UK drivers’ bills could be £6.5bn higher if Government goes slow on EV roll-out

The government is expected to announce details of its Zero Emission Vehicle (ZEV) Mandate imminently – a policy that will require car manufacturers to ensure an increasing proportion of the cars they sell in the coming years are electric. If the mandate follows the car industry’s ‘high’ deployment scenario and encourages ‘vehicle-to-grid’ (V2G) technology, 13.5million V2G capable EVs could be available to sell electricity to the grid at times of peak demand by 2035, earning their owners a total of almost £7.6bn by that time.

However, should the Government proceed with its current proposed targets and the rollout of V2G technology happens slowly, as few as 2.3million V2G capable EVs could be available by 2035, earning their owners just £1.1bn – meaning drivers could miss out on taking £6.5bn off their energy bills.

V2G technology allows cars to send energy back to the grid. This would enable their owners to make money by charging up cheaply overnight, and selling back at peak times when electricity is more expensive. By 2030, V2G could potentially provide 20GW of power, replacing 20 gas power plants at times of peak demand in winter.

ECIU analysis has found that a driver of a Nissan Leaf with a small battery, doing the UK average 20 mile round-trip commute, could make £850 a year, simply by leaving their car plugged in and selling electricity back to the grid for two hours during the evening peak in electricity demand. Even on a cold winter’s day, the car would still have 35 miles of charge left before recharging to 80% overnight when demand is low. If charged fully, more than 35 miles of power would be left.

Colin Walker, Transport Analyst at ECIU, said: “Cheaper renewable power will help to keep EV running costs well below that of petrol cars, but electric cars in turn can also support the grid during peak times. The potential is enormous, enabling drivers to make money simply by plugging in after a day at work. This small act in turn brings down the costs of running the grid, cutting everyone’s bills, and reducing the quantity of gas we need to import.”

Latest sales figures for February show EV sales are up 18.2% year-on-year and are now the second largest category of cars sold after petrol [2].

70% of households with a vehicle in England have access to private, off-street parking [3] – making the installation of V2G chargers for the majority of potential EV owners straightforward.

Previous ECIU analysis found that a ZEV Mandate following the car industry’s ‘high’ EV deployment scenario could save second-hand car buyers £9bn by increasing the pool of second-hand EV, and so access to cheaper running costs. EVs are currently around 2.8 times cheaper to fuel than petrol cars [4].

VW and Audi have announced plans to introduce V2G technology, with Hyundai currently trialing it in the Netherlands.