About 6 million electric vehicles are on American roads, and roughly 1 million of them can already export power back to the grid. A typical one sits parked about 95 percent of the day, plugged in for 12 to 14 hours while needing 2 to 3 hours of charge. Texas still meets most of that capacity as load.
That works out to roughly 10 gigawatts of export capacity. In ERCOT the value of tapping it splits three ways, because transmission and distribution utilities own the wires, competitive retailers sell the electricity, and generators sell the power. A TXU Energy customer in Oncor territory can collect free overnight charging from the retailer and a separate rebate from the utility, with nothing combining the two.
On this episode of the Energy Capital Podcast, Matt Boms talks with Joseph Vellone, chief executive of ChargeScape, the vehicle-grid venture owned by BMW, Ford, Honda, and Nissan, about what it takes to move a parked car from load to capacity. The core argument: the hardware is arriving on its own, and what holds the resource back is incentive design and interconnection policy.
For years EVs have been cast as a threat to grid stability. Vellone calls that a misconception and points to record adoption without failure: “we haven’t brought the power grid down.” During the episode, Boms and Vellone work through:
Split incentives in ERCOT, why a deregulated market gives the wires company, the retailer, and the generator each a reason to pay an EV driver and none of them a reason to coordinate.
Grid-parallel interconnection, the argument that a vehicle backing up a home without exporting to the grid should not need an interconnection agreement.
V1G, V2H, and V2G, the three tiers of vehicle-grid integration, what each requires in hardware, and which are running commercially today.
The lease-return wave, Cox Automotive’s forecast of 300,000 EVs coming off lease in 2026 to second owners more price-sensitive than the first.
How the Public Utility Commission draws the line between grid-parallel operation and export will shape how much of that parked capacity ERCOT can call on.
Timestamps
00:00 – Introduction: Joseph Vellone and ChargeScape
02:34 – Why competing automakers built a shared platform
05:49 – When an EV becomes a grid resource
07:35 – V1G, V2H, and V2G in plain English
10:48 – Six million EVs and 10 gigawatts of export capacity
12:07 – The consumer progression to bidirectional charging
15:57 – Texas incentives and what moves customer behavior
18:07 – The changing profile of the American EV driver
21:04 – Policy barriers: unstacked value and interconnection queues
24:58 – Splitting EV value across ERCOT wires, retail, and generation
28:00 – Grid-parallel interconnection at the PUCT
30:05 – Scaling from pilots to full market participation
32:50 – Secondhand EVs, multifamily, and fleets
37:15 – Why record EV adoption has not strained the grid
Resources
People & Organizations
Matt Boms (LinkedIn)
Joseph Vellone, CEO of ChargeScape, previously North America head at ev.energy and a consultant at Boston Consulting Group (LinkedIn)
ChargeScape (Website)
Energy Capital (Podcast - LinkedIn - Apple Podcasts - Spotify)
Company & Industry News
BMW, Ford and Honda Agree to Create ChargeScape, the 2023 agreement forming the joint venture, built on the Open Vehicle-Grid Integration Platform
ChargeScape Welcomes Nissan to Its Alliance of Automakers, making Nissan an equal 25 percent investor alongside BMW, Ford, and Honda
PUCT Project No. 54233, Technical Requirements and Interconnection Processes for Distributed Energy Resources, the rulemaking covering new 16 TAC 25.210, amendments to 25.211, and the repeal and replacement of 25.212
Vehicle-Grid Integration Council comments in Project No. 54233, addressing grid-parallel bidirectional charging and the V2G DC and V2G AC configurations
Transcript
Matt Boms: Hi, everyone. Today we’re joined by Joseph Vellone. He’s the CEO of ChargeScape, the automaker-backed company helping turn electric vehicles into flexible grid assets. Joseph has spent more than 15 years at the intersection of energy and technology. Before ChargeScape, he helped launch and scale the EV charging platform called ev.energy, and advised utilities and energy companies at Boston Consulting Group. His career began in clean energy research, including work on hydrogen fuel cells. Joseph, thanks so much for joining us today and being on the podcast.
Joseph Vellone: Thanks for having me, Matt.
Matt Boms: Of course. I wanna jump into your origin story a little bit, and if you could help us understand how you got to where you are today, and maybe just giving us a quick intro to ChargeScape.
