By 2030, EVs could contribute 4% to Europe’s annual energy supply, enough to power 30 million homes annually, according to a new study by EY and Eurelectric. The use of electric vehicles, smart charging and reselling energy to the grid could reduce the cost of a family car by 20%, and flexibility would save European grid operators €4 billion annually. This makes one-way and two-way charging not just options, but necessities.

With Europe’s electricity demand expected to exceed 4,500 TWh by 2050, smart charging and V2G technologies must now be integrated into energy system planning, encouraging consumers to participate in ensuring flexibility.

“The mass adoption of electric vehicles is already a reality, but to fully exploit their potential, we need to integrate them into the grid as elements that provide flexibility. Smart charging and V2G technology will be key drivers of this transition,” said Kristian Ruby, Secretary General of Eurelectric.

EY thus predicts that by 2030 there will be more than 50 million electric vehicles on Europe’s roads, representing 15% of the total car fleet. As electrification accelerates, ensuring the cost-effectiveness, stability and efficiency of the electricity grid will require managing how and when electric vehicles are charged, as well as using the energy stored in batteries to provide valuable flexibility services to the grid.

The report by EY and Eurelectric – “Plugging into potential: unleashing the untapped flexibility of EVs” – looks at how smart one-way charging, which allows electric vehicles to take energy from the grid at the optimal times, and vehicle-to-grid (V2G) technology, which allows electric vehicles to both take energy and send electricity back to the grid, can reduce the total cost of owning a vehicle for consumers, provide solutions for balancing the grid and accelerate the adoption of renewable energy.

“Smart charging and vehicle-to-grid (V2G) are no longer optional – they are essential for cost savings, grid stability and the integration of renewable energy sources. By 2030, electric vehicles could provide 4% of Europe’s energy supply, enough to power 30 million households. For Romania, this represents a major opportunity to optimize energy costs, reduce grid congestion and accelerate the transition to clean energy,” said Mihai Drăghici, Partner, Consulting, EY Romania.

EV flexibility offers significant cost savings for consumers

Taking advantage of EV flexibility can significantly reduce the total cost of ownership for consumers compared to an internal combustion engine vehicle. EY estimates that by simply switching to an equivalent electric vehicle, annual savings could be, on average, 4% in the compact segment, 9% in the family car segment and 14% for large cars/SUVs, across six key markets in Europe.

But while savings vary from market to market, the study shows that when EVs are optimally charged and owners are rewarded for reselling energy to the grid, the total cost of ownership is significantly reduced:

• A compact electric vehicle owner in the UK could save up to 19% (€1,230 annually). In Germany, Sweden and Spain, the total cost of ownership could be reduced by up to 14%. In France and the Netherlands, savings could reach 7% and 9% respectively
• The family car segment could offer drivers annual savings of 15% (€1,200) in France, reaching up to 23% (€1,800 annually) in Germany
• In the SUV segment, UK owners could save up to 26% annually, while in Germany savings of 29% (€3,000) could be achieved.

Flexibility to help save €4 billion annually

Smart charging and V2G technology are not only beneficial for EV owners, but are also essential for managing grid congestion and reducing infrastructure investment costs. The report shows that:

• By investing in future demand, optimising the grid and leveraging the flexibility of available assets, European grid operators could benefit from annual savings estimated at €4 billion
• By 2030, EVs could contribute up to 4% of Europe’s annual energy supply, equivalent to 114 TWh, enough to power 30 million homes
• By 2040, if all EVs are capable of bi-directional charging, over 10% of Europe’s energy needs could be stored and fed back into the grid when needed.

Integrating renewable energy and balancing peak demand

As Europe’s energy mix rapidly shifts towards renewables, the ability to store and offload energy when needed is essential. The report highlights the following:

• Negative electricity prices rose by 160% compared to the previous year. They were recorded in almost all European energy markets, driven by the growth of subsidised and price-neutral generation capacity, such as nuclear power and residential solar panels, combined with low demand
• Demand for flexibility to double in Europe by 2030
• The flexibility offered by electric vehicles could help avoid limiting renewable energy production and ensure the availability of energy during peak demand periods.