EVs are finally starting to play a real role in giving back to the grid.
Toronto-based EV charging startup Swtch announced last week that it will join virtual power plant projects in New York and Massachusetts with San Francisco software company Leap.
The concept of virtual power plants, or VPPs—a bunch of small power sources in homes or offices that act together to feed electricity back into the grid, or coordinate themselves to suck less power at peak periods—has been around for a while, mostly as a way for homeowners to generate extra cash with solar panels.
But they rose to prominence when Elon Musk launched a program to supplement the Texas grid after it came close to collapse in 2021.
“The increasing demand for electricity and growing number of electric devices like EVs, combined with more extreme weather … have all led to greater interest,” said Sam Plunkett, director of Leap’s mobility work. “VPPs have gained attention because they’re cost effective, making use of the devices already in homes and businesses.”
Until recently, EVs were considered more of a problem for the grid than a solution. But more vehicles and chargers have gotten bidirectional or vehicle-to-grid technology: see the F-150 Lightning’s selling point of allowing owners to power their home.
There are a few other factors driving VPP adoption. An analyst note from Morningstar DBRS last month cited the push toward renewable energy and “advanced analytics” (think: smart thermostats that can give you discounts for turning off your air conditioning in peak periods).
Vehicle-to-grid technology is still only available on a small, if growing, share of EVs, noted Swtch chief financial officer Samuel Bordenave, who previously worked on VPPs at Tesla.
For now, the company is catering to drivers who are already sitting on more energy than they need: people who routinely plug in their car for longer than it takes to charge.
For example, Bordenave noted, if you plug your vehicle in when you get home at 6 p.m. and don’t unplug it until 7 a.m., you could use VPP software to set your e-charging session to begin at midnight, avoiding peak periods on the grid. In exchange, you might get an incentive from a utility company.
“The two reasons that people cite when they say they’re undecided about getting an EV are, number one, it’s too expensive. And number two, I’m concerned with the availability of charging,” said Bordenave. “We can address both of these things.”
Residents of multi-family units have typically struggled to get incentives from utility companies because they require both building owners and tenants opting in.
“Swtch is in a great position to crack that market as they have relationships with the building owners, and they have the software for both the building owners and tenants,” said Leap’s Plunkett.
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