The UK government is considering giving carmakers credits under the zero-emission vehicle mandate for installing vehicle-to-grid (V2G) technology in electric cars. The technology allows EVs to charge when electricity is cheap — typically overnight — and sell power back to the grid during peak demand. Ministers see it as a way to address one of the hardest problems in the renewables transition: balancing supply during still, cloudy, or dark periods when wind and solar generation drops below demand. The numbers are genuinely significant. The National Energy System Operator projects V2G could deliver 1.2 gigawatts of dispatchable power by 2030 — equivalent to a gas-fired power station — scaling to 41 GW by 2050, enough to cover more than a quarter of peak demand. Companies like Octopus Energy already operate small-scale V2G services, claiming drivers can save £620 a year. The infrastructure exists in embryo; the question is how to scale it. Here is where the policy design starts to crack. Under the consultation that closed Friday, a carmaker fitting V2G hardware to an EV could earn one or even two credits worth approximately £4,000 each. Each credit offsets the obligation to sell one more zero-emission vehicle — meaning it effectively permits the sale of an additional petrol car without fine risk. The cost of the V2G hardware itself runs to a few hundred pounds. The margin between hardware cost and credit value is where extraction lives. Critics from both the Electric Vehicle Association England and the New AutoMotive thinktank zeroed in on the same structural flaw: the credits reward installation, not usage. As Ben Nelmes put it, manufacturers get thousands per car for kit costing hundreds, even though few drivers currently own the expensive bidirectional charger needed to actually use V2G. Vicky Edmonds was blunter — it is "far too early" to grant credits for technology that has not been tried and tested at scale by real drivers. The timing compounds the problem. The government is simultaneously preparing to cut EV sales targets under the ZEV mandate. Environmental groups estimate the combined effect could mean an additional 147 million tonnes of carbon emitted by 2050. Layering a generous credit scheme for unproven technology on top of weakened targets creates a compounding incentive: sell fewer EVs, fit cheap hardware to the ones you do sell, pocket the credit spread, and keep petrol volume flowing. The underlying idea — turning millions of parked EVs into a distributed battery network — is genuinely generative. Grid flexibility from vehicle batteries could reduce reliance on expensive gas peaker plants, lower consumer bills, and smooth the integration of intermittent renewables. But the implementation mechanism channels most of the near-term value to manufacturers through the credit arbitrage rather than to drivers or billpayers. A credit-for-installation regime without a usage requirement is a subsidy for hardware fitting, not for grid services. The fix is obvious and several stakeholders have already named it: tie credits to demonstrated V2G energy flows, not hardware presence. Until that distinction is made, this policy risks becoming a loophole dressed as innovation — one that slows EV adoption while claiming to accelerate grid resilience.
