California Fleets are Powering the Grid: V2G Value Stacking

Vehicle-to-Grid (V2G) technology feeds electricity from the batteries of electric buses, trucks, and cars back into the grid. When you have many V2G-connected vehicles and chargers across a service area, they can be aggregated into a Virtual Power Plant (VPP) to contribute meaningful amounts of power and reduce the need for fossil fuel power generation. The growing number of electric vehicles in fleets, each with a battery big enough to power a home for days, means that V2G fleets can make a big impact — providing power to help meet peak demand when electricity generation and consumption is most expensive.

So why isn’t V2G happening everywhere, all the time? Although the technology has been well proven, it’s only beginning to be commercially available, with a few specific bidirectional vehicle and charger compatibility combinations on the market today. Plus, many electric utilities have frameworks and rules that make most EV rates and demand response programs mutually exclusive, limiting the usefulness to the grid and therefore the value to the owner.

But things are starting to change: Electric utilities across North America are beginning to launch pilot programs to test the potential of V2G, and California is one state at the forefront. There are now two complementary programs in the Golden State that electric vehicle fleets with bidirectional chargers can leverage. By enrolling in both the Emergency Load Reduction Program (ELRP) and the V2X Pilot with Hourly Flex Pricing (HFP) simultaneously, fleet operators can maximize the revenue their idle vehicles can generate. Let's take a look at these programs and the value they bring.

V2G Value #1: Demand Response

California’s Emergency Load Reduction Program (ELRP) recently concluded its fifth season, between May 1 and October 31. PowerFlex (formerly The Mobility House North America) participated in this demand response program as a direct aggregator, enrolling fleet customers in its Virtual Power Plant to provide access to the program.

ELRP is a program initiated by the California Public Utilities Commission and administered by the three investor-owned utilities: Southern California Edison, San Diego Gas & Electric, and Pacific Gas & Electric (PG&E). These electric utilities offer financial incentives to participating homes and businesses for reducing their energy use during times of high grid stress and emergencies — or for exporting energy via V2G. Fleets can generate $2 per kilowatt-hour (kWh) from ELRP for discharging power from their buses during designated demand response events for up to 60 hours per season.

ELRP events can be called the day before or same day, up to one hour ahead. To ensure fleets capture maximum value, PowerFlex’s charge management system, ChargePilot® by PowerFlex, enables fully automated participation in ELRP. The system receives a signal from the program that an event is scheduled, then automatically triggers discharge from EVs to the grid no matter how short-notice the event is.

Traditional demand response relies on manual intervention, which is why it requires day-ahead notifications. PowerFlex’s automation with OpenADR, however, enables real-time demand response, whenever the notification is issued.

V2G Value #2: V2X Pilot With Hourly Flex Pricing

For fleets in Northern California, PG&E has Vehicle-to-Everything (V2X) pilot programs that can help fleets get additional value from bidirectional charging. For commercial fleets that install bidirectional chargers, the Commercial V2X pilot offers an upfront incentive of up to $2,500 for 3-phase chargers less than 50 kilowatts (kW), and up to $4,500 for 3-phase chargers 50 kW or higher. There is an additional $500 available in each of those categories for customers in Disadvantaged Communities. The V2X pilot programs encompass multiple use cases for bidirectional charging, including Vehicle-to-Building (V2B) to supply backup power to the customer's facility and Vehicle-to-Grid to supply power to the distribution grid. Participants in the V2X pilot can stack incentives with dual enrollment in ELRP and Hourly Flex Pricing.

Hourly Flex Pricing (HFP) is a pilot rate administered by PG&E for leveraging hour-to-hour electricity price fluctuations, risk-free. Since the actual price is unique to the user, based on the divergence of their actual load from a baseline load shape, more volatility in the price signal generally means more opportunities to save money. A lucrative circuit may frequently swing from $0.05/kWh to well over $1/kWh. This means that a single V2G-enabled school bus on the most constrained circuit could make over $20,000 in the first year of operation.

Electric fleets in California such as school bus operators can enroll in HFP and ELRP concurrently to maximize the value they are able to create with V2G. The programs complement each other well. The ELRP program is limited to 60 hours between May and October, whereas HFP creates V2G revenue opportunities year round. HFP and ELRP both provide day-ahead guidance so that fleet operators have an idea of their next day’s charging schedule. ELRP events may also be called same day, in which case PowerFlex’s fleet charging optimization technology can automatically adapt the charging plan to take advantage of V2G demand response. If a fleet participates in both HFP and ELRP, V2G revenue will be compensated based on whichever program is more lucrative for the fleet at a given time. ELRP has a fixed rate of $2/kWh and HFP has a fluctuating price signal for every hour of the year.

PowerFlex Maximizes V2G Value

ChargePilot® by PowerFlex manages fleet charging with the highest degree of reliability and interoperable charging hardware. The platform also works with PowerFlex's EV Load Aggregation system to receive signals from a utility provider, such as PG&E, to coordinate a charging and discharging plan to optimize for V2G revenue — while still guaranteeing charging reliability and vehicle readiness. The algorithms automatically respond to the highest value opportunity across both ELRP and V2X HRP, enabling fleets to maximize revenue opportunities and stack V2G value. PowerFlex uses this technology to serve as a Direct Aggregator for the ELRP program and an Automation Service Provider for the HFP rate.

Interested in leveraging your fleet vehicles to make money through V2G, and support the grid in the process? Talk to one of our experts today.