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Advanced Rate Designs Harnessing Vehicle-Grid Integration Technology


January, 2022

As we transition to an intelligent electric vehicle (EV) future, charging loads pose a potential major challenge for utilities without proper planning and management. Vehicle-Grid Integration (VGI) technologies convert EVs from a potential grid strain to a valuable new grid resource.

EV customers want to minimize their EV charging costs, which are governed by their utility’s rates. Through Vehicle-Grid Integration, managing the time and power of this charging can create costs or benefits throughout the value chain. Time-of-Use (TOU) rates are by far the most common EV rate implemented by utilities, but these do not fully realize potential VGI benefits. Advanced metering, declining technology and communication costs, and rapid commercialization of smart charging technologies make advanced rate designs a viable and broadly available VGI pathway.

Honda has set a target to sell 100 percent electric vehicles in North America by 2040. This paper, commissioned by Honda and authored by Energy + Environmental Economics (E3), presents a roadmap to new rate designs that harness active VGI technology and EV charging aggregators with the goal of benefitting customers, utilities, and the grid.

To receive the companion paper, “Design Principles and Options for Retail Tariffs that Support Vehicle-Grid Integration," click here.

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