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Electrification as a driver for decarbonization and energy transition

Powering our homes, cities, businesses and transportation systems with electricity generated by renewables is a key strategy in global effort to cut emissions

Published on OCTOBER 29, 2021

What is decarbonization and why is it so important?

Decarbonization is the key to fighting climate change. It is the process of cutting or eliminating greenhouse gas (GHG) emissions by phasing out the use of fossil fuels and switching to renewable sources of energy such as sunlight, wind, and geothermal heat.

Energy transition: process and strategy

The reason why the energy transition is important is because it is a pathway to transform the global energy sector from a system based on fossil fuels like coal and oil, which produce harmful carbon dioxide (CO2) emissions, to a net-zero emissions system by 2050, according to the United Nations.

The European Commission seized an historic opportunity in 2020 to lead on climate change by setting targets for reducing greenhouse gas emissions in the region by at least 55% by 2030, putting it on track to reaching net zero carbon emissions by 2050. To achieve this goal, national governments and companies must work together in an energy transition strategy that gradually shifts from using fossil fuels to renewable energy sources. One of the tools made available by the EU to achieve its net zero strategy is the NextGenerationEU Recovery fund designed to stimulate investment in a resource-efficient economy and promote innovation in clean technology that will advance the energy transition.

Electrification

Electrification

The process driving the energy transition for a sustainable world

At the heart of the energy transition is the need to reduce energy-related CO2 emissions to limit climate change and mitigate its destabilizing impacts such as extreme weather, floods, fires, and higher temperatures that could make some parts of the globe uninhabitable. Air pollution also has a serious impact on health.

Scientists are urging policymakers, communities and businesses everywhere to adopt an energy transition strategy if humanity is to successfully contain global warming to 1.5°C above pre-industrial levels. These strategies involve a process of gradually replacing fossil fuels with renewable energy.

Why does the energy transition take time?

What is electrification

Understanding the benefits of electrification

Scaling up electrification for smarter, more efficient, greener energy usage

The energy transition takes time because it requires harmonization between policymakers and the private sector: legislation, financing and technological innovation must go hand in hand to make the electrification of industry a reality. It will take a substantial increase of capital-intensive clean energy assets – such as wind and solar PV  –  to put the world on a path to achieve net zero emissions by 2050, according to the International Energy Agency (IEA). In its Net Zero Emissions by 2050 Scenario (NZE), the IEA estimates that around 70% of clean energy investments over the next decade will need to be carried out by private developers, consumers and financiers. This also means enhancing access to low-cost financing for new utility-scale solar projects supported by long-term Power Purchase Agreements (PPAs). Companies such as Enel X are doing their share by offering C&I clients a range of options to implement clean energy solutions.

How electrification reduces emissions and stops climate crisis

The energy system has a central role to play in the transition to a net-zero economy. To reduce carbon emissions, there must be a huge expansion in electrification with a simultaneous increase in the decarbonization of energy production.

In other words, electrification, or replacing technologies that use fossil fuels - especially in sectors such as transportation, buildings, and industry - with technologies that run on electricity, is a key energy transition strategy because it speeds up the decarbonization process, thereby curbing the impacts of climate change – especially when the electricity is generated by renewable sources, like sun and wind. Electrifying energy is a way to remove greenhouse gas emissions from energy consumption in many sectors, including in transportation.

In other words, electrification involves increasing the percentage of electricity in terms of total final energy consumption mix. Today electricity makes up around 19% of total final energy consumption, according to the International Energy Agency (IEA), and this figure has the potential to grow massively in future. To reach decarbonization targets and fight climate change, the share of renewable-generated electricity needs to grow substantially. At least 60% of the EU’s economy should be electrified by 2050 to achieve 95% greenhouse gas emission reduction versus 1990 levels, according to the study, “Decarbonization Pathways” by Euroelectric.

 

The role of electrification of final energy consumption involves three fundamental aspects that are important in fighting climate change: decarbonization, energy efficiency, and digitalization:

  • Decarbonization: with electricity, the fossil fuels used to power services can be replaced with electricity generated by renewable sources, reducing greenhouse gas emissions and, as a consequence, atmospheric pollution
  • Efficiency: electrification, when combined with digital technology, is a process that enables the smart and efficient use of energy, ensuring significant savings for the sectors (transport, residential, urban, and industrial) where needs are mostly met by fossil fuels.
  • Digitalization: electricity enables the digitalization of energy uses through the integration of smart technologies and supports the development of innovative products, services, and business models. Digitalization coupled with the electric energy supply can optimize energy consumption and reduce waste.
Our Commitment

Our Commitment

We are leading the change, accelerating the energy transition

Electrification and renewable energy: how they can contribute to decarbonization and energy transition

The main benefits of using renewable energy for electrification are:

  • Cutting emissions, reducing global warming and getting rid of pollution, which in turn improves health, the environment, and quality of life for all: electrification using clean energy from renewables means a better chance at a sustainable future
  • Making our power generation, distribution and storage systems more flexible, resilient, efficient, profitable and secure. A significant economic benefit comes from diversifying the energy supply and reducing dependence on imported fuels, while creating economic development and jobs in the renewable energy sector

 

Electrification powered by renewables is therefore an unprecedented opportunity to foster a clean energy transition: it is an accessible path to an affordable, reliable and decarbonized energy system.