U.S. Report Says California V2G Could Provide About 9 Gigawatts of 12-Hour Storage by 2036

en.Wedoany.com Reported - GridLab, Kevala, and E3 jointly released Unlocking California's Flexible Load: A Durable Blueprint for Affordability and Reliability. The report argues that unlocking the potential of vehicle-to-grid (V2G) infrastructure and customer-owned energy resources is a viable path to addressing California's rising electricity prices and grid reliability pressures.

Based on a series of roundtable discussions hosted by the Energy & Efficiency Institute at University of California Davis, the report recommends integrating electric vehicles, home batteries, smart buildings, and other flexible loads into grid operations to lower electricity costs, enhance grid reliability, and modernize demand flexibility programs.

The study builds on a 2024 analysis conducted by GridLab and The Brattle Group. That earlier research showed that virtual power plants (VPPs) could save California utilities and consumers $550 million annually while meeting more than 15% of the state's peak electricity demand using existing commercial technologies. The new report further identifies the policy and program changes needed to unlock these benefits at scale.

"The next-generation grid infrastructure is already in our driveways, homes, and businesses," said Ric O'Connell, Executive Director of GridLab. "The question is not whether California has these resources, but whether our program designs can unlock their full value. This report provides a roadmap for modernizing demand flexibility so that customers, utilities, and the grid all benefit."

Electric vehicles illustrate the scale of this opportunity. One of the report's key findings is that by 2036, enrolling just 10% of California's projected electric vehicle fleet in V2G programs could provide approximately 9 gigawatts of 12-hour storage, equivalent to more than one-third of the state's 2036 long-duration storage procurement target.

"Customers are investing in electric vehicles, batteries, and smart technology at an unprecedented rate," said Ben Finkelor, Executive Director of the Energy & Efficiency Institute at University of California Davis. "Making it easier for these resources to participate in demand flexibility programs will help customers get more value from their investments while supporting a cleaner, more reliable grid."

Currently, California's demand flexibility programs vary by utility, resulting in a fragmented customer experience, limiting participation, and preventing the state from fully capturing the value of flexible energy resources. The report recommends a standardized, interoperable program framework to boost participation and better coordinate incentives across utilities. Specific recommendations include: standardizing program designs to create a consistent customer experience across California; implementing performance-based incentives that reward verified grid services; expanding participation of electric vehicles, batteries, smart buildings, and other distributed energy resources; improving interoperability and market coordination through consistent program frameworks and market signals; and paying below avoided-cost rates for rigorously measured incremental grid impacts, thereby reducing costs for all ratepayers.

"Affordability is at the core of the report's recommendations," said Eric Cutter, Partner at E3. "Drawing on lessons from California's Net Energy Metering (NEM) experience, the report shows that next-generation demand flexibility programs must reward participating customers based on the measurable value they deliver to the grid, without increasing bills for other customers. Only by tying incentives to grid value and verified performance—not just participation—can demand flexibility help lower system costs, enhance grid reliability, and ensure that the benefits of California's clean energy transition are shared by all ratepayers."

As California continues to electrify transportation, buildings, and industry, demand flexibility can join renewable generation and storage as a foundational grid resource, lowering costs, enhancing reliability, and making fuller use of existing infrastructure.

"Scaling demand flexibility is less about creating new programs and more about making existing ones work better together," said Ed Randolph, former Director of the Energy Division at the California Public Utilities Commission and current member of Caliber Strategies. "Customers should not face different rules depending on where they live. Standardizing program designs and rewarding verified performance will help California scale demand flexibility more efficiently while improving affordability and reliability."