California is facing a unique challenge as it works to increase its use of solar panels and wind turbines. The state is successfully lowering greenhouse gas emissions and improving air quality but must address intermittency issues—when the sun isn’t shining or the wind isn’t blowing, electricity isn’t generated. To combat this, California is developing battery farms to store energy. Its storage capacity has increased by 2,100 percent between 2019 and 2025, ensuring electricity availability even in less favorable weather conditions.
In addition to battery farms, California has another largely untapped energy storage resource: electric vehicles (EVs) parked in driveways and garages. Many EVs come with vehicle-to-grid (V2G) technology, allowing them to return power to the grid during high-demand periods. A recent report highlights that if just 10 percent of EV owners in California participate in V2G programs by 2036, they could supply one-third of the state’s target for long-duration energy storage. Pete Skala, vice president at the grid software company Kevala, which co-authored the report with GridLab and E3, explained that a small number of participants could significantly reduce the need for costly grid-scale storage solutions.
The report suggests combining V2G with other flexible load devices that can either supply power to the grid or adjust their energy use, spreading demand throughout the day. This approach presents a major opportunity for California to speed up its transition to renewable energy, strengthen the electrical grid, and lower costs for everyone. The key is making the grid more adaptable.
Nationwide, grids face similar challenges. Electricity demand is increasing as people switch from fossil fuels to electric stoves, heaters, and vehicles, and as data centers consume vast amounts of energy. Rising temperatures also push more people to use air conditioning, especially in the evenings when they return home, which heightens electricity demand during summer.
Utilities used to manage this demand by increasing production at natural gas power plants. However, with the growth of solar energy, power generation drops as the sun sets, just when people turn on their air conditioners and other appliances. This has made the need for large, expensive battery facilities more pressing.
However, as more people purchase EVs, which often remain idle and plugged in either at home or work, there is a potential power resource ready to be tapped. Skala noted that leveraging this resource could reduce the need for additional grid-scale storage.
Using V2G technology could also lessen the financial burden on utilities, which often pass costs onto consumers through rate increases. The report stresses the importance of establishing a compensation structure to incentivize EV owners to provide backup power. While overcompensating could lead to higher costs than building more battery facilities, even a small fraction of EV owners participating could make a significant difference. Utilities could then call on more vehicles, reducing the energy required from each. EV owners would maintain control over their battery levels, ensuring they have enough charge for personal use. As a result, even those without EVs could benefit from stable rates if additional infrastructure isn’t needed. Skala emphasized the need for incentives that benefit everyone.
The report recommends that V2G implementation should go hand-in-hand with strategies to reduce electricity demand. For instance, utilities are already using smart thermostats to remotely adjust homeowners’ indoor temperatures during heatwaves, which can reduce air conditioning use. This “demand response” approach, implemented across numerous thermostats, can help ease the grid’s load by decreasing the late-afternoon spike in energy consumption.
In the near future, with the combination of V2G and demand response strategies, individuals will play a more active role in the grid, beyond merely consuming electricity. If executed well, these programs could collectively drive the shift towards renewable energy and lower electricity costs for all.
