requires no user intervention to deliver its effect.

Retaining sufficient spare capacity might still be a factor if you just have the battery in isolation. But if you have your own generation capability, this is a fundamentally different proposition.

In this case you are storing electricity that you have generated, and rather than just immediately sending it to the grid for the standard price, you hold it back within the battery and then discharge it when the price becomes more attractive.

Furthermore, it quietly and discretely gets on with the job of:

Powering your home 24/7
Being highly responsive, discharging energy to meet the demand from the home
The interactions with the energy supplier are automatic: The flows of energy at certain times of day or in response to an external demand signal are controlled by the software.
The equipment is located in your property, and is therefore suitable for homes without parking.

We fundamentally believe the Home Storage Battery will endure for the foreseeable future as a critical piece of home infrastructure. These technologies are all complementary to each other.

The financial case for the Home Storage Battery is optimised when installed alongside solar, but remains excellent when working off a night time forced charge using a time of use tariff.