Octopus Energy, partly owned by Australia’s Origin Energy, has launched the UK’s first vehicle-to-grid tariff, offering free charging for EVs if the customer allows the energy provider to utilise their vehicle’s battery to export electricity back to the grid during peak demand hours.

The company says the new smart tariff will save EV owners more than £850 ($A1640) a year in charging costs.

To qualify for the tariff, customers must have their EV plugged into the grid for 170+ hours each month (about 6 hours per day) and stay below the annual usage limit of 333kWh per month, which Octopus says represents about 12,000 miles (19,000 km) of annual driving.

For reference the average Australian passenger vehicle drives just 11,100km per year.

Octopus says its smart tariff platform, Kraken uses advanced data and machine learning to enable the new vehicle-to-grid tariff. The company says the platform has been licensed to support over 50 million accounts worldwide, including Origin Energy, which recently increased its holding in Octopus to 23%.

The new V2G tariff marks a milestone in the transition to clean technology and could be the key to unlocking massive amounts of battery storage, enabling a further acceleration away from fossil fuels.