WASHINGTON--The top regulator of the wholesale electricity markets said that electric-vehicle drivers should be able to make money selling services to grid operators.
Federal Energy Regulatory Commission (FERC) Chairman Jon Wellinghoff today said electric-car owners could make as much as $3,000 a year providing what are called ancillary services, such as frequency regulation, to stabilize the wholesale electric market.
Those types of services are technically possible today but regulations need to be changed and new businesses need to be formed before EV owners are active sellers into the grid, Wellinghoff said. But he predicted that within three to five years, vehicle-to-grid services will be available throughout the U.S.
"There's a business model question but beyond that, there are no other barriers," Wellinghoff said in a briefing with the media after a speech at the GridWise Global Forum here.
Grid operators need to keep supply and demand in constant balance to ensure that there's a steady frequency on the grid. Right now, they call on power generators to ramp up the supply of power. But cutting back on the demand side can maintain grid frequency as well.
Electric vehicles can provide frequency regulation, a service that's needed at all times of the day, by slowing their charge rate or supplying small pulses of power into the grid. The University of Delaware is now conducting an experiment where five plug-in vehicles are providing frequency regulation to grid operator PJM when cars are charged over night. Google has also proposed this idea and developed some experimental software to manage electric-vehicle charge rates.
Before electric-vehicle owners could get paid for grid service, another company would need to aggregate the electricity reductions of many cars. Right now, reductions need to be at least 1 megawatt, which would require perhaps hundreds of cars to meet that threshold.
During his speech, Wellinghoff said that regulations should be modified to give demand-side power reductions the same amount of money as power generators do. This would apply to not just electric-vehicle-delivered services but different efficiency steps electricity consumers do at home or in businesses.
Wal-Mart, for example, has an energy-management system that allows it to provide demand-response services, where consumers lower energy use during peak times. The Brattle Group did a study which found that billions of dollars can be saved on energy spending by shaving peak-time demands, Wellinghoff said.
FERC has proposed making a change to rules so that electricity consumers can get paid an equal amount as power generators for demand-side reductions, but it is opposed by power generators, Wellinghoff said.
"We got the technology to do it. We need to let people make money doing it," he said. "The smart grid is all about the demand side."