UK draft rules offer carmakers credits for grid-feeding EV tech

The UK government is drafting rules that would reward car manufacturers for installing technology that allows electric vehicles to send electricity back to the national grid. This proposal forms part of a broader review of the zero-emission vehicle mandate currently under consideration by ministers.

The technology, known as vehicle to grid or bidirectional charging, enables drivers to charge their cars automatically when electricity costs are low during overnight hours. The system then allows owners to sell a portion of that stored power back to the grid during periods of high demand. Ministers view this capability as a potential solution to balancing the grid when wind and solar generation falls short of consumer needs.

Under the plan, manufacturers would earn a credit for each car equipped with this technology. This credit would offset the number of petrol cars they can sell without facing fines for missing zero-emission targets. The government consultation on these measures closed on Friday, October 23, 2026.

Environmental groups warn that the incentives could produce a perverse effect. By allowing manufacturers to trade credits for the installation of grid tech, the rules may permit the sale of additional polluting petrol models in the coming years. The government is preparing to lower electric vehicle sales targets under the current mandate. Environmental organizations estimate that such changes could result in an additional 147 million tonnes of carbon emissions released into the atmosphere by 2050.

Ben Nelmes, chief executive of the thinktank New AutoMotive, argued that the current proposal rewards manufacturers for fitting the technology rather than for its actual use. He stated that one or two extra credits, worth approximately 4,000 pounds each, would give manufacturers thousands of pounds per car. Nelmes noted that the hardware costs only a few hundred pounds to install. He added that few drivers own the expensive chargers required to utilize the system, meaning shareholders benefit more than consumers.

Vicky Edmonds, chief executive of the Electric Vehicle Association England, described it as too early to grant manufacturers credits for a technology that has not been tested at scale by drivers in real-world conditions. She pointed out that while millions of electric vehicle drivers exist in the UK, only a small fraction currently use grid or storage technologies. Edmonds emphasized that consumers are still focused on immediate concerns such as vehicle purchase costs, charging expenses, and daily utility.

Some drivers already participate in similar schemes through companies like Octopus Energy in the UK, Renault in France, and BMW in Germany. Octopus Energy claims that drivers using its service could save 620 pounds per year. Smart charging tariffs, which do not require bidirectional hardware, also help manage grid load by encouraging owners to charge when electricity supply is abundant and cheap.

The National Energy System Operator, which balances Great Britain’s grid, projects that vehicle to grid electricity could reach the equivalent of a power station by 2030. This capacity could provide 1.2 gigawatts of power on demand. The operator forecasts that this figure could grow to 41 gigawatts by 2050, a volume sufficient to meet more than a quarter of peak energy demand.