UK Weighs ZEV Mandate Credits for 'Power Plants on Wheels' EVs

By Nathan Brooks

Carmakers installing "vehicle to grid" (V2G) technology could earn ZEV mandate credits worth roughly £4,000 each under plans detailed in a government consultation that closed on Friday. One or even two credits per car, according to thinktank New AutoMotive, would hand manufacturers thousands of pounds for kit that costs a few hundred.

The technology turns electric cars into what ministers call "power plants on wheels." Drivers charge automatically overnight when electricity is cheap, then sell power back to the grid at peak demand — or run their own home from the battery (V2H).

The proposal sits inside the government's review of the zero-emission vehicle (ZEV) mandate, which forces manufacturers to sell rising shares of electric cars or face fines. A V2G-equipped car would earn a credit letting its maker sell one additional petrol vehicle without penalty.

What does V2G actually solve?

The prize is grid balance. Millions of cars able to discharge power could plug one of the hardest gaps in the renewable transition: still, cloudy or dark periods when wind and solar output falls short of demand. Less grid strain also means fewer expensive gas plants fired up to fill supply gaps.

The National Energy System Operator (Neso), which balances Great Britain's grid, has quantified the upside. V2G cars could supply the equivalent of a power station by 2030 — 1.2 gigawatts available on demand. By 2050, Neso forecasts that could reach as much as 41 GW, more than a quarter of peak national demand.

There's already a working market. Some UK drivers sell electricity back through Octopus Energy, which claims annual savings of £620 per household. Renault runs a similar scheme in France, BMW in Germany.

Smart charging tariffs, which need no V2G hardware, already handle the opposite problem — soaking up electricity when it's overabundant and cheap, reducing payments to wind farms asked to switch off. Home batteries can do the same job V2G does.

The catch: credits for kit few drivers use

Campaign groups warn the incentive has a perverse edge. Rewarding manufacturers for fitting V2G lets them sell more polluting petrol models in the near term — while the government separately prepares to cut the ZEV mandate's EV sales targets. Environmental groups expect changes that could add 147 million tonnes of carbon to the atmosphere by 2050.

Ben Nelmes, chief executive of New AutoMotive, said: "Vehicle to grid is exciting technology that could help balance the grid and cut bills, but carmakers should only be rewarded if it's actually used, not just for fitting it."

He added that few drivers own the expensive charger the technology requires, and urged: "Ministers should make sure the people who benefit from V2G are drivers and billpayers, not carmakers' shareholders."

Vicky Edmonds, chief executive of the Electric Vehicle Association England, pointed to the adoption gap. Millions of UK drivers own EVs, she noted, but only a fraction use V2G or storage technologies.

"Consumers are still getting to grips with more immediate questions around the cost of their car, the cost of charging, and whether an EV meets their day to day needs," Edmonds said. "It is far too early to be giving manufacturers a credit that effectively allows them to sell fewer EVs, for a technology that has not even been tried and tested, at scale, by drivers in the real world."

What does this change for carmakers and drivers?

For manufacturers, the credits are effectively a compliance discount — potentially thousands of pounds of avoided fines per V2G car against a few hundred pounds of hardware cost. For drivers, the payoff remains conditional on owning the right charger and joining a V2G tariff; Octopus's £620-a-year claim is the benchmark, not the norm.

The consultation window has now closed. Whether ministers reward fitted hardware or actual usage — the distinction Nelmes draws — will decide whether Britain gets a genuine virtual power station or a subsidy for shelf-ware.