Joseph Vellone: Yeah, sure. So I have been interested in clean transportation since I was in high school. I grew up in the New York City metro area and had an incredible opportunity to actually do some research at the Columbia University School of Engineering on hydrogen fuel cells, which I’m dating myself here, but back when I was in high school, hydrogen fuel cells were actually the promising clean transportation technology at the time. This was well before, uh, Tesla or any other EV manufacturer came onto the scene. So after doing that research in high school, continued studying clean energy and energy policy in college, actually worked for the United Nations right out of college, doing a bunch of different work, including some energy and poverty alleviation work, where really access to affordable clean energy made me realize it’s so fundamental to economic development no matter where you are in the world. So went and did a master’s in energy economics after that, ended up in management consulting, as you mentioned, consulting for some of the world’s largest energy companies, including power utilities. Back at the time, distributed energy resources were first starting to pop up onto the grid, so helping them kind of navigate things like solar and batteries. And then actually left the Boston Consulting Group to join a couple of colleagues at a brand-new startup called ev.energy, as you mentioned. They were quite early. This was, uh, back in Europe, actually, when, uh, EV adoption in Europe was a bit ahead of the United States and sort of building a smart charging platform and then left to come and run ChargeScape a couple of years ago.
Matt Boms: Awesome. Thank you for running us through your story, and it’s an interesting journey that you’ve had to get to where you are today. Can you help listeners understand more about ChargeScape and the company’s mission and the role it’s playing right now in EV charging? I think you’re really at the inflection point of what’s going on right now with electric vehicles across the country.
Joseph Vellone: Yeah, absolutely. So ChargeScape’s mission is to unite automakers and utilities and their shared customer, which is the EV driver, to make electric transportation simple, scalable, affordable, and reliable. And now what that means in practice and, like, what ChargeScape does is we operate this software platform that is the connective tissue between power utilities across North America and electric vehicles on American roads and in American driveways. And so we’re this platform that essentially allows electric vehicles and the power grid to talk to each other. Something that I think makes us very unique in this space is that we are an automotive joint venture. So a lot of other companies is— in this space are venture capital-backed. We’re very different. We’re a joint venture of automakers, actually competing automakers, who pooled their money together to build this common platform for the industry. And so what that means is we have this unparalleled access into automakers’ boardrooms across the country, across the world. We work hand-in-hand with them on vehicle grid integration. It also just means that we are really well-capitalized and kind of provide, like, a stable partner to utilities looking to do this long-term.
Matt Boms: That all sounds really interesting, Joseph. I want to really dig in on ChargeScape and how you’re working with these auto companies right now, really at the intersection of utilities and EVs, as you mentioned. So can you run us through why the platform is backed by automakers? Because I think you mentioned that really briefly, but I think it’s important to emphasize how different the company is and kind of the origin story there of how you started partnering with these different auto companies.
Joseph Vellone: Yeah. So why did automakers pool all of this money to form ChargeScape? Well, a couple of reasons. You know, firstly, they formed ChargeScape to sell more electric vehicles. Their goal as automakers is to sell cars. Now, electric vehicles have something kind of unique about them, where their fuel costs can be a lot cheaper than a combustion engine vehicle. And there’s this additional potential to unlock more savings for the consumer, the EV driver, through smart charging. So anything that ultimately lowers the total cost of ownership for an electric vehicle is gonna help an automaker sell more cars. So it’s very much a strategic play. Now, why doesn’t each automaker just do this themselves? Well, there’s this many-to-many problem. An automaker doesn’t want to partner and contract with dozens or hundreds of power utilities across America to make sure that their customers have access to smart charging and smart charging savings. And at the same time, a utility doesn’t want to contract with the 10 to 20-plus automakers selling cars in the United States and have different contracts and APIs with each one. So ChargeScape really kind of serves as this common platform, solving that many-to-many problem.
Matt Boms: I’m happy that you’re getting into this because that’s really the meat of the conversation I wanted to have with you today, which is: When does an electric vehicle stop being simply a source of new demand and become a useful resource for the grid?
Joseph Vellone: Yeah, the answer is the moment that that EV is plugged in and connected to ChargeScape. So data from our platform shows that a typical EV is parked for about 95 percent of the time. It’s only mobile 5 percent of the time, and most drivers only need about a few hours of charging per night. So more data from our platform, you know, typical EV is, is plugged in somewhere between 12 to 14 hours at a time, but only requires 2 to 3 hours of charge on average. So that gives us a very long window in which to kind of optimize when those 2 to 3 hours of charge gets delivered. And when you think about also like the size of an EV battery, you know, they’re well above 50 kWh, some of them larger than 100 kWh, which is several times larger than a typical home battery. So just being able to, you know, number one, kind of shift when an EV charges, when it’s plugged in, can deliver really meaningful value to the power grid. And then when you actually unlock bidirectional charging and actually connect that EV back into the grid and export electrons from the battery to actually power the grid, it essentially turns an electric vehicle into a little mini power plant on wheels.
