Volvo Cars has launched a new business unit, Volvo Cars Energy Solutions, to capitalise on the vehicle-to-home opportunity as EV adoption grows exponentially.
Volvo estimates its fleet battery capacity will reach 50GWh by 2030 as the company transitions to sell only electric models. With the average daily driving distance far below battery capacity, there is ample spare capacity to leverage. The new business will offer technologies and services for energy storage and charging, starting with the upcoming 2024 Volvo EX90 SUV.
An initial pilot project in Volvo’s home city of Gothenburg, Sweden will test bi-directional charging capabilities. This allows EVs to not only charge from the grid, but also send power back to homes and the grid when needed as a distributed energy resource. The technology will be trialed in selected local homes together with grid operator Göteborg Energi Nät.
Beyond powering homes when stationary through vehicle-to-home (V2H), EVs could also directly charge devices like e-bikes through vehicle-to-load (V2L).
Additional revenue streams for EV owners could come from payments for providing services to the grid such as frequency regulation.
Volvo claims bi-directional charging will allow EV owners to save money and reduce emissions. Energy firms also benefit from reduced infrastructure investments and lower environmental impact. However, some barriers remain around warranty implications and coordinating large vehicle fleets.
Volvo is not alone in recognising the potential. BMW is conducting a vehicle-to-grid (V2G) pilot in California, Renault is testing V2G in Europe, and Volkswagen subsidiary Elli has launched an energy trading platform to enable V2G capabilities. Legislation is also being proposed to require bi-directional charging in EVs.
As more EVs hit the roads, their utility as distributed energy assets will grow. Volvo estimates total EV battery capacity will hit 4TWh globally by 2025. Leveraging just a fraction of this for grid services represents a massive new resource.
Realising the vision will require industry coordination, supportive policies, and economical solutions. Volvo is preparing the groundwork with partnerships, new business initiatives, and advanced EV models with bi-directional charging built in.
The transition to electric mobility is about more than just cleaner cars. EVs present opportunities to rethink energy systems and increase sustainability across the board. Soon your electric car won’t just take you places, it will power your home and more.