[140] Electrification, energy efficiency and decarbonisation

Sometimes, we have opportunities in the energy system to make step changes rather than incremental changes. E.g. for electric vehicles and heat pumps, we can save a factor three to five in final energy when switching to electricity. Provided this electricity comes from renewables, the combination of renewables with energy efficiency through electrification provides one of the most powerful decarbonisation routes for our energy systems, and market design should reflect this.

A similar gain can be achieved through the electrification of thermal processes in industry. Again we observe end-use efficiency gains of a factor two to three. Hence industry could consider electrification as a promising decarbonisation route.

[139] Which action doesn’t matter as long as we take action

The result of this poll was 48% mandatory, 24% strongly encourage, 24% incentivised and 4% voluntary.

Energy efficiency does not happen without regulation [3] but is difficult to regulate [122]. For professional users, energy audits could resolve this dilemma by requiring energy users to review and consider energy saving opportunities, without prescribing which opportunities to pursue.

[138] Electric vehicles: green today, greener tomorrow

Internal combustion engines only convert a small part of the energy content of the fuel into mechanical energy for traction: around 20%. Battery electric vehicles have a much higher efficiency converting electricity into traction: above 75%.

As a consequence, enormous amounts of primary energy could be saved. Today in Europe the bulk of new electricity generation capacity is renewable. By mainstreaming electric vehicles, indigenous renewable electricity replaces imported fossil fuels, with the subsequent economic and environmental benefits.

[137] Getting a handle on transport emissions

This amount of oil would be replaced by ~800 TWh of electricity, which could be generated by a ~450 GW park of renewables (wind and solar). The investment required for this renewable capacity would be in the range of €500 billion, which can be paid back in about 7 years by the savings made in imports.

Going electric not only diverts money from imports to indigenous industry, but it generates net savings after a few years of operation.

[136] The challenge of deep retrofits

Cash flows from future energy cost savings don’t provide a stand-alone business case for deep retrofits, hence the need to consider other (multiple) benefits of energy efficiency and to adopt a systems approach to building energy renovation.

As for the systems approach, the revised EPBD (2018) seems to pave the way. The valuation of multiple benefits is more of a struggle. It’s now up to the Member States to come up with building renovation plans that sufficiently take greater recognition of areas such as health, energy poverty alleviation, air quality improvements, and supply security.