Policy and pricing tools to incentivize distributed electric vehicle-to-grid charging control

Flexible electric vehicle (EV) charging could benefit the electricity system and help integrate renewables, if given the right incentives. Bidirectional vehicle-to-grid (V2G) technology increases EV flexibility and could increase those benefits. However, the business case for small-scale V2G is unclear, limiting widespread deployment. Here, we assess the impacts of different time-of-use electricity tariffs and compare three policymaker tools to improve profitability for V2G aggregators: regulating the reimbursement of network charges and taxes on discharged energy, subsidizing new stations, and increasing the spread between low and high time-of-use prices. We use an agent-based EV model in a case-study of workplace charging in Switzerland. We model the aggregator’s maximization of V2G revenues over electricity, hardware, installation, and operating costs as a mixed-integer linear program. We find that different tariffs better support renewable integration or reduce peak demand. Profitability is highly sensitive to the cost of V2G stations and the difference between the lowest charging and highest discharging prices. Some subsidies will be needed until V2G station costs fall at least below 8706 ± 942 CHF. Policymakers could regulate reimbursement of network charges or taxes for discharged energy or stretch tariff price spreads to support deployment of distributed V2G. • Policy interventions affect profitability for small-scale V2G aggregators. • Business case depends on station costs, electricity tariffs, and regulation. • Low-high electricity price spread must overcome round-trip losses. • Reimbursing taxes or network charges for V2G improves profitability. • New time-of-use periods would improve future system impacts of V2G.