Massive clean electrification critical to a net zero Europe says Eurelectric
Direct electrification in all sectors, energy efficiency and new clean energy generation must drive Europe’s decarbonisation, Eurelectric’s new Decarbonisation Speedways study advises.
The study, which was undertaken with Accenture, identifies three decarbonisation scenarios, or ‘speedways’, towards net zero by 2050 based on current policies – one on Fit for 55, another on REPowerEu and the third named ‘Radical action’ as an extension of the latter to deliver net zero by 2040.
Along with these are indicative targets across sectors for the interim 2030 and 2040 ‘landmark’ dates as well as for 2050.
With approximately 70% of Europe’s final energy demand in transport, buildings and industry relying on fossil fuels, these are considered the main target for decarbonisation, with the main route in the three scenarios relying heavily on electrification of demand.
Clean electricity is available via renewable energy sources, while efficiency gains lead to a reduction of the total energy needed.
Indirect electrification with e.g. hydrogen is favoured only in hard-to-abate sectors such as heavy industry and transport.
Among the three sectors, buildings see the largest absolute electricity demand, although the largest relative demand growth is in transport.
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Within this sector road and rail largely electrify towards 2050, while in marine and aviation, hydrogen is introduced as an alternative.
Similarly by 2050 light industries largely electrify, reaching rates of 74%, while hydrogen has the more important role in heavy industries, reaching 31%.
Overall the study finds that the share of electricity in final energy demand in 2050 should approach 70%, around 5,000TWh.
Power sector transformation
The study finds that all scenarios call for a strong increase in renewable capacities, with faster rollout of especially solar PV and onshore and offshore wind essential to meet the capacity demand.
The aggregated capacity amounting to an about ten-fold expansion for 2050 is estimated between 2,485GW and 3,287GW, requiring annual growth of over 80GW.
This, in turn, will require between 531TWh and 782TWh of flexibility by 2050 to balance the supply and demand, along with much-increased investment in both the grids and the generation capacity.
For example, grid investment is needed in the upper €30 billions per year by 2030 compared with the low to mid €20 billions in the latter part of the last decade, while generation investment needs to increase by about 50% to reach €80-100 billion per year.
Accelerated decarbonisation
Commenting on the study, Kristian Ruby, Secretary General of Eurelectric in an exclusive interview said that the study was aimed to provide insight into the EU’s accelerated decarbonisation ambition and a “first” to look in detail at the 2040 milestone and where the region needs to be then based on today’s policies.
“To be climate neutral by mid-century, 2040 is a natural milestone on the way,” he says, pointing to several reasons, including the discussions around carbon budgets becoming increasingly important and the implications for power sector investments after 2030 and whether these should continue essentially business-as-usual or there should be significant ramp-up, “which is what we are finding”.
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Key also is the opening of discussions by the EC on 2040 targets as a requirement for international reporting purposes.
Turning to the headline findings of the study, Ruby says there are three to highlight, with the first that it confirms that “electricity and electrification is an indispensable part of any credible and cost-efficient decarbonisation pathway”.
The second one is that with the implementation of all the technologies, there would be positive economic benefits for societies, but also for households.
And the third is that while “the target in the distance is important, it’s even more important to get going”.
“We have a lot of targets, a 2050 target and a 2030 target, but what we really need to do is start marching towards those and while we are happy to contribute to the debate, we need a period where we focus on delivering the already agreed policy.”
Scenario planning
While scenarios are not intended to be specific predictions of the future, they are nevertheless a key starting point for wider engagement and Ruby says that the Decarbonisation speedways study provides insights to inform discussions with the European Commission on the one hand and with industry stakeholders on the other.
They also do not take account of specific challenges that are faced, among which Ruby mentions those currently in Europe including the debate around electricity market reform, infrastructure permitting, supply chains and not least potential future skills shortages.
“In debates, everybody likes to give their two cents worth and what we’re doing is to basically say: What would be the implications? What are the things we should do? What should we build and where should we build – how many transformers, how many wind turbines? And what are the dollars and cents we need to invest to get this done? It’s about injecting some facts into the debate.”
