Electrification of the transport, heating and heavy-emitting industries — including switching to renewables-powered green hydrogen — could reduce greenhouse gas emissions by 60% by 2050, according to a report by BloombergNEF (BNEF).
Switching to battery and fuel-cell electric vehicles, heat pumps, and green hydrogen for heating and industrial processes would account for up to 60% (coincidentally the same figure) of final energy demand in these sectors — compared to 10% today — well short of full decarbonisation.
“That is due to the various hard-to-abate activities within them — including aviation, shipping, long-haul road transport and high-temperature industrial processes such as cement and steel — as well as the long replacement cycles of some assets,” said BNEF.
Reducing emissions to net zero would require other technologies such as carbon capture, use and storage (CCUS), added the analyst group, which produced its Sector Coupling in Europe: Power Decarbonisation report in collaboration with Norwegian utility Statkraft and Irish power-management company Eaton.
The study estimates that this electrification, or sector coupling, would increase power demand by 75%, with wind and solar providing the bulk of this extra electricity.
“Going forward, renewables can’t be part of the solution. They must be the solution,” said Henrik Sætness, senior vice-president of corporate strategy and analysis at Statkraft.
Electrifying these sectors and increasing the use of wind, solar and green hydrogen will require action from policymakers, added Victoria Cuming, head of global policy analysis for BNEF.
Renewables can’t be part of the solution. They must be the solution.
“Governments should introduce incentives or requirements to cut emissions from building heat, support demonstration projects for electrification, and iron out barriers to the production of green hydrogen,” she explained. “They should also consider how to engage energy consumers and civil society as they have a crucial role to play in enabling electrification of these new sectors.”
On top of this, policymakers “will have to support the reinforcement and extension of the grid to handle higher power volumes and more renewables, and the deployment of batteries and other sources of flexibility to balance the system,” said BNEF head of analysis Albert Cheung.
“It will be crucial that governments and regulators adopt an electricity market design that enables developers of wind and solar projects, and those planning battery storage plants or demand response services, to anticipate level of returns that justify their investment.”
If all these challenges are met, BNEF predicts that “a country like the UK or Germany” will see an 88% reduction in greenhouse gas emissions in the power sector by 2050, with emissions falling by 78% in buildings, 55% in the transport sector and 39% in heavy industry.