Frequency regulation is a major market service to reduce the undesired imbalance between power supply and demand in the power market. In order to participate in the regulation market, both the supply and demand sides need to be capable of flexibly adjusting their power generation and consumption, respectively. As the scale of Internet data centers is increasing rapidly, their significant power consumption has enabled them to become an important player in the regulation market for maximized profits and thus minimized operating expenses. On the other side, Plug-in Hybrid Electric Vehicles (PHEVs) have also recently been identified as a major participant in the regulation market, due to their large power demand for battery charging.In this paper, we propose a novel power management scheme that jointly leverages a data center and its employees’ PHEVs to (1) maximize the revenues that the data center receives from the regulation market and (2) get the PHEVs charged at no expense to their owners. Our scheme features a two-level hierarchical power control design. At the first level, our scheme interacts with the regulation market to provide information about the data center power consumption on an hourly basis. At the second level, the scheme decides the power budgets for the servers and UPS in the data center, as well as PHEVs, in real time, to follow the given regulation signal. In addition, we show how to leverage the thermal energy storage (TES) tanks available in many data centers to adapt the cooling power consumption for better management of the data center power demand and further increased regulation revenues. We evaluate the proposed scheme with real-world workload and regulation traces. The results show that our scheme performs a high-quality regulation service. As a result, the proposed scheme outperforms several commonly used baselines by having higher regulation revenues, and so lower operating expenses, for the data center. Finally, we analyze the cost savings of the PHEV owners, throughout the lifetime of the PHEVs, by getting their batteries charged at no expense.