The significance of electrification for climate action

“Green electrification” describes the trans­formation of energy consumption to replace fossil fuels with power from renewable sources. If consumers across all sectors –from industry and transport to buildings and agriculture – are enabled to switch to electricity-based processes and technologies, greenhouse gas emissions will be reduced. Efficiency gains can also contribute to reducing emissions, meaning an improved yield per unit of energy; electric mobility is a prime example.

Electrification of consumption is therefore a key complement to the green energy transition, which focuses primarily on the production of climate-friendly electricity. Successively electrifying energy consumption could enable all economic sectors and areas of life to switch to renewable energy. However, simply electrifying all sectors and everyday life (“electrify everything”) is con­sidered too costly. Green hydrogen will also be required, especially in industry (indirect electrification).

Growing political interest and economic expectations

The Turkish initiative capitalises on grow­ing political interest in electrification. As the International Energy Agency (IEA) notes, the energy price shocks associated with the US-Iran war have accelerated a shift in thinking. The situation of persistently high and volatile oil and gas prices following the price shocks in 2022 and 2026 creates competitive disadvantages and social pressures in importing countries. For many, oil and gas imports are the Achilles’ heel of their economies. In the long term, importing nations in Europe, Africa, Asia and Latin America can address that risk only by lowering the share of fossil fuels in their energy consumption.

Accelerating electrification is also expected to modernise economies and generate growth. Households and businesses will invest in new technologies, and infrastructure will need to be renewed and expanded. In Europe, weather-related fluctuations in renewable electricity supply must already be balanced with demand, making flexible electricity grids and large-scale battery storage increasingly important. Switching energy consumption in the transport and buildings sectors from oil and gas to electri­city requires electric drives, efficient battery technologies and heat pumps, as well as electrolysers to generate hydrogen. Rising demand for electrification technologies (clean tech) is also driving international competition to develop cost-effective solu­tions – as was the case with solar and wind energy technologies.

Global market share in clean technologies is a key benchmark for Germany and other EU member states when it comes to measuring innovative strength and geo-economic dominance, particularly in com­petition with China. Harnessing this com­petition to advance electrification and climate action at low cost while maintaining economic leadership is currently one of the major challenges facing European governments.

The global electrification target – a foregone conclusion?

Although an electrification target would contribute to climate protection and provide a degree of insulation from volatile energy prices, agreement at Antalya is by no means guaranteed. This is evident from the efforts of the Turkish COP Presidency during New York Climate Week in September. Rather than prioritising a green target, the pledge is not specifically green. Environmentalists are particularly critical that this would encourage the expansion of nuclear power.

The Australian-Turkish COP Presidency is focused on diplomatic success and wishes to avoid restricting the scope for progress in individual countries. Instead, poorer nations need to be brought on board to agreeing to yet another target through financial com­mitments. To this end, it has also involved companies and other stakeholders in the Global Electrification Pledge, which aims to mobilise funding for the poorest countries, island states and developing nations. Power grids and storage top the list of necessary investments. Meanwhile, the number of countries wish­ing to participate in the “Elec­trify Now” campaign has been growing, with the new­comers including Germany, Uruguay, Jor­dan and Kenya. The Pacific Island Countries expressed their support for the global target in a communiqué at the beginning of Sep­tember, and coupled this with a clear call for technical and financial assistance.

The challenge remains to convince more developing countries to agree to an additi­onal global target and take on another obli­gation. While many developing countries point to past failures to provide promised support for their efforts, the growing crisis in international climate finance further eroded the credibility of any commitments. The COP Presidency will need to demonstrate particular diplomatic skill here, both before and during the conference, and organise concrete incentives.

From the climate perspective, the global electrification target lacks binding com­mitments, and should ideally be limited to renewable electricity sources. As with the other implementation targets – in particu­lar the global targets to double energy effi­ciency and triple renewable energy capacity by 2030 (COP28 in Dubai) – the targets should be formulated to enable monitoring and progress reporting. Codification will be required to ensure that progress is trace­able. The Nationally Determined Contributions (NDCs), which parties to the Paris Agreement are required to submit to the UNFCCC every five years, could serve this purpose, as they allow countries to choose which climate targets they intend to achieve and by what means. Ultimately, this would enable transparent tracking of progress on the global electrification tar­get, includ­ing its contribution to climate protection.

Beyond COP31

In Germany and the EU, pressure is mount­ing to rapidly transform the energy system to increase use of electricity from domestic sources and to protect value chains. There is therefore a strong self-interest in electri­fying on the basis of renewables, yet this is evidently not sufficient given the current energy supply risks and the anticipated costs of the system transition. For this rea­son, green electrification should be clearly named as a strategic goal. That will send an important signal to businesses across many sectors, charting a path towards greater stability of energy supply and safe­guarding the business environment. Energy price volatility, persistent fossil fuel supply bottlenecks, and rising global energy con­sumption have led the EU to pursue green electrification with greater vigour. Com­bined with a global agreement of the kind envisaged for COP31, the electrification target could provide further impetus for international cooperation.

Meanwhile, in competition with China the aim should be to support European pro­ducers of clean-tech products and secure markets in third countries. The international climate negotiations on electrification pro­vide an important signal in this regard and can help German clean-tech diplomacy to negotiate bilateral cooperation in more con­crete terms. Here, the ‘Electrify Now’ initi­ative can serve as a useful platform for engaging like-minded middle powers and other trading partners.