Utilizing battery storage devices in plug-in electric vehicles (PEVs) for grid support using vehicle-to-grid (V2G) concept is gaining popularity. With appropriate control strategies, the PEV batteries and associated power electronics can be exploited for solar photovoltaic (PV) impact mitigation and grid support. However, as the PEV batteries have limited capacity and the capacity usage is also constrained by transportation requirements, an intelligent strategy is necessary for an effective utilization of the available capacity for V2G applications. In this paper, a strategy for an effective utilization of PEV battery capacity for solar PV impact mitigation and grid support is proposed. A controllable charging/discharging pattern is developed to optimize the use of the limited PEV battery capacity to mitigate PV impacts, such as voltage rise during midday or to support the evening load peak. To ensure an effective utilization of the available PEV battery capacity when used for travel (which is the main usage of the PEVs) or when interventions in the charging operation is caused by passing clouds, a strategy for dynamic adjustments in PEV charging/discharging rates is proposed. The effectiveness of the proposed strategy is tested using a real distribution system in Australia based on practical PV and PEV data.