Electric Uses Are Important Part of Our Clean Energy Future

It used to be that using electricity for things like heating water and rooms was more expensive and dirtier than using natural gas or other fuels, so programs to promote switching to electric technologies a generation ago generally didn’t benefit utility customers or the environment. But dramatic increases in the efficiency of many electric technologies, as well as cleaner ways to generate the electricity, have significantly changed the landscape today and for the future. Just how much, is confirmed in the new U.S. National Electrification Assessment released today by the Electric Power Research Institute (EPRI).

The analysis projects an overall reduction in final energy consumption (by as much as 32 percent) and a decrease in economy-wide greenhouse gas pollution (up to 67 percent), all while the U.S. economy nearly doubles.

The Assessment—which examined customer adoption of such electric technologies as electric vehicles, space and water heating for buildings, and other applications—shows that economy-wide electrification will play a critical and growing role in tomorrow’s energy system. It projects that electricity’s share of our final energy use will increase from about one-fifth today, to nearly half in 2050. This is consistent with many other analyses—including NRDC’s, which put electricity at about 45 percent of our energy use by then.

The Assessment highlights a number of interesting and surprisingly consistent conclusions across the scenarios it examined.

Energy efficiency becomes an even more critical climate solution

Nearly every existing analysis of how we could reduce our greenhouse gas pollution by 80 percent by 2050, including NRDC’s, has found energy efficiency to be the most critical component to getting to the place scientists say we need to be to stave off the worst effects of climate change at lowest cost.

Utilities have long supported energy efficiency—both through customer programs and efficient building codes and appliance standards—and as we have frequently noted, there is still much untapped potential.

But does increased electrification, which would increase electricity use by its very definition, conflict with the goals of energy efficiency and render utility programs moot?

Absolutely not—if it is efficient electrification, it adds to the progress. That is because even though more electrification will increase electricity use, it decreases our economy-wide energy use (and the associated climate-warming emissions from generating it)—it is energy efficiency. For example, a battery electric vehicle is more than three times more energy efficient than its equivalent internal combustion engine.

When electric technologies are more efficient, utility efficiency programs can be a way to encourage customer adoption. But first we need to find a way to compare across all alternatives for a particular use. For example, when we evaluate water heater efficiency programs, we look for the most efficient gas water heater or the most efficient electric water heater, instead of the most efficient way to heat water. We need to find a way to compare based on how the energy is used (end use), not on its source. Then we will truly find the most efficient alternative.

Electric technologies are more efficient and cleaner

Electric end uses have become much more efficient, and technologies like electric heat pumps and electric vehicles are commercially available and becoming much more affordable (gas water heaters have also become much more efficient, but even the most efficient ones are only one third as efficient as modern electric heat pumps).

In addition, the electric grid is getting cleaner and is on a trajectory to become even more so because the cost of pollution-free resources like wind and solar have come way down and the fossil-fuel-fired plants we still have are more efficient.

Including grid benefits in the Assessment would result in more renewables/less natural gas

It is important to note that the National Assessment focused primarily on modeling efficient electrification, and less on the actual underlying resource mix. It explicitly does not model grid flexibility benefits of electric and other distributed resources that could be controlled to operate only or mostly when renewable energy is abundant, avoiding periods of peak demand; although EPRI plans to include them in state- and utility-level modeling moving forward. Therefore, the analysis resulted in an increase in economy-wide natural gas use.

However, electric technologies like vehicles and heating—along with other distributed (local) resources like energy efficiency, demand response, and PV solar panels—can provide a great deal of flexibility to the grid. This enables the integration of substantial amounts of renewable generation without increases in fossil fuel generation. In fact, NRDC’s analysis found significant decreases in natural gas use in 2050 by including these considerations.

Taking full advantage of the potential grid benefits of electric technologies, as well as other locally generated resources, will require increased attention and sophistication in distribution system planning and operation--as well as their increased integration in the distribution and transmission systems. Without an integrated energy network, this challenge becomes much more difficult to achieve.

Coordinated economy-wide policies are needed

The Assessment also finds that because electrification breaks down traditional barriers between sectors of the economy, a focus on only one can limit the potential benefits from electrification. For example, requirements for transportation efficiency increases or emissions reductions alone will result in lower achievements—and likely higher cost—than if the requirements were economy-wide and include the electric sector. NRDC and EPRI have found that electric vehicles can significantly reduce emissions of greenhouse gases and other air pollutants threatening our environment and health. In addition, driving on electricity has been the cost equivalent of driving on dollar-a-gallon gasoline for many years and it is projected to stay that way for the next 30 years.

An economy-wide carbon-reduction policy (the Assessment models a carbon price), allows interactions among multiple sectors to achieve broader goals.

Electrify everything?

While this electric industry analysis does not say to electrify everything, it does point out the considerable benefits of quickly and substantially electrifying a lot of things, and the need for broader policy (and R&D) to make it happen. In fact, utilities have an important role to play in adoption of these technologies.

EPRI is organizing Electrification 2018, the first ever International Conference and Exposition focusing on efficient electrification August 20-23 in Long Beach, CA. Electrification 2018 will be the place to explore the critical issues, benefits, and opportunities of electrification. I’ll see you there!