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Economic Assessment of Using Electric Vehicles and Batteries as Domestic Storage Units in the United Kingdom

Author

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  • Donato A. Melchiorre.
  • Sinan Küfeoglu

Abstract

Increasing residential renewable energy generation and the consumers’ demand for reducing their electricity bills leads to new opportunities to use electric vehicles (EVs) and batteries as domestic storage units. This paper assesses the economic feasibility of Vehicle-to-Home (V2H) and domestic battery systems in the United Kingdom (UK). To do the analysis, a UK average EV and domestic battery have been established; called UKEV and UKBat respectively. The UKEV characteristics were determined by taking a weighted average from the five highest selling EVs in the UK. An arithmetic mean was used for the individual UKBat features based on seven models currently available on the UK market. The UKEV and UKBat were compared under four scenarios. These are Ofgem’s two domestic electricity profile classes (PC1, PC2) and two existing time-of-use tariffs; one with two and the other with three rates during a day. Maximum annual saving for the consumer was estimated to be around 35% and 57% per annual electricity bill for the EV and battery, respectively. On average, for both UKEV and UKBat, the three-rate tariff yielded 30% more savings than the two-rate tariff. Battery degradation cost was the major parameter affecting the economic feasibility of V2H and domestic batteries, but these costs are expected to continue to fall. Suitable time-of-use tariff design is the key to maximising consumers’ savings in using these units.

Suggested Citation

  • Donato A. Melchiorre. & Sinan Küfeoglu, 2018. "Economic Assessment of Using Electric Vehicles and Batteries as Domestic Storage Units in the United Kingdom," Cambridge Working Papers in Economics 1858, Faculty of Economics, University of Cambridge.
    • Handle: RePEc:cam:camdae:1858
    Note: dam69
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    References listed on IDEAS

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    1. Colmenar-Santos, A. & de Palacio-Rodriguez, Carlos & Rosales-Asensio, Enrique & Borge-Diez, David, 2017. "Estimating the benefits of vehicle-to-home in islands: The case of the Canary Islands," Energy, Elsevier, vol. 134(C), pages 311-322.
    2. Küfeoğlu, Sinan & Pollitt, Michael G., 2019. "The impact of PVs and EVs on domestic electricity network charges: A case study from Great Britain," Energy Policy, Elsevier, vol. 127(C), pages 412-424.
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    4. Jamasb,Tooraj & Pollitt,Michael G. (ed.), 2011. "The Future of Electricity Demand," Cambridge Books, Cambridge University Press, number 9781107008502.
    5. Few, Sheridan & Schmidt, Oliver & Offer, Gregory J. & Brandon, Nigel & Nelson, Jenny & Gambhir, Ajay, 2018. "Prospective improvements in cost and cycle life of off-grid lithium-ion battery packs: An analysis informed by expert elicitations," Energy Policy, Elsevier, vol. 114(C), pages 578-590.
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    Cited by:

    1. Küfeoğlu, Sinan & Pollitt, Michael G., 2019. "The impact of PVs and EVs on domestic electricity network charges: A case study from Great Britain," Energy Policy, Elsevier, vol. 127(C), pages 412-424.
    2. Aser Alaa Ahmed & Mohammad A. Nazzal & Basil M. Darras & Ibrahim M. Deiab, 2022. "A Comprehensive Sustainability Assessment of Battery Electric Vehicles, Fuel Cell Electric Vehicles, and Internal Combustion Engine Vehicles through a Comparative Circular Economy Assessment Approach," Sustainability, MDPI, vol. 15(1), pages 1-25, December.

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    More about this item

    Keywords

    electric vehicles; battery; vehicle-to-home systems; tariffs;
    All these keywords.

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities

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