Solar installers: Add EV charger installation to your services now Bidirectional EV charging will soon upend the solar + storage installation market.

The clean energy market is constantly evolving, and solar installers are used to adapting. Solar hot water installs were quickly overtaken by the shift to rooftop PV. Threats to net metering and more utility shutdowns have required contractors to get comfortable with installing batteries alongside more advanced solar layouts. Just as the industry receives a standalone storage investment tax credit that could accelerate home battery adoption even further, a new product could flip the market on its head again — the bidirectional EV charger.

An electric vehicle’s battery is an underused asset. As a portable energy storage system (ESS) with a much bigger capacity than the stationary ESS sold today, it makes sense to tap into the unit when it’s just sitting in the garage. The hardware that would allow that to happen, the bidirectional EV charger, should begin hitting the market in earnest later this year or early 2024, and solar installers would be smart to get involved with EVs now, as residential customers begin to understand the preferable economics, said Shawn McLaughlin, CEO of home energy management company Emporia Energy.

“It’s much more cost-effective to use your car [as a home battery]. The battery cost is underwritten in the purchase of the car,” he said. “When you look at a home battery system, it costs over $1,000/kWh to install. Leveraging your car battery with a bidirectional charger will cost closer to $50/kWh installed. That’s a big deal.”

The opportunity

A bidirectional charger both charges an EV’s battery and exports its power into a home or onto the grid. This vehicle-to-grid (V2G) and vehicle-to-home (V2H) power transfer is also collectively known as vehicle-to-everything (V2X). EV chargers installed today are unidirectional and only transfer power to the battery. Three things are preventing V2X from being a more valuable option: 1) EV brands have to allow the dual power flow, 2) more bidirectional chargers have to be certified and manufactured, and 3) utilities and grid operators have to understand (and compensate) this new distributed energy resource.

Interest is piquing though. When Ford announced its electric F-150 Lightning’s 131-kWh battery could be used as home backup through its “Charge Station Pro and Home Integration System,” the general public took notice. GM soon announced it was testing V2X capabilities, and companies like Emporia, Wallbox and Enphase are working on their own bidirectional EV chargers.

V2X software developer Fermata Energy was the first bidirectional charger company to have UL 9741 certification, the standard that covers bidirectional charging equipment and includes functionality to export power to the grid. Fermata’s FE-15 charger was recently joined by Ford’s charger (made by Siemens) as the only two on the market to have UL 9741 certification. Fermata’s FE-15 charger is also the only one approved to work with the Nissan LEAF, the first mass-produced EV in the United States.

Fermata Energy CEO David Slutzky said the market opportunity for V2X is huge — not only for EV drivers wanting emergency backup or compensation for grid participation, but also for utilities and grid operators seeking to gain access to a large network of dispatchable energy assets.

“V2X is enabling the extraction of multiple value streams from parked electric vehicles and presenting them to different customers to enable those vehicles to suddenly become more cost-effective as assets to enable an accelerated deployment of renewable energy on the grid,” he said.

While the benefits to EV owners are more obvious, grid operators tapped in to V2X would get a big energy resource without having to build or maintain a site. As an example, almost 200,000 Nissan LEAFs have been sold in the United States since 2011. With a 40-kWh battery coming standard in the 2023 LEAF, one could estimate almost 8 GWh of battery capacity sitting in garages from LEAFs alone. In comparison, the United States has spent billions of dollars over the same time period to reach 13.4 GWh of stationary energy storage capacity. Add Teslas, Chevy Bolts, Ford F-150 Lightnings and more to the equation and you can finally understand the grid benefits of V2X, Slutzky said.

“V2X will not displace stationary storage, but it will surround stationary storage and provide enormous additional storage,” he said. “A Nissan LEAF has 4.5 Powerwalls under the hood, and they came free with the leather seats and air conditioning. The Ford F-150 Lightning has more value under the hood in storage than the cost of the vehicle, literally.”

What still needs to be done

While interest is high, the industry still has to tackle the three setbacks mentioned above to get V2X moving. First, EVs have to allow their batteries to be used in a dual-flow situation. Until recently, EV companies were not comfortable with batteries cycling through usage outside of normal driving. Now EV warranties are better reflecting battery usage in V2X situations, and Slutzky said EV models hitting the market today have bidirectional tap-ins.