Matt Boms: Yeah, and that’s really exciting for nerds like me who track these issues really closely and are looking forward to the day where we have millions of electric vehicles juicing the grid. Let’s get into the weeds a little bit. So there’s a whole bunch of acronyms out there. We’ve got V1G, V2H, V2G. There’s a, a whole alphabet soup that I’m hoping you could help us understand for the average listener that maybe just isn’t familiar with all the technicalities of bidirectional charging. But start from the beginning and then maybe get a little more granular. Are most of these EVs bidirectional? Because I remember a few years ago we were getting there, but there were still plenty of electric vehicles that didn’t have that capability yet.
Joseph Vellone: Yeah, great questions. So actually, maybe let’s break down these terms into plain English to start. So V1G, just an acronym for managed charging, and that’s the very simple technology of just optimizing the vehicle’s power draw a little bit to align with the power grid’s needs. So that could be maybe just delaying when a vehicle starts charging because it doesn’t need to start charging immediately to still get the battery charged to where the customer needs by the time they need it. It could also mean it’s charging immediately, but maybe reducing its power draw slightly so it’s a longer charge session at a lower power, or maybe even temporarily pausing charging for a little bit if the grid is kind of really overloaded. So think about a hot afternoon in the summer when there’s a lot of air conditioners running. That’s V1G managed charging. You mentioned V2H. That stands for vehicle to home. So this is where you’re actually using your car as backup power for your home. So instead of buying a generator, you’ve actually got this really big battery inside of your car that can power your home for days. And so quite a few automakers, including Ford and their F-150 Lightning, have rolled out vehicles that are capable of vehicle to home. And so this is actually, in a lot of ways, kind of one of the emotional gateways for the EV driver to kind of start smart charging. It’s the idea of having resilience to blackouts, and we’re doing this in many parts of the country, including in the Pacific Northwest with Puget Sound Energy, where, you know, they experience both winter storms and summer storms, and the utility’s really interested in increasing customer resilience to blackouts. Blackouts are just a part of life in the United States. I think anyone who grew up here, you know, has experienced power outages before. And sometimes they, you know, they can last a while. They can last hours or days. And to the extent that a customer’s already bought a vehicle, they’ve already got an asset that can provide backup power without the need for an additional generator. Then finally, V2G stands for vehicle-to-grid. That’s what I was describing before, the actual export of electrons from the EV battery, not to the home, but back into the power grid, essentially selling electrons back into the power grid. And this probably the earliest stage kind of technology, but it is real. It’s happening today. We’re doing it currently in, in Silicon Valley. We’re using EVs to actually power data centers, and so this is probably the furthest away. It does require, you know, some special hardware, some special interconnection with the grid. But we do think it’s gonna be actually increasingly commonplace toward the end of the decade.
Matt Boms: That’s great. And we’re getting to the point now where the EVs are really penetrating the market. Like here in Texas, in the next 5 or so years, I think we’re gonna hit the 1 million mark of, uh, EVs on the road. So there’s huge potential when you do the napkin math and add up all the potential gigawatts of power that might bring to the grid.
Joseph Vellone: Yeah, and just to make that math real, there’s about 6 million EVs on the road in America today. About 1 million of those already have that bidirectional power capability. So you think about a million EVs with, you know, maybe a nameplate capacity of 10 kW of power export, that’s 10 GW of power, which is the equivalent of 10 nuclear power plants. So imagine, you know, we’re talking about building new power plants for data centers and stuff, and nuclear power plants can take decades to actually build and cost billions and billions of dollars, but we’ve actually got all of that energy potential just kind of sitting idle in American driveways and on American roads today that we could be tapping into.
Matt Boms: Yeah, for sure. These are just batteries on wheels. You mentioned the Puget Sound program, and I know there’s a few other programs that we could talk about across the country that are really promising. I think we can get into those, Joseph, and I think it would really help the listener understand from a practical standpoint what’s happening on the ground. But the first question I have for you on this would be, is it crawl before you can walk? Because you just walked us through 3 really practical examples of how, uh, EVs could help power up the grid. But do we first need to figure out, you know, how we use these things to back up our homes and businesses and then move on to the V2G, V2X, and all the fancy technologies?
