Electric vehicle owners could earn thousands by supporting power grid

Currently, at least 90 percent of new electricity generation comes from renewable sources. However, solar and wind farms only produce power when the sun is shining or the wind is blowing, leading to fluctuating supplies. A pilot project in Delaware, USA, has demonstrated that electric vehicle (EV) owners could earn thousands of dollars annually by using their parked cars as part of a massive battery system. This system would store electricity when there’s an abundance and release it when demand is high.

Data indicates that EVs are driven just 5 percent of the time, typically remaining parked and connected to the grid. This setup allows electric companies to balance the grid by using power from these vehicles during peak usage times in the morning and evening, then recharging them during the day, according to Willett Kempton from the University of Delaware, who led the project. EV owners could sell this electricity at premium rates while also reducing grid costs.

Kempton explains, “An electric vehicle plugged in 95 percent of the time that it’s not driving can provide storage for the grid at about one-tenth the cost of building batteries. [That could] help increase the reliability of any electric system and increase the capability of us to put more and more renewables on the system.”

During the project, four Ford EVs owned by Delmarva Power were modified to return electricity to the grid using vehicle-to-grid (V2G) technology. Kempton and his team tracked this V2G charging throughout 2025. The electricity supplied by each EV could potentially earn $3,359 annually if sold at market rates.

Kempton, who began exploring V2G in 1997, initially believed it would become commercially viable within a few years. Yet, nearly 30 years later, V2G is mostly found in limited test programs in the US, Europe, Japan, and China.

The complexity of reversing energy flow from the grid to the car has been a significant hurdle, requiring collaboration among automakers, utility companies, and governments, according to Kempton. The main challenge is that power grids primarily use alternating current (AC) electricity, while most household devices, including EVs, convert AC to direct current (DC) when drawing power. To feed energy back into the grid, EVs must convert it back to AC.

Ensuring safety requires V2G components to be designed to a high standard. The simplest V2G setup involves installing a wall charger that converts DC to AC, similar to how solar panels connect to the grid. Some car manufacturers, like Volkswagen and Nissan, already offer such wall chargers in certain markets.

However, these wall chargers can be costly, often running into thousands of dollars. Companies like Tesla, BYD, and Renault are developing EVs with built-in DC to AC conversion technology, and Kempton and others are working on new safety standards for AC chargers. This technology could make V2G more accessible, adding just a few hundred dollars to the cost of a car.

Currently, there is a competition between DC V2G, like Volkswagen’s, and AC V2G, similar to the VHS and Betamax format war of the 1980s. Alex Schoch from UK electricity retailer Octopus Energy notes that while Betamax (and DC chargers) offered better quality, VHS players (and AC chargers) were cheaper and ultimately prevailed. Schoch states, “Our view is there’s a period of time where the market can deal with two different standards, but to really scale and get to mass-market, you’ve got to align on one. We’re firmly team … AC.”

For drivers to invest in a V2G setup, a buyback tariff is necessary to make it financially appealing. In 2024, Octopus launched the UK’s first V2G tariff, although few car owners can currently utilize it. To support this, they partnered with BYD to offer consumers the option to lease a charger and an EV equipped for AC V2G.

Schoch adds, “Many manufacturers, the EVs they’re putting on the road are V2G capable, or the next generation that are hitting the road today or tomorrow will be. And you [will] suddenly have gigawatts of capacity that’s distributed all over the country.”

While V2G adoption could stabilize the grid by balancing supply and demand in real time, it could also increase the load on existing electricity systems. Consequently, V2G may push countries to upgrade their power grids.

A recent study suggests that upgrading grids comprehensively would be more economical than incremental improvements as V2G usage grows. Liangcai Xu from the National University of Singapore, the study’s lead author, advises nations to “prepare the power system at a very early stage” for the V2G revolution.

Co-author Ziyou Song, also from the National University of Singapore, reflects, “I was surprised because I thought V2G can be a silver bullet, it can solve everything. [But] the gap is kind of significant. We have to upgrade our power system decently [so] we can facilitate so much electrical-charging demand.”