Global Energy and Climate Outlook 2019: Electrification for the low-carbon transition The role of electrification in low-carbon pathways, with a global and regional focus on EU and China Keramidas, K., Diaz Vazquez, A., Weitzel, M., Vandyck, T., Tamba, M., Tchung-Ming, S., Soria- Ramirez, A., Krause, J., Van Dingenen, R., Chai, Q., Fu, S. and Wen, X. 2020 EUR 30053 EN This publication is a Science for Policy report by the Joint Research Centre (JRC), the European Commission’s science and knowledge service. It aims to provide evidence-based scientific support to the European policymaking process. The scientific output expressed does not imply a policy position of the European Commission. Neither the European Commission nor any person acting on behalf of the Commission is responsible for the use that might be made of this publication. 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Contact information Address: European Commission, Joint Research Centre, Edificio Expo; C/ Inca Garcilaso, 3, E-41092 Sevilla, Spain Email: [email protected] EU Science Hub https://ec.europa.eu/jrc JRC119619 EUR 30053 EN PDF ISBN 978-92-76-15065-7 ISSN 1831-9424 doi:10.2760/350805 Print ISBN 978-92-76-15066-4 ISSN 1018-5593 doi:10.2760/58255 Luxembourg: Publications Office of the European Union, 2020 © European Union, 2020 The reuse policy of the European Commission is implemented by the Commission Decision 2011/833/EU of 12 December 2011 on the reuse of Commission documents (OJ L 330, 14.12.2011, p. 39). Except otherwise noted, the reuse of this document is authorised under the Creative Commons Attribution 4.0 International (CC BY 4.0) licence (https://creativecommons.org/licenses/by/4.0/). This means that reuse is allowed provided appropriate credit is given and any changes are indicated. 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EUR 30053 EN Contents Abstract ............................................................................................................... 1 Acknowledgements ................................................................................................ 2 Executive summary ............................................................................................... 3 1 Introduction .................................................................................................... 6 1.1 Global emissions and climate context ........................................................... 6 1.2 The need for a collective and concerted action .............................................. 7 1.3 The role of electricity in transition pathways ................................................. 8 1.4 Contribution of the report ........................................................................... 9 2 Global scenarios definitions ..............................................................................11 2.1 The reference and 2°C-Medium scenarios ....................................................11 2.2 Influence of various factors on electrification in a 2°C world ..........................13 3 Global energy system impacts of electrification in a 2°C context ...........................18 3.1 Historical trends and projections for greenhouse gas emissions ......................18 3.2 Primary Energy demand and supply ............................................................22 3.3 Fossil Fuel prices ......................................................................................25 3.4 Electrification in final energy consumption: the total picture ..........................27 3.4.1 Final energy consumption trends ..........................................................27 3.4.2 Final energy consumption electrification ................................................28 3.4.3 Low-carbon fuels and energy transformation .........................................31 3.5 Electrification in final energy demand: Transport ..........................................33 3.6 Electrification in final energy demand: Buildings ...........................................41 3.7 Electrification in final energy demand: Industry ............................................48 3.8 Electrification effects: Power generation ......................................................54 4 Macroeconomic impacts ...................................................................................60 4.1 Overall macroeconomic impacts of mitigation ..............................................60 4.2 Macroeconomic impacts of road transport electrification ................................64 5 Global air quality impacts .................................................................................69 6 Regional energy system impacts of electrification: focus on EU .............................74 6.1 Climate-related policy actions ....................................................................74 6.1.1 Regulatory framework for GHG emissions ..............................................75 6.1.2 Regulatory framework for renewable energy deployment ........................76 6.1.3 Regulatory framework for Energy efficiency ...........................................76 6.2 Energy transformation pathways by sectors in EU ........................................77 6.2.1 Greenhouse gas emissions mitigation ...................................................78 6.2.2 Electrification in EU: the total picture ....................................................79 6.2.3 Electrification in EU: Transport .............................................................80 6.2.4 Electrification in EU: Buildings ..............................................................81 i 6.2.5 Electrification in EU: Industry ..............................................................82 6.2.6 Electrification effects in EU: Power generation ........................................82 7 Regional energy system impacts of electrification: focus on China .........................84 7.1 Climate-related policy actions in China ........................................................84 7.1.1 Overarching Climate Policy ..................................................................85 7.1.2 Optimizing Energy Supply ...................................................................86 7.1.3 Conserving Energy and Improving Energy Efficiency ...............................90 7.1.4 Construction of the National Carbon Emission Trading Market ..................92 7.2 Energy transformation pathways by sectors in China ....................................92 7.2.1 Electrification in China: the whole picture ..............................................93 7.2.2 Electrification in China: Transport .........................................................93 7.2.3 Electrification in China: Buildings .........................................................94 7.2.4 Electrification in China: Industry ..........................................................95 7.2.5 Electrification in China: Power Sector ....................................................95 References ..........................................................................................................97 List of abbreviations and definitions ...................................................................... 106 List of boxes ...................................................................................................... 108 List of figures ..................................................................................................... 109 List of tables ...................................................................................................... 112 List of Annexes ................................................................................................... 113 Annex 1: Policies considered ............................................................................. 114 Annex 2: Description Energy/GHG model POLES-JRC ........................................... 133 Annex 3: Description of JRC-GEM-E3 .................................................................. 140 Annex 4: Socio economic assumptions ............................................................... 145 Annex 5: Techno-economic assumptions ............................................................ 146 ii Abstract This edition of the Global Energy and Climate Outlook (GECO) analyses the role of electrification in global transition pathways to a low Greenhouse Gas (GHG) emissions economy. Electricity is found to be an increasingly important energy carrier in final energy consumption