Toyota Tsusho : and Chubu Electric Power Participate in Virtual Power Plant (VPP) V2G Aggregator Project that Utilizes Storage Batteries of PHVs/EVs- Japan's first ever charging and discharging demonstration project from storage batteries of PHVs/EVs -

Toyota Tsusho Corporation (hereinafter 'Toyota Tsusho') and Chubu Electric Power Co., Inc. (hereinafter 'Chubu Electric Power') announce that they will commence their V2G demonstration project today. Both companies jointly applied for subsidies to initiate a 'V2G Aggregator Demonstration Project' as a part of the Ministry of Economy, Trade and Industry Agency for Natural Resources and Energy's 'FY2018 Subsidies for Virtual Power Plant Demonstration Project for Improvement of Energy Management in Demand Side.' On May 29, 2018, the two companies received notification from the Sustainable Open Innovation Initiative, the execution body responsible for approving subsidy applications, that their application had been successful.

VPP is the mechanism that aggregates relatively small Distributed Energy Resources('DERs') such as solar power equipment, batteries, plug-in hybrid vehicles and electric vehicles (hereinafter 'PHVs/EVs') and other power sources at places including homes, and factories in order to produce energy output in utility-scale. Vehicle to Grid (V2G) is one of the VPP technologies that utilize the storage batteries of PHVs/EVs to charge and discharge stored electricity to electrical grids.

The use of renewable energies such as solar and wind, which are influenced by weather conditions, looks set to increase, and there will consequently be instability in the amount of power generated, depending on the time of day, season, and prevailing weather conditions. As a result, both a variability of renewable energy output and surplus power generation will become major issues in the future. V2G technologies provide balancing control power² to adjust the instability caused by a variability of renewable energy output; they can also be used to shift supply capacity by storing surplus power and sending this back to electrical grids at times when there is greater demand for electricity.

This demonstration project is aimed at verifying the feasibility of V2G to provide balancing control power and shift the supply capacity of renewable energies. As part of the project, the two companies will build the V2G control system that groups together multiple in-vehicle storage batteries and manages how they charge and discharge electricity, they will install bi-directional chargers at parking facilities in Toyota City, Aichi Prefecture, and they will carry out demonstration tests. By actually charging storage batteries of PHVs/EVs and discharging electricity from them to electrical grids, the project will evaluate the effects the V2G has on the electrical grids, with the aim of utilizing PHVs/EVs to adjust power supply and demand.

Utilizing the V2G technologies of the U.S. Nuvve Corporation¹, the project will also aim to provide balancing control power in response to short-term fluctuations in power supply and demand, which requires short response times and has a high degree of difficulty.

Through this demonstration project, Toyota Tsusho will establish the V2G control system as an aggregator³ (it is planning to use Nuvve Corporation's V2G aggregation server) and seek to generate new values for PHVs/EVs, such as the supply of balancing control power and shift of the supply capacities of renewable energy sources in electrical grids.

Chubu Electric Power will evaluate the influence of V2G on electrical grids from the perspective of a Transmission System Operator ('TSO'). By contributing to improvements in technologies that lead to the securing of new balancing control power, the company aims to provide electricity in a safe, inexpensive, and stable manner.

Through this demonstration project, Toyota Tsusho and Chubu Electric Power intend to identify new values for electrified vehicles, which are expected to grow in popularity in the future. By further promoting the use of renewable energy sources and electrified vehicles, which have a small environmental impact, the two companies aim to contribute both to the realization of low-carbon societies and to the stable supply of electricity.

¹Nuvve Corporation is a U.S. start-up company operating a V2G projects that utilizes PHVs/EVs all around the world such as in Europe and the U.S. In each project it provides frequency regulation service to each electrical grid. In Denmark, it has succeeded in commercializing the world's first V2G business. Toyota Tsusho invested in Nuvve Corporation in December 2017.

(http://www.toyota-tsusho.com/english/press/detail/171215_004082.html)

²Balancing control power refer to the electricity used by the TSO to adjust supply and demand (frequency control and supply and demand balance control), in order to maintain electricity at a single frequency (of 50Hz or 60Hz). When frequencies fluctuate, the quality of electricity decreases; this risks causing malfunctions in industrial equipment. For this reason, it is vital that electricity grids maintain electrical power at a single frequency. In addition, since the introduction of renewable energies has made the balance of electrical supply and demand increasingly disordered, going forwards it is thought that balancing control power in response to short-term fluctuations will grow in importance.

³An aggregator is a business that utilizes DERs to provide services to power generation businesses, power distribution and transmission businesses, and electricity retailing businesses.