Itron : Will Your Lights Be on When the Power Goes Out?

On March 11, 2011, the Fukushima nuclear power plant in Japan was damaged by an earthquake and tsunami, resulting in widespread and long-term power outages for many Japanese citizens. Several months later, Nissan demonstrated the ability to discharge power from their Nissan Leaf electric vehicle (EV) batteries to provide mobile emergency backup power at various critical sites. These were some of the first real-world examples of 'vehicle-to-grid' (V2G) technology.

Now, 10 years later, EV adoption is skyrocketing. Battery technology and capacity have both improved drastically. Extreme weather events and extended outages are becoming more common. And yet, while V2G is still a hot topic, it has not yet been commercialized at scale.

Itron Idea Labs wanted to know why - so we started talking to EV owners, auto original equipment manufacturers (OEM), V2G providers and other stakeholders. Here is what we found:

• Auto OEM Warranties - The Nissan Leaf is still the only vehicle in the U.S. that enables reverse power flow under manufacturer warranty. Some other OEMs are promising this capability in the near future, but most auto makers still cite battery and power systems degradation from increased charge/discharge cycles as the primary reason for not enabling V2G. With less than 150,000 Nissan Leafs on the road in the U.S. today, the total market of V2G capable vehicles is still quite small.
• Standards - Different EVs still use a variety of physical connector types and communications standards. The Nissan Leaf using the CHAdeMO connector type and standard while most other vehicles are using the CCS connector. CHAdeMO is currently the only EV charging communication standard that has an established protocol for bi-directional power flow. The bi-directional CCS standard is still in development, further limiting the current available market.
• Regulatory - Much of the promised value from V2G comes in 'grid services.' Just like stationary batteries, EV batteries could deliver energy back to the grid to provide capacity or ancillary services. For end customers, using V2G could reduce demand charges, optimize against time-of-use rates, or enable participation in advanced demand response programs. However, in most parts of the country, energy market regulations surrounding V2G have been slow to develop, which means most of the potential value-stack from V2G is not yet available to most EV owners.
• Cost vs. Value - The few V2G charge/discharge units that are becoming available have many advanced features intended to take advantage of the full value-stack of advanced energy markets once they mature. However, most EV owners we talked to didn't have a time-of-use rate or a demand response program to participate in. This means the current price tag of $6000-$8000 (plus installation) for a V2G system doesn't yet appeal to many customers from a cost/ benefit perspective.

Importantly, 97% of EV owners we surveyed were interested or very interested in V2G technology, and their number one reason for wanting it was home backup power during electricity outages lasting four hours or more - not electricity bill savings or other V2G value streams. Additionally, most EV owners had a level 2 charger for their vehicle that they were happy with. They didn't need a new EV charger, they just needed a low-cost backup power solution.

Given this simple problem statement, Itron Idea Labs has developed a low cost prototype that allows a Nissan Leaf to discharge power into the home during outages. It has a modular and flexible design that allows for basic home power backup functionality today. However, with inverter upgrades and wiring updates to the home, other V2G functions could be added as those value streams mature.

We believe the V2G market will grow considerably in coming years as auto warranties, standards and regulatory barriers are overcome. For now, we need to know how big the current market is. To test the market size, we recently ran a series of social media ads targeted at Nissan Leaf owners. If we get enough interest, we will manufacture and market our V2G home backup power system!

Learn more about our process, findings and product design here.