Joseph Vellone: I think it depends on what perspective you’re looking at this from. I think what we see from the average American consumer is there is that kind of natural transition that they go through, right? I think, you know, first of all, just buying an EV in the first place feels like a big first step for a lot of Americans, and we’re getting there, and there’s more EVs on the roads than there ever have been in America that are on the roads today, and just kind of overcoming, right, that kind of emotional hurdle of, “How do I charge, and how do I charge at home, and what happens on a road trip?” Then as people start to get a little bit more comfortable, they become comfortable with the idea of, you know, having their automaker kind of optimize their charging at home, especially if it’s gonna save them money. And we’re talking about Texas here, so I would be remiss if I did not talk about our free EV miles program with TXU Energy across Texas that offers, uh, TXU customers unlimited free at-home EV charging that they do on this plan. And so that just requires a little bit of scheduling, making sure that you’re charging your EV during the hours of 10 PM until 1 PM the next day, so you have a very long window to play with there. That’s usually a pretty clear financial decision for a consumer to make, right? If they’re going to get free charging, the idea of just like setting a schedule or letting their automaker kind of maybe delay charging for a few hours to align with off-peak hours, if that means, again, they’re going to get free charging or a lot of cash back maybe from the utility. You know, we run another program in New York, which is— it’s a very different program. It’s with Con Edison. You know, their customers get cash back for every kilowatt hour of charging they do off-peak. And we have customers who are earning over $1,000 a year in cash just for doing that. So that’s kind of like the first step as a consumer, and then you start to get comfortable with this idea of managed charging, and maybe you’re living in a part of the country where there are frequent power outages, and you realize that your vehicle can actually serve as backup power for your home. And so there is probably a little bit of electrical work that you need to do to be able to get that EV plugged into your home, the same way you would need to do for a generator. A lot of automakers kind of offer a kit that allows you to do that. You could also have an electrician come and do that. And then you’re starting to get comfortable with actually having a backup power source, draining your EV battery a little bit to power your home, provide that backup resilience. We’re starting to see, you know, some Americans get comfortable with is, “Okay, well, there’s not a power outage right now, but I know how it works in terms of draining my EV battery. I know what I’m comfortable with as, as a consumer. I know that I never want my battery level to go below, I don’t know, 30 or 40%. There’s usually quite a few kilowatt hours to play with. I could actually sell a little bit of power back to the grid, right? And I’m gonna sell it back when power prices are really expensive, and then I’m gonna have my automaker charge my car when power prices drop later.” I’m actually gonna engage in some energy arbitrage that you don’t need to be sophisticated to do because through ChargeScape, your automaker is kind of doing that for you behind the scenes. And that’s kind of the progression that we see the consumer go through, and we also see a lot of power utilities, the power utilities that we work with across the country. When they’re kind of launching propositions and programs for their customers, they go through kind of like a similar phase of, let’s start with just the basic managed charging first. Let’s get the consumer comfortable with backup power, and then let’s actually start to do vehicle-to-grid.
Matt Boms: Absolutely. And the Texas customer is extremely savvy because there are a bunch of different factors, but the fact that we have competitive retail choice, we deregulated our energy market back in 2002. Winter Storm Uri certainly plays a factor in that when you’re talking about blackouts and folks wanting to have backup power. The fact that millions of Texans are now looking at, uh, residential batteries as potential source of backup power, but now EVs are kind of entering the scene as this new alternative way to back up your home. So when you speak about these programs, Joseph, that ChargeScape is currently offering, what are the incentives that you’ve noticed actually move the needle and actually encourage customers to shift their behavior? Because one thing you said really caught my attention, which is most people don’t want to be bothered. Their vehicle can be charged at 9:00 PM or 3:00 AM or whatever it might be, as long as they wake up in the morning and they’ve got their battery juiced and ready to go. So is it simply just taking that away and allowing the retail provider to manage the charging, or what’s been kind of the silver bullet here for getting customers enrolled in these programs?
