FILE PHOTO: COO of EMEA Fiat Chrysler Pietro Gorlier speaks during the ceremony to mark the installation of the first robot on the production line for the new electric Fiat 500 BEV at the Mirafiori industrial complex on the 80th birthday of the plant in Turin, Italy July 11, 2019. REUTERS/Massimo Pinca

TURIN (Reuters) - Fiat Chrysler will set up an experimental fleet of up to 700 electric cars to test vehicle-to-grid (V2G) technology, which allows power grids to use energy stored in car batteries to face demand during peak hours.

FCA is taking its first steps into electric mobility as the Italian-American carmaker moves on from its failed $35 billion bid to merge with France’s Renault, a pioneer in electric vehicles.

FCA on Thursday signed an agreement with Italy’s national grid operator Terna to jointly test a technology enabling electric vehicles to interact with the grid, through charging infrastructure.

The project will include a feasibility study to launch an experimental demonstration fleet of cars connected to the grid via V2G infrastructure to be built in FCA’s Mirafioni plant in Turin, the two companies said in a statement.

“We’ll start with the electric Cinquecento (Fiat car model),” said Pietro Gorlier, FCA’s chief operating officer for the EMEA region.

“The project will kick off in the coming months, we plan to reach 600-700 test vehicles by 2020-21”.

FCA will start producing a full electric version of its Cinquecento mini car in Mirafiori by the second quarter of next year.

Hybrid plug-in versions of the Jeep Compass and Renegade, a new plug-in Alfa Romeo compact SUV, the Tonale, and a mild-hybrid Panda compact car, were also expected in 2020.