Fifteen electric vehicles are selling balancing services to the PJM grid for $5 per day or about $1,800 per year. Why should you care? It is one of the most important energy stories of 2013 to date.
Electric vehicles monetizing their ability to provide grid ancillary services that maintain the grid's stability is a game changer for electric vehicles. It radically changes their economics and could slash by itself the payback period of electric vehicles to just 3 to 5 years.
The 15 electric vehicles are equipped so that they can both take and feed power from and to the grid. These two-way charging vehicles earn money when they are supplying the grid with service that helps to keep it in balance and stable.
Those grid earnings reshape the economics of electric vehicles. If one assumes that an electric vehicle costs about $10,000 more than a gasoline vehicle, and fuel savings are about $1,250 per year, the payback period is 8 years.
But if the electric vehicle can earn $1,800 per year for supplying "ancillary services" to the wholesale grid, as the 15 EVs are doing with PJM, then the payback period is a little more than 3 years. That is a game changer.
Throw in the EVs ability to power a home when the grid is down, a function that Nissan is already including in advertising for the Leaf, and the value proposition for electric vehicles would become compelling for tens of millions of us.