Bidirectional chargers have been slow to develop because the technology is obviously more advanced than what’s in a unidirectional EV charger. A more powerful inverter has to be installed to allow for the AC-to-DC power exchange and back again. That dual power transfer generates heat, so more fans and higher-rated enclosures have to be used. Automatic transfer switches must be included if the vehicle wants to work with the grid. Add in software developments to ensure the consumer can use the charger like any other smart device and the utility can access that power, and suddenly you have a much bigger and more complicated product to manufacture.

That’s what Emporia Energy is learning. The home energy management company makes smart plugs, energy monitors, ESS and traditional EV chargers and announced in early 2022 it would make an affordable bidirectional charger. McLaughlin said the company is working through certification and testing and is hopeful that the Emporia V2X Charger will hit the market in 2024.

“It’s a lot more than a Level 2 charger, when you think about the power conversion and the heat it generates. Then the need for an automatic transfer switch, and you’ll need an energy monitoring system to detect when the grid is down. Then you throw in IEEE (Institute of Electrical and Electronics Engineers) voltage control standards,” he said. “All of these things just stacked. It all adds up.”

Perhaps most important is getting utilities tuned in to the benefits. That’s where companies with grid functionality software will have a leg-up. Emporia is well-versed in helping customers participate in grid programs, and Fermata would actually prefer to be the V2X software provider other bidirectional chargers use. Fermata has already worked with different utilities to devise new monetization mechanisms to access V2X’s value streams. The company’s V2X software is allowing an EV used by Burrillville, Rhode Island, city employees to send power back to Rhode Island Energy (formerly National Grid) and get compensation through the ConnectedSolutions program. Another Fermata setup in Boulder, Colorado, reduced peak power demand on a city building and saved the city an average of $270/month — approximately the monthly payment for the Nissan LEAF.

“Most people today are thinking about V2H as backup power and that’s because of the Ford Lightning. Once people understand that we can produce energy savings on our utility bills through grid parity, that’s going to change pretty quickly,” McLaughlin said. “Early adopters will buy for backup, and then when they can reduce their energy bill by 50%, word of mouth will spread. Within the next three or four years, the majority of use will be managing energy efficiency and savings during grid parity vs. just using during grid outages.”

Where the solar installer fits

An EV charger installation is not plug-and-play, and contractors familiar with electrical hookups will be needed to equip more homes and businesses with the bidirectional product. If solar installers know how to install an ESS or a solar inverter, they can install a bidirectional charger.

“Installing a bidirectional charger is similar to installing solar + a battery inverter. Installing a bidirectional charger may be a little easier because you’re not dealing with big, heavy battery modules,” McLaughlin said. “Of course you’ll have to install it where it can access the EV, but the actual electrical work will be very similar but a little less complex than batteries.”

Some solar contractors are already looking ahead. Kevin Nickels, VP of sales for residential installer Nickels Energy Solutions (NES), said his crews are looking forward to bidirectional EV opportunities hitting the market. With more customers wanting energy storage but not comfortable yet with its pricing, Nickels said bidirectional charging could change their sales conversations.

“On almost every customer interaction, the topic of energy storage is coming up. People want it, but then there is some sticker shock that quickly follows the quoting conversation,” he said. “The thing that excites me about the bidirectional EV charger is you’re going to be tapping into a way larger battery. The fact that EV chargers will be less expensive [than a stationary ESS] and you’ll be able to tap into way bigger batteries, it feels like the better solution for homeowners.”

Nickels also believes bidirectional charger installation will keep NES busy during the off-season solar months in upstate New York.

“I don’t want to have a massive team because in the winter we really do slow down,” he said. “But if EV chargers become a really common thing for us, that would be a perfect winter work scope.”

McLaughlin believes the bidirectional EV charger installation market will increase solar opportunities for contractors.

“I think the majority of bidirectional installs will be done by folks that don’t have solar systems. The EV market is enormously bigger and is growing much faster than the solar installation business. You’ll have a lot of opportunity as a solar installer,” he said. “Your introduction to the customer will be with a bidirectional sale and install. A lot of those customers will be natural customers to install solar either at the time of the bidirectional or you will be able to upsell them to solar in the future.

“As a solar installer, it’s going to be a great opportunity to add additional revenue streams and build out an additional customer base for future solar installs,” McLaughlin continued. “Constant customer acquisition is so expensive, so to be able to resell to existing customers is going to be so much more profitable.”