Joseph Vellone: Yeah. Look, as you mentioned, Americans are very savvy, very financially motivated, and so it all comes down to the financial incentives. That’s what we see time and again in every state from the South in Texas to New England, where we work with Eversource Energy in Massachusetts and Connecticut. And generally, like, the programs that are most successful offer customers a very kind of like reliable financial incentive, and that can take different forms. So I mentioned free EV charging in Texas. Yeah, really easy to understand. You knew as a consumer when you plug in at home and you plug in during those hours, you’re never gonna pay for EV charging. Super simple to understand. Similarly, in New England, we run programs with Eversource Energy across Massachusetts and Connecticut, where customers get like a very sort of predictable $25 monthly incentive, and that’s paid as cash back to them in their Venmo account at the end of every month. And they know that if they allow the, the automaker to just kind of optimize their charging at home within certain parameters, they’re gonna get that financial incentive. That’s generally what we’ve seen work best.
Matt Boms: Yeah, it makes a lot of sense. And for the typical American EV driver, has that changed since you started working in this industry? Like, when you first set out there, I think there was a certain image of, like, who drives an EV in America. From my point of view, that has changed a lot over the past several years, but how have you seen it? What does a typical ChargeScape customer look like these days?
Joseph Vellone: Yeah, great question. And, you know, having operated in this industry for almost a decade now, it’s been really interesting to kind of see the evolution of the EV consumer across this adoption curve. So, you know, I think when EVs first came to market, we saw these early adopters, right, who skewed very affluent, very tech-forward, tech-savvy, tend to living, be living in single-family homes. But now, I think following the EV tax credit and also just the wave of secondhand EVs that we’ve seen hit the market, EVs have become much more mass market. You know, the average consumer looks a lot more like the median American household.
Matt Boms: Yeah, and I think there was concern around the EV tax credits and thinking that folks would stop adopting the technology. But I think what we have seen is, like something you mentioned, that the more folks use the technology and get used to it, the more they’ll adopt it. I think the same thing with the charging element, which is like you get comfortable with it as you use it. We saw something similar here in Texas, Joseph, with smart thermostats, where there was a concern that Texans wouldn’t give away control of their thermostats because of privacy concerns and, like, not wanting the retail provider to have access to their smart thermostat. But actually, when you look at the numbers, it’s— those programs have been really successful because of exactly what you’re saying, which is if the financial incentive is there, then absolutely folks will be willing to participate if it ends up saving them money at the end of every month.
Joseph Vellone: Yeah. And I think the other critical thing is keeping the consumer in control. So in a smart thermostat program, if it’s hot, it’s summertime, and you start to get warm inside your house, you can override it, right? And you can, like, turn the AC on. Similarly with smart charging, automakers allow the consumer to opt out or temporarily override a smart charging schedule to charge now whenever they need it. So of course, even when managed charging is happening in the background, there are certain parameters that are always respected, right, which no matter what, no matter how little flexibility we may have in a short window, we’ll make sure your car is charged fully to the battery level you specify by the time you need it. But we’ve seen time and again, EV drivers will set a smart schedule, thinking that they have until the next morning, and then something comes up. Suddenly they’ve got to go pick their kid up or, you know, they need to go run an errand soon, and they need a quick charge. And so there is always that button that the automaker offers to override. So maintaining that element of customer control, I think psychologically is so important for broader scale participation.
Matt Boms: Yeah, it absolutely is. And I want to jump into the policy a little bit with you because we talk a lot of energy policy on this podcast, and I think our listeners are comfortable with getting in the weeds a little bit on this. I just want to know, like from a bird’s eye perspective, what needs to change? Like, what are you seeing, not just in Texas, but across the country when it comes to whether it’s utilities that are maybe reluctant to adopt these programs? Is there some policy switch that can be made to really encourage folks to enroll in these programs? Like, do you see it as a policy challenge, or is it more of a cultural challenge that we’re facing?
