Equipment already on the market could raise electricity's share of global final energy consumption from 23% to 33% if all uses the International Energy Agency deems cost-competitive were electrified. The estimate in its September 22 Electrification report is a measure of economic potential under current technology costs and energy prices before this year's Strait of Hormuz supply shock, not a forecast that the rollout will occur.
The IEA separately models a 35% electricity share by 2035 in its High Electrification Scenario. That is a future pathway. The 33% snapshot uses present technology costs and pre-crisis energy prices; neither figure measures current deployment.
Efficient devices change the cost calculation
Electricity can cost more than fuel per unit of energy delivered to a consumer. But the device using it may need less energy to provide the same service. The IEA says an electric car is two to four times as efficient as one with a combustion engine. A typical heat pump delivers three to five units of heat for each unit of electricity it consumes. For driving and heating, the relevant comparison is therefore the cost of the trip or the warmth provided, not just the price of a kilowatt-hour.
On that basis, the report estimates that about half of residential fuel consumption could be electrified competitively. It puts the corresponding potential for fossil-fuel-based low- and medium-temperature industrial heat at almost 40%. The 33% global figure assumes the cost-competitive opportunities across sectors are taken up in full.
Adoption still depends on grids and upfront costs
More electric demand requires investment in power generation and grids. Vehicles, heat pumps and industrial equipment also carry upfront costs that can block purchases even when running costs are lower. The report points to financing, grid capacity and supply-chain concentration as constraints on how much of the economic potential countries can actually capture.
Sources
Image: A solar-powered EV charging station photographed in 2019 by Raysonho. Wikimedia Commons, CC0 1.0. The photograph illustrates transport electrification; it is not an IEA project or a depiction of the report's findings. Original image and license.