Joint decision-making and subsidy design for vehicle-to-grid: Facility scale and discharge pricing

Vehicle-to-grid (V2G) enables bidirectional charging and discharging, offering flexible power dispatching to reduce peak load pressure on the power system, providing economic benefits to users, and generating social advantages. Nevertheless, the extensive implementation of V2G faces numerous practical challenges, primarily stemming from the inadequate development of V2G facility scale and the lack of pricing incentives for the discharge market. Consequently, the design of effective subsidy policies to promote V2G has emerged as a critical issue requiring urgent attention. This study constructs a Stackelberg game model to analyze the joint decision-making of discharge pricing and the V2G facility scale under three scenarios of no subsidy, facility subsidy, and discharge price subsidy. The research results indicate that: (1) With the increase in government subsidies, the discharge price decreases; however, as the opportunity cost rises, the discharge price increases. (2) The gap in optimal facility scale under different subsidy policies narrows with the rise of V2G station cost, while the gap in optimal discharge price shows a U shape. (3) Facility subsidy promotes V2G station expansion, while the effect of discharge price subsidy on EV owners is limited by a threshold. (4) Facility subsidy is more effective in areas with low travel frequency but discharge price subsidy proves most effective in high travel frequency area. (5) By extending the analysis to a competitive market, we reveal that competition reduces per-firm infrastructure incentives and lowers optimal subsidy intensity, potentially leading to underinvestment during early development stages. Under such conditions, facility subsidy provides a more stable instrument for sustaining coordinated V2G expansion. This study contributes to a more systematic understanding of subsidy design in emerging energy markets and provides evidence-based guidance for policymakers and industry stakeholders.