Vehicle-to-Grid Technology Market Overview

Vehicle to grid is a system that allows various types of electric cars such as battery electric vehicles, fuel cell vehicles, plug-in hybrid electric vehicles, and others to interface with the power grid in order to provide demand response services by delivering two-way electricity exchange. One of the primary factors driving the growth of the vehicle to grid market is the increasing use of electric vehicles around the world, which is affecting demand for electric vehicle charging infrastructures such as unidirectional and bidirectional power flow charging. Furthermore, the government's expanding measures to promote the use of environmentally friendly electric vehicles, as well as growing public awareness of environmental issues, has accelerated the expansion of the vehicle to grid industry.

Rising adoption of electric vehicles across the globe has greatly transformed the energy sector. Battery-powered cars proved to be largely effective in controlling carbon emission. Developed regions such as North America and Europe have significantly adopted the electric vehicle technology, along with this; the developing countries have shown tremendous interest for adoption of electric vehicles as a mode of future transportation. Prime factor responsible for the rising demand for electric vehicles is green revolution drives in several nations to protect environment from increasing pollution.

Furthermore, some of the regions such as North America have amended their regulations to support the vehicle-to-grid technology. For instance, National Electric Code (NEC) was amended in 2011 that describes the equipment construction, wiring methods, equipment locations, and control & protection of Electric Vehicle Supply Equipment (EVSE). Additionally, International Codes (I-Codes) that is applicable for vehicle-to-grid technology include International Residential Code (IRC), International Energy Conservation Code (IECC), and International Building Code (IBC). Each code is revised in three years with the required amendments made. The aforementioned factors significantly drive the vehicle-to-grid technology market.

The global vehicle-to-grid technology market size was valued at USD 3.78 billion in 2023 and it is expected to be worth around USD 45.09 billion by 2033, recording a CAGR of 28.13% over forecast period 2024 to 2033. The global vehicle-to-grid technology market is expected to be driven by the emergence of electric vehicles across the globe.

Key Takeaways

• Europe has led the global market with the highest market share of around 35.80% in 2023.
• By Component Type, the electric vehicle supply equipment segment has held the maximum revenue share of 83.13% in 2023.
• By Application, the battery electric vehicles (BEVs) segment held the major market share 63.89% in 2023.
• By Application, the plug-in hybrid electric vehicles (PHEVs) segment is anticipated to grow at a remarkable CAGR of 28.59%.

Vehicle-to-Grid Technology Market in the Europe 2024-2033

Europe vehicle-to-grid technology market size was estimated at USD 1.35 billion in 2023 and it is expected to be worth around USD 16.01 billion by 2033, recording a CAGR of 28.05% over forecast period 2024 to 2033.

North America and Europe are the key regions in the global vehicle-to-grid technology market with significant revenue contribution in 2023. Government initiatives promoting the use of battery-powered vehicles to control carbon emission rate are the major factors that propels the market growth. In addition, long-term warranty offered by the manufacturers along with subsidies and benefits offered by the government on the adoption of electric vehicles attract large consumer base.

Auto manufacturers in these regions are also taking initiative to promote vehicle-to-grid technology as it improves their value chain by improving the battery life. For instance, in December 2018, Nuvve Corporation signed a partnership agreement with EDF Group to implement vehicle-to-grid technology in the European market.

On the contrary, Asia Pacific projected lucrative growth for vehicle-to-grid technology during the forecast period. The prime factors contributing to the significant growth are green revolution drives in Asian countries such as China, Japan, India, and South Korea. For instance, China has vision of fully electric-powered mobility in the region by 2025 and is investing significantly for the same.

Automobile batteries that have been developed recently have a longer operational life and can withstand repeated charging cycles without deterioration. Furthermore, the introduction of vehicle-to-everything technology as an extension of vehicle-to-grid with a smaller size, lighter weight, and easier installation process is fueling market expansion. The market is expected to be driven by massive infrastructural developments and the implementation of favorable government policies boosting smart grid initiatives.

Development in V2G

In detail, V2G in discharging mode allows the EV owners to feed the energy back to the SG when required the most. It helps the grid to improve the performance in terms of efficiency, stability and reliability [3]. The concept of V2G not only benefits to 'balance' the national electricity network but also helps the EV owners by generating revenues. However, it is indispensable to consider that the V2G technique is in its developing stage. Research has initiated to lay hold of its successful establishment in society.

The development of V2G involves three elements that include power connection to the grid, control and communication between EV and the grid operator, and on-board/off-board intelligent metering.

The simultaneous integration of enough EVs with SG may affect the performance of the grid. It brings energy monitoring functionality as an essential part of V2G establishment. Therefore, metering plays a significant role that supports the bi-directional feature of measurement and communication between EV and grid operator. The notion of bi-directional metering inaugurates the implementation of an electronic device called Net Meter. The Net Meter generates bills and enables smart charging based on EV requirement along with SG condition.

The meter measures the import and export energy is similar to the Net Meter in V2G.

Challenges

The current status of V2G technology varies depending on the region and the level of adoption. In some countries, such as Japan and Denmark, V2G trials have been conducted on a small scale, with encouraging results; in UK , Innovate UK - the UK's national innovation agency - is funding a lot of trials. In other countries, such as the United States, V2G technology is still in the early stages of development and deployment.

One of the main challenges with V2G technology is the lack of standardized charging protocols and communication interfaces.

To address this challenge, efforts are underway to develop standardized charging protocols and communication interfaces for V2G systems. For example, the Open Charge Alliance is working to develop an open standard for charging and communication protocols that can be used by any manufacturer or service provider; the protocol OCCP 2.1 support bidirectional communication.

In addition to standardized protocols, V2G systems also require secure and reliable communication between the electric vehicle, the charging infrastructure, and the grid. This requires the development of robust encryption and authentication protocols to prevent unauthorized access to the V2G system and ensure the safety and security of the grid; the ISO 15118-20 has the V2G messaging.

Overall, the development of standardized charging protocols and communication interfaces is crucial to the widespread adoption of V2G technology and the integration of electric vehicles into the grid.

The future of V2G technology looks promising, as an increasing number of countries and companies are investing in the development and deployment of V2G systems. Some of the most promising technologies and initiatives in this field include:

• Bidirectional charging infrastructure
• Vehicle-to-Building (V2B) technology
• Vehicle-to-grid (V2G) aggregation platforms
• Renewable energy integration