Joseph Vellone: I think it’s more of a policy challenge than anything, and kind of thinking about the most common issues that I see in, uh, utility regulators across America. Well, it’s a couple. You know, firstly, this has been eye-opening for me. Utilities extract different value streams from managed EV charging. There is value that they extract at what we call kind of like the system level, which is like kind of just keeping the system stable and reducing what we call peak demand so that they don’t need to switch on expensive peaker plants during maybe just like an hour or two in the afternoon or evening. There’s also this additional distribution value that EVs can really deliver. I think what’s really interesting about EVs is that their adoption continues to be clustered. I think we talked about like skewed affluent for a while, so more kind of affluent zip codes. That’s changing now, but it’s certainly clustered in more, you know, residential neighborhoods or areas where like a big EV fleet, whether it’s Waymos or Amazon delivery vans are charging. And the power grid is made up of millions and millions of pieces of equipment and wires, and there are certain pieces of equipment within a utility service territory that might get particularly strained, whether that’s by EVs or because there’s also like a big factory or there’s other sources of demand operating on that feeder or that substation, and there’s an additional source of value there that EVs can unlock. So, you know, maybe you don’t need to do managed charging for all EVs across the state. Maybe in a certain, at a certain time, you just need it in a specific pocket of your service territory. So that’s another value stream that EVs can provide. And then there’s additional kind of energy market services in ERCOT, in CAISO in California. I think what I’ve seen is that utilities, as they’re kind of like planning and valuing smart charging, these different value streams are not necessarily kind of coming together and being comprehensively quantified and considered. And so I think that’s a barrier. Part of that just comes back to the way that utilities are organized and structured, and you have kind of these different teams realizing different sources of the value, but not talking to each other. I think another, you know, sort of like major policy barrier is a little bit more on like the bidirectional side. So as I mentioned, you know, if you’re gonna export power back to the grid, just like with solar, you know, you do need to have what’s called a, a grid interconnection. And I think what we have seen is that interconnection processes and pathways vary widely by utility and state, but do tend to take quite a long time. So there’s currently just like a backlog of EV drivers who want to be exporting to the grid, but who are waiting for their utility to approve it. And look, we hear similar stories as well about data centers and data center capacity. There’s this backlog of power generation that we’re trying to get connected to the grid that’s just stuck in a queue. I definitely would like to see, uh, regulators and FERC, you know, do a little bit better to streamline and speed up that process.
Matt Boms: Yeah. I always say that like the technology moves a lot faster than the policy does, and I think this is a great example of that, right? Because technology’s come such a long way in the last 5 or 10 years, but in some ways it feels like the policy is a little bit stuck in the mud. I want to just double down on a couple of things you mentioned, which is, at least in ERCOT, we have utilities that manage the poles and wires, right? So they don’t get any incentive for the stuff that we’re talking about today, which is, you know, managed charging, V2G, deferring the transmission and distribution costs that we have in ERCOT, which are substantial and necessary, right? But if you can deploy EVs or at least manage that charging a little bit better around a substation that you know is overloaded because of, let’s say, data centers coming to town or any other cause of load growth, then why wouldn’t you take that option, right? Like as... For the rate payer, this is a no-brainer because, um, ultimately it’s gonna reduce the energy costs at the end of the month. Like we spoke with someone from NRG on the podcast a couple months ago who mentioned, you know, there are 3 components of the energy bill, and they only control 2 of them because the third one is the T&D cost, right? So ultimately the retail provider has no control there. So I guess all of this is leading to a very complicated question, Joseph, which is like how do you align those incentives? In another region of the country it might be a lot easier because you have a vertically integrated utility. But in our case in Texas, we’ve got the poles and wires companies on one hand and then the generators and the retailers on the other. So is there a way to make those stars align a little bit better?
Joseph Vellone: I think what those 3 different entities have in common is that they serve the same end customer, and that’s the EV driver. And so that’s like the single, you know, kind of connection point between a power generator, a distribution utility, and the electricity retailer. And so how does that all need to come together? Well, these are independent companies operating independently, right? And still there’s a Public Utilities Commission in Texas that kind of unites some of these stakeholders. But I think just, like, really realistically, those different stakeholders are gonna probably continue to operate somewhat independently, uh, for the foreseeable future. But that doesn’t mean that the consumer can’t receive some sort of financial incentive from each one. It’s a little bit disjointed, perhaps, like a little bit more piecemeal than we would see in a vertically integrated state. Like, we work with Duke Energy in North Carolina, where Duke is the power generator. They operate the poles and wires, and they sell the electricity and bill the end customer. So a lot simpler there. But, you know, I, I know for a fact, I believe Oncor and our CenterPoint to the distribution utilities in Texas do operate managed charging programs and smart charging programs. So, you know, you could be a TXU Energy customer living in, in Oncor’s kind of service territory, and you could be getting free EV charging from your electricity retailer and potentially some additional cash back as well from Oncor. Not ideal, right? You would want those incentives bundled together, and I think there’s probably room for that to happen. But, you know, for the time being, Texans, I think, uh, in particular, are very financially savvy and will continue to seek out, like, the financial incentives and the value wherever it is.
