Jaideep Saraswat, Nikhil Mall

India is seeing a sharp and sustained rise in electricity demand. Peak demand has grown from 156
GW in 2015-16 to 249 GW in 2024-25, a 1.6x increase in less than a decade. Electricity consumption
has mirrored this growth, rising from 1001.19 TWh in 2015 to 1543 TWh in 2023-24. Going forward,
the trajectory points only upwards. Urbanisation, a rapidly growing population, soaring air-
conditioning usage, the rise of an aspirational middle class, a manufacturing push under Make in
India, electrification of industries, focus on clean heat, a surge in data centers to power India’s AI
ambitions, and the target of 30 percent EV sales by 2030—all these factors will fuel even greater
electricity consumption.

But this growth comes with a hidden cost. Meeting rising demand without innovative solutions will inevitably drive higher electricity tariffs. Families will see their household budgets strained. Businesses will face steeper operating costs. The economy as a whole will be burdened by the need for costly infrastructure upgrades, increased reliance on fossil fuels, and environmental degradation. If left unchecked, escalating energy rates could dampen India’s growth story.

EVs are more than just a mode of transport

India now has over 3.5 lakh electric cars on its roads, supported by 29,000 public charging stations. But EVs should not be seen merely as vehicles, they are “batteries on wheels.”

On an average, an electric car in India has a 70-kWh battery pack that is used only about 5 percent of the time—the rest of the time, the vehicle sits idle. This unused storage presents a massive opportunity. If connected intelligently to the grid, EVs can both draw power and supply it back when needed. This is the essence of Vehicle-to-Grid (V2G).

What is V2G and how does it work?

V2G functionality enables EVs to not only draw power from the grid but also send stored energy back, transforming them into mobile energy assets. V2G can operate in two modes:

• AC V2G: The inverter inside the vehicle supplies AC power synchronised with the grid.
• DC V2G: The external charger converts DC power from the vehicle into grid-synchronised AC.

How consumers benefit from V2G

EV owners can generate additional income by participating in energy markets through energy arbitrage, capacity markets, ancillary services, and transmission/distribution deferral by reducing congestion costs. These benefits are typically passed on by utilities to EV owners in the form of monthly payments or credits.

Practical scenarios for EV owners:

• At night when the vehicle is idle: Smart scheduling software can manage charging and discharging cycles, optimising energy flow based on grid demand, electricity prices, and the driver’s next-day travel needs.
• During office hours while parked: EVs can discharge power back to the grid during peak demand, allowing owners to sell electricity at higher tariffs. This creates an additional revenue stream and helps reduce the total cost of ownership (TCO) of the vehicle.

Why V2G matters for India

V2G is not a ‘nice to have’, it’s essential for India’s energy future. Here’s why:

• Grid Stability & Peak Shaving: With more renewable energy (RE) on the grid, balancing intermittency is a challenge. EV batteries can act as distributed storage, reducing reliance on expensive fossil-based spinning reserves.
• Cost Savings for Consumers: Under Time-of-Day (ToD) tariffs, consumers can charge EVs when electricity is cheap (say, during daytime solar surplus) and feed power back during peak evening hours, lowering their bills.
• Synergy with Solar Rooftops: India has already installed 18 lakh solar rooftop systems under the PM Surya Ghar Yojana, with a target of 1 crore households by 2026-27. Pairing rooftop solar with V2G turns EV batteries into a goldmine, absorbing excess solar during the day and releasing it at night.
• Avoiding Costly Infrastructure Upgrades: V2G can defer investments in transmission and distribution infrastructure, reduce the need for stationary storage systems, and optimise grid investments.
• Massive Storage Potential: If even 25 percent of India’s existing electric car fleet participates in V2G, it would unlock 3.5 GWh of storage capacity, a virtual mega-battery for the nation.

A critical window of opportunity

Globally, automakers such as Nissan, Renault, Ford, and GM already offer V2G-capable vehicles. Over 70 such models exist worldwide. Yet in India, not a single commercial V2G-enabled car is available, held back by regulatory inertia, lack of technical standards, and automakers’ hesitancy due to perceived battery health risks. Yet, global studies consistently show that the impact of bidirectional charging on battery health is negligible compared to the significant benefits V2G offers.

While household battery packs of 3-5 kWh are too small to make meaningful contribution, EVs with 40+ kWh batteries often sit idle in garages for most of the day. Unlocking their potential through V2G could save billions in grid infrastructure costs and accelerate India’s clean energy transition. Missing this opportunity would be a costly delay.

What India must do

For V2G to become a reality in India, urgent and coordinated action is needed. The India Electricity Grid Code (IEGC) must be updated to explicitly allow bidirectional power flow. All new charging stations being deployed should be V2G-ready from the outset as retrofitting later would be wasteful and expensive. Technical standards need to be developed to ensure grid safety and protect utility workers. Just as importantly, clear financial incentives and price signals must be put in place so that consumers see tangible value in participating. Automakers, both Indian and global, must step up and bring V2G-capable models to the Indian market, treating ecosystem-building as a priority rather than an afterthought. And finally, collaboration among all stakeholders such as utilities, grid operators, regulators, charging companies, and carmakers will be essential to align on a national roadmap.