UK Consultation Proposes £4,000 Credit for Bidirectional EV Technology

The UK government has proposed a financial mechanism that would allow vehicle manufacturers to earn credits for equipping electric cars with bidirectional charging technology.

Details in a consultation that closed on Friday outline a system where producers can gain a credit for each car sold with vehicle-to-grid, or V2G, capability. This credit would permit manufacturers to sell an additional petrol vehicle without facing penalties under the zero-emission vehicle mandate.

The technology enables vehicles to charge automatically during periods of low electricity prices and then discharge energy back to the grid during peak demand. Officials argue that widespread adoption could help balance the electrical network, particularly during periods when wind and solar generation is low. This capacity could reduce reliance on expensive gas power plants to fill supply gaps.

Critics question whether the incentive structure aligns with actual consumer behavior. Ben Nelmes, chief executive of the thinktank New AutoMotive, noted that carmakers should only receive rewards if the technology is actively used. He stated that under the current proposals, manufacturers could receive credits worth around £4,000 each for hardware that costs a few hundred pounds to install. Nelmes emphasized that few drivers own the expensive chargers required to utilize the system, suggesting the current model benefits shareholders rather than billpayers.

Vicky Edmonds, chief executive of the Electric Vehicle Association England, described the timing as premature. She pointed out that while millions of electric vehicles are on the road, only a fraction of drivers use V2G or storage technologies. Edmonds argued that consumers are still focused on immediate concerns such as vehicle cost and daily charging needs, making it difficult to justify a credit that effectively allows for fewer EV sales for unproven technology.

Environmental groups expressed concern that the new incentives could alter the trajectory of emissions. With the government preparing to lower electric vehicle sales targets under the ZEV mandate, these organizations anticipate changes that could result in an additional 147 million tonnes of carbon emissions by 2050.

The National Energy System Operator, which balances Great Britain's grid, projects that V2G capacity could reach the equivalent of a power station by 2030. The forecast indicates a potential output of 1.2 gigawatts on demand at that time. By 2050, Neso estimates this capacity could grow to 41 gigawatts, sufficient to meet more than a quarter of peak energy demand.

Existing programs already allow some drivers to sell electricity back to the grid through providers such as Octopus Energy in the UK, Renault in France, and BMW in Germany. Octopus Energy has claimed that participants in its service could save £620 annually.