Matt Boms: Absolutely, yeah. And, and most people are not tracking these policy issues as closely as we are. There is one going on at the commission being led by Ford on, you mentioned interconnection being an issue, right? So this one would be like, if the EV is operating in parallel to the grid, then why should the customer need an interconnection agreement with the utility? Like, that’s a low-hanging fruit in my mind because if you’re just using this vehicle for backup power, then you’re not even trying to export to the grid, right? There, there should be no reason to, uh, request interconnection there.
Joseph Vellone: Yeah. And we share Ford’s stance on this topic. I’ve talked about it a lot. This is, as you said, low-hanging fruit. There is no clear safety need for interconnection when a vehicle is operating in what we call grid parallel mode, so not exporting to the grid, but just kind of working in sync with the grid to, for example, maybe reduce the household’s total energy consumption and essentially do what like a smart thermostat program would do times 10, ‘cause an EV is a lot bigger, and just to help the grid when it’s needed, right? Take the home maybe off the grid for a little bit, even when there’s not a blackout, to help reduce demand on the grid. If the household is getting compensated for that, it makes a lot of sense for them, and we don’t necessarily see any pressing need to require an interconnection. It’s causing artificially long lines and delays, and it’s also forcing those customers to get in line with the customers who wanna actually export power back to the grid, where there is a legitimate need for a grid interconnection, and it’s delaying them as well.
Matt Boms: That’s right. Yeah. At a time where speed to power is what it’s all about, right? So you need, you need that speed.
Joseph Vellone: Yeah, speed to power and, you know, every utility in America that you talk to and every grid operator is just, uh, focused on more megawatts. How many more megawatts can we get connected to the grid? You know, we’re seeing load growth in this country for the first time in 20 years, largely coming from data centers, and so there’s this kind of like urgency on the one side to like connect more megawatts, and then on the other hand, you have all these megawatts in a queue that desperately want to be serving the grid, you know, who are forced to wait in line.
Matt Boms: That’s right. Yeah. Well, with the time we have left, I want to talk about how you see this playing out over the next decade. I think we’ve made some significant progress across the country. You’ve spoken to several pilot programs that are currently underway in different states under different models, right? Like the vertically integrated utilities, the ones that aren’t. Where do you see this heading? Like, what is it gonna take to scale these programs and go from, you know, pilot programs to full-scale market participant?
Joseph Vellone: Yeah, I think there’s a few things there. Well, firstly, we need to get more EVs on the road, and I think we’re seeing a lot of progress there. Certainly a recent slump in sales, but we do see— start to see those numbers picking back up. So there’s a supply issue and a demand issue, right? And on the consumer side, managed EV charging just needs to start to feel normal, right, to the typical EV driver. And, you know, I think certainly if I forecast out, I don’t know, 4 years to 2030, I do think that something that feels, like, relatively experimental today, it will start to feel, I think, much more normal for the typical American, the typical EV driver, this concept of just your car earning money for you while it’s parked. And, you know, part of that is just, like, getting the consumer enrolled at the point of EV sale or lease. And some of our automakers, including Ford, is already doing that today in their dealerships, which is fantastic. And then there’s also the kind of the behind-the-scenes optimization and the— just the consumer comfort with it. I always like to use the analogy, if you’re an iPhone user, of Apple’s optimized charging feature. That’s something that has become the default for an iPhone charging, right? And you plug it in at night, it gives you a little pop-up, “Optimized charging. Your phone will be charged by, I don’t know, 3:30, 4 in the morning.” Probably looks at your alarm as well and makes sure it’s charged by then. And it just happens in the background while you sleep, and you don’t really care about it. And in that case, I’m not even earning money from it, but I know that it’s helping my battery health, and as a consumer, I don’t really mind. It just sort of becomes second nature. So I think that’s, like, a really big part of it. I think the other part is, you know, again, just this bidirectional charging becoming a little bit more mainstream. So we’re seeing a lot of automakers now bring new cars to market that are bidirectional-capable or rolling out software updates that unlock the bidirectional capability. Tesla’s made announcements there. Rivian has made announcements about over-the-air updates for its R2 fleet of vehicles. BMW’s rolling out bidirectional-capable vehicles starting with the 2027 model year. And then you’ve got the automakers who have been doing it for a while, including GM, Ford, Hyundai. So more and more vehicles that are bidirectional-capable, I think is gonna go quite a ways in getting more megawatts of flexible capacity on the grid.
Matt Boms: Yeah, it’s becoming more of the norm. And how does ChargeScape view the growing pool of used EVs? But, like, how much do you think about the life cycle of these vehicles as far as how do we take advantage of not just the newer ones that are being released, but the used ones that could also serve the grid?
