Electricity

Eurelectric: Clean electrification and massive renewables rollout can drive Europe to net zero by 2050

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June 22, 2023

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Published:

June 22, 2023

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Eurelectric, the European electricity industry trade body, has developed three scenarios for Europe to achieve the net zero target, highlighting clean electrification and a massive renewables rollout as the main drivers of decarbonization. Two of the three decarbonization “speedways” envisage climate neutrality by 2050, while the third, a more ambitious one, involves reaching the goal as early as 2040.

The 2050 date is set in the scenarios inspired by the European Union’s Fit-for-55 package and REPowerEU plan, while the pathway that targets 2040 is called Radical Action. All three call for clean direct electrification that would almost eliminate fossil fuels in buildings, transportation, and industry, as well as a strong increase in renewable energy capacities.

In the defined scenarios, the share of electricity in final energy demand would be 58%-71%, while the share of renewables in power generation would reach 75%-82%.

To meet the needs of renewables integration on the distribution level, investments in distribution grids will need to increase, the report notes. The Fit-for-55-inspired scenario calls for annual investments of between EUR 34 billion and EUR 96 billion, or a cumulative EUR 1.012 trillion – EUR 2.874 trillion by 2050, while Radical Action would require EUR 47 billion – EUR 111 billion per year, or a cumulative EUR 1.414 trillion – EUR 3.33 trillion.

Upgrading distribution grids for renewables integration calls for investing 0.20%-0.65% of the EU’s GDP each year

As the combined gross domestic product of the EU member states in 2021 was USD 17.089 trillion, this translates into an equivalent of 0.20%-0.65% of the bloc’s GDP, assuming an equal dollar-to-euro conversion rate.

Reaching carbon neutrality requires adequate policies

Eurelectric also highlights the need for massive investments in power generation and infrastructure and for properly designed policies that would enable reaching climate neutrality.

The report, titled Decarbonisation Speedways, shows that electricity capacity will have to triple by 2040, together with a ten-fold expansion in renewables, but warns that delivering on such ambitious goals requires adequate policies.

The Radical Action scenario envisages 3,387 GW of wind and solar in 2050

In the Fit-for-55-inspired scenario, the total necessary solar and wind capacity in 2050 is 2,485 GW, while Radical Action envisages 3,287 GW. To reach these renewable capacity targets, the expansion of solar and onshore and offshore wind needs to be accelerated significantly compared to their historical growth.

Massive renewables integration calls for sufficient flexibility in power systems

The report also notes that integrating high shares of variable renewable power sources requires sufficient flexibility, the ability of an electricity system to respond to variations in electricity supply and demand. By 2050, the required amount of flexibility is projected at between 531 TWh and 782 TWh.

Flexibility can be achieved with the help of smart charging in transportation, demand side response (DSR) in industry, and heat pumps in buildings, but energy storage solutions, for example prosumer-scale batteries, are also important.

Green hydrogen can play an important role in decarbonization

When it comes to hydrogen, the report notes that it will play an important role in the decarbonization of hard-to-abate sectors such as heavy transport and heavy industries, but only if it is produced using renewable energy (green hydrogen).

In the Fit-for-55-based scenario, the total hydrogen production in 2050 is expected to be at 1,984 TWh, in the REPowerEU-inspired scenario at 2,089 TWh, and in Radical Action, 2,239 TWh.

Decarbonization benefits outweigh costs

Eurelectric also notes that the societal, economic, environmental and climate benefits of a decarbonized energy system outweigh the associated costs. For example, decarbonization would ensure between EUR 40 billion and EUR 140 billion in annual savings in healthcare and air quality and avert 58,000 premature deaths.

It would also reduce final energy consumption by 460 million tons of oil equivalent by 2030, cut fuel imports by EUR 175 billion a year, and lower citizens’ energy bills, according to Eurelectric.

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