One of the hottest questions among energy nerds these days has to do with the interaction of electric vehicles and the electricity grid. Will EVs remain passive consumers of electricity, like toasters or refrigerators, the way they are now? Or will they be able to communicate with the grid and send power back to it when needed?

The answer depends on both technology and economics. A new study contains reason for great optimism.

First, some quick background.

Grid nerds hope EV batteries will talk to the grid

If recent forecasts are accurate, the electric vehicle market is about to take off. The latest research on EVs from Bloomberg New Energy Finance (BNEF) — which gets more optimistic every year — now estimates “that EVs will account for 54% of new car sales by 2040, not 35% as previously forecast,” which means that “a third of the global light-duty vehicle fleet will be electrified by 2040.”

That means tens of millions of batteries floating around, storing electricity while the cars aren’t in use and releasing it when they are.

Theoretically, all that energy storage could be very useful to the grid, which needs all the storage it can get in order to integrate more variable renewable energy. It needs big, steady, long-term storage, for monthly or yearly variations in sun and wind, but it also needs fast, responsive, short-term storage, to smooth out smaller variations of seconds, minutes, or hours — to provide “voltage regulation,” “frequency response,” and other grid services (many of which are now typically provided by natural gas plants, which will have to go soon).

The hope among EV enthusiasts is that, when they are not in use (remember, the average car is parked 90 to 95 percent of the time), all those EV batteries will be able to hook up to, and communicate with, the grid. If the grid could communicate simultaneously with thousands or millions of distributed EV batteries, it could treat them as one big virtual battery, capable of storing or producing electricity as circumstances require, serving that vital short-term storage role.

That would both help the grid, smoothing out variations in renewable energy, and increase the value of EV batteries, stimulating EV markets.

It’s called vehicle-to-grid, or V2G, and if it works, it will be a win-win.

From a user perspective, it wouldn’t make much of a difference. When EVs are plugged in — overnight, or while their owners are at work — they would signal to the grid that they are available and the grid would use them to store or produce energy. Since the grid would have thousands of such batteries to work with, the amount of juice added or subtracted to an individual battery would likely be quite small. And of course EV owners would be compensated for making their cars available for V2G, though the business models remain to be worked out.

The economics of V2G are still uncertain, but there’s promising news

There have always been V2G skeptics. The debate can get technical, but the main point of contention is degradation. Running EV batteries on cycles (and for purposes) for which they were not designed will, it is feared, reduce their capacity and lifespan. That loss of value will be greater than the value produced by any services to the grid. V2G just isn’t worth the trouble — or so the skeptics say.

But a study recently released by researchers at the University of Warwick suggests that degradation is not necessarily a foregone conclusion.

After running extensive simulations on a “comprehensive battery degradation model,” researchers developed a V2G algorithm designed to minimize degradation. They found that under the right conditions, a two-way power exchange with the grid could extend a battery’s useful life — specifically, it could “reduce the EVs' battery pack capacity fade by up to 9.1% and power fade by up to 12.1%.”

This is just one study, over a relatively short time period, using idealized V2G conditions. So the jury is still out on the long-term, real-word effects of V2G. (There are numerous pilot projects, many done, many still underway, that will tell us more over time — see here, here, here, here, here, etc.)

But if the study’s main finding holds true in further tests, it will be a very big deal.

Adding 10 percent to the life of an EV battery is a service people would pay for. Adding 10 percent to the lives of tens of millions of EV batteries would be a market-shaking boost to EVs.

That’s unrealistic, of course, since real-world V2G conditions are unlikely to match idealized usage patterns. But one can imagine commercial V2G services developing their own algorithms to minimize degradation, with real-world competition driving rapid learning. If the algorithms get good enough, V2G could even someday be marketed as ongoing EV battery maintenance.

Even if V2G can have neutral or only mildly effects on battery life, it will be a huge boost for EVs. Revenue from grid services will effectively become a free bonus available with an EV, at no extra cost. That will make batteries more valuable, EVs a better bargain, and the market that much hotter.