Joseph Vellone: Yeah. We see this kind of wave of secondhand EVs that’s hitting the market now as a huge opportunity for us. So just to throw out some numbers, Cox Automotive forecasts that about 300,000 EVs will return from lease in America this year in 2026. That number will jump to 600,000 next year in 2027 and 700,000 in 2028. And this is all a result of a lot of Americans taking advantage of that EV tax credit loophole, where no matter your income level or the type of EV, you could get the $7,500 rebate essentially applied to your lease and made for a very cheap lease. Those leases last 2 to 3 years, and those cars now are returning to market. And so we at ChargeScape view this as a great opportunity to kind of reengage that next owner of the vehicle, right? They’re probably gonna buy a certified pre-owned vehicle from their dealership lot. This EV driver is almost certainly going to be a little bit more price-conscious and financially sensitive than the one who bought the new $60,000 vehicle. You now have the person buying it for $25,000 and much more likely to sign up for a smart charging program and earn the financial incentives to further reduce the total cost of ownership. So this is something that ChargeScape and our automaker partners are investing a lot of time and money into, and we’re already starting to see it bear fruit today in our enrollment. We’re seeing quite a few secondhand EV drivers sign up for our platform, kind of getting reengaged at the dealership when they’re picking up the keys to their EV.
Matt Boms: Great. And, Joseph, you mentioned earlier that it’s not just about single-family homes, that obviously there’s the multifamily home experience, and we haven’t talked much about, like, EV fleets. So can you speak a little bit to, you know, whether it’s electric trucks or electric school buses, how much does ChargeScape work with EV fleets in general?
Joseph Vellone: Yeah, I’ll start with multifamily. Actually, a third of US households are located in multifamily dwellings like condos and apartment buildings. This is a huge swath of the country, and again, particularly as EVs become more mass market, more and more of those households have got at least one EV in them. And so this is a really important thing for ChargeScape and for our automaker partners who want EV charging savings to be available to all of their customers no matter where they live. And so we’ve already kind of built out capabilities to serve EV drivers who are living in multi-tenant properties and allow them to participate in managed charging programs and enjoy all the same incentives and savings that their single-family colleagues are enjoying. On the fleet side as well, you know, we see this as, like, a really kind of interesting area. Fleets continue to electrify across the United States as companies are making decisions to go electric, if not based on ESG targets, then just based on pure financial savings and operational efficiency. Fleets are a little bit different, right? They typically have shorter dwell times back at depot, and so there’s a little less flexibility to kind of optimize their charging there. But there is still flexibility, and I think a lot of interesting stuff that you can do, particularly on the vehicle-to-grid side when those cars are sitting idle and could potentially be powering back the grid. As a matter of fact, what we’re doing in Silicon Valley with Silicon Valley Power right now is we’ve got actually a commercial fleet of Nissan Leafs that return to depot and export power back to the grid when called upon. So I think a lot of interesting things you could do on the fleet side. And then there’s also this category of fleet called the take-home fleet vehicle that not a lot of people talk about, but there’s actually a lot of cars like that that are corporate cars that the employee actually drives back home and charges at home. And so, you know, they’re paying for that car’s fuel essentially on their own electricity bill. So there’s a reimbursement service that we provide to the EV driver, but then there’s also the additional savings that we can offer back to the company who owns and ultimately pays for the charging by smart charging that vehicle at home.
Matt Boms: Very cool. Yeah, that’s all really exciting, and I want to leave you, I guess, with one futuristic question before we wrap up. If you could leave our listeners with one idea about the future of EVs and the grid, what would you want them to understand?
Joseph Vellone: I think for a number of years, EVs have been painted as a threat to the stability of the power grid, and I think that’s a fundamental misconception. I think what we’ve seen in the past few years with record levels of EV adoption is that with more and more EVs on the road reaching 6 million-plus, we haven’t brought the power grid down. The power grid is still stable. It’s still standing. And as a matter of fact, part of the reason why it is still stable and still standing is because of EVs. EVs are this great flexible resource. They’re batteries on wheels, and they can actually play a role in helping keep the power grid stable. And if the EV driver is able to save money on their charging as a byproduct of that, even better.
Matt Boms: Awesome. Thank you so much, Joseph. Really appreciate your time today and walking us through all these different concepts and looking forward to having you on again as EVs continue to proliferate in Texas and across the country. So thank you so much, Joseph. Appreciate it. Thank you.
