The vehicle-to-everything (V2X) market is poised for significant expansion, with total capacity expected to reach 40 megawatts (MW) by 2025, according to a new report by Wood Mackenzie. Electric school buses are leading this growth, benefiting from their large battery capacities, predictable schedules, and extended idle periods, making them ideal candidates for bidirectional energy transfer.
The report, titled Power from the People: The State of the Vehicle-to-Everything (V2X) Market, highlights the potential of V2X technology to enhance grid resilience and create new revenue opportunities. However, key barriers remain, including inconsistent utility interconnection processes and a lack of standardized compensation models for vehicle owners feeding power back into the grid.
V2X adoption remains concentrated among a few US-based companies, with some focusing on commercial and residential applications while others explore multiple segments. In Europe, energy companies are forming strategic partnerships to scale V2X solutions, emphasizing interoperability and regulatory alignment. Growing utility incentives for vehicle-to-grid (V2G) applications are further accelerating interest in the sector.
“V2X technology has huge potential to boost grid flexibility and create valuable new streams of revenue, but it’s still early days,” said Elham Akhavan, a senior research analyst at Wood Mackenzie. She noted that as utilities and regulators establish clearer compensation frameworks, adoption rates—particularly in fleet and commercial markets—are expected to rise.
A growing number of electric vehicles are being equipped with bidirectional charging capabilities, in both AC and DC formats, laying the groundwork for broader V2X integration. However, according to Oliver McHugh, another senior analyst at Wood Mackenzie, significant cost reductions and charging protocol standardization will be necessary for mass-market adoption.
“AC charging is more cost-effective in terms of infrastructure, but DC is currently leading in pilot projects,” McHugh explained. He added that AC charging presents technical challenges due to its reliance on in-vehicle inverters, whereas DC charging functions similarly to solar photovoltaic systems, albeit with its own limitations.
Looking ahead, more passenger EVs launching in 2025 will feature vehicle-to-load (V2L) capabilities, a step toward broader adoption of AC V2X technology. As these advancements take shape, the V2X sector is expected to play an increasingly vital role in balancing energy demand and stabilizing power grids.