To achieve zero greenhouse gas emissions by 2050, the global electricity sector must gradually invest US$2,2 trillion annually. This amount is needed to modernize and digitalize electricity systems so that they can adapt to new technologies and ways of consuming energy.
The analysis is part of the study prepared by Thymos Energia, a business consultancy specializing in the energy sector, in partnership with Abraceel (Brazilian Association of Energy Traders) on the CIGRE Paris Session 2024, one of the largest global meetings in the electricity sector.
The analysis indicates that, in addition to an energy transition to renewable sources, countries will have to expand the supply of energy generation to the expected growth in consumption.
Global demand for electricity, driven by population expansion and the electrification of industrial processes and transport, is estimated to grow by more than 150% by 2050, making robust investment in infrastructure necessary.
“Climate change is already a reality. The last ten years have been the hottest on record and, between January and September of this year, the average global temperature rose by 1,54°C,” highlights Jovanio Santos, Director of New Business at Thymos Energia.
“This means that the central goal of the Paris Agreement may be at risk if urgent measures are not adopted. We understand that the electricity sector can make an important contribution in this regard”, he adds.
The study also points out that data from the World Energy Outlook shows that global CO2 emissions from the energy sector, currently at 15 gigatons, are expected to fall 45% by 2030 in the net-zero emissions scenario, reaching zero globally by 2045.
With this, Thymos emphasizes that one way to achieve the global goal is to decarbonize the electricity grid, using renewable sources. To achieve this, by 2050, it will be necessary to double the length of transmission and distribution networks worldwide, with more than 80 million kilometers with the replacement or implementation of new infrastructure.
According to Thymos, 3 TW of capacity is in the process of being connected from renewable sources, including solar, wind, hydroelectric and bioenergy, in countries such as the United States, Spain, Brazil, Italy, Japan, the United Kingdom, , Australia, Mexico, Chile, India and Colombia.
Of this total, around 1,5 TW are solar and wind projects in advanced stages, with 500 GW already having documents signed or close to being signed, indicating a high probability of connection to the grid in the next five years.
These projects represent 40% of the renewable capacity installed in these countries. Additionally, another 1 TW of projects are being analyzed to the feasibility of connection and possible improvements in the electricity grid infrastructure.
The analysis points out that large power generation projects, especially wind and solar photovoltaic, often face challenges related to the distance from load centers, requiring complex transmission networks to transport the energy.
According to Thymos, the construction of these networks involves multiple agents and can take more than a decade, far exceeding the implementation time of generation assets.
In advanced economies, a single extra-high voltage (above 220 kV) overhead line can take 5 to 13 years to be authorized and constructed, depending on factors such as the length of the line.
The consultancy's study also shows that energy markets will also need to increase the flexibility of their systems to meet fluctuations in energy consumption in the short and medium term, in addition to dealing with the intermittent nature of some renewable sources.
In this sense, another emerging technology that can contribute to the stability of energy supply are storage systems.
Public and private investments for decarbonization
The Thymos survey also shows that there are other technologies being studied around the world, such as low-carbon hydrogen and electric vehicles, which can a more sustainable energy matrix.
However, the consultancy pointed out that advances will require public and private efforts so that they can be integrated, in fact, into the electricity markets and bring benefits to the global matrix.
“It is important that countries define strategies for using these technologies, considering the particularities of each sector of the economy and defining relevant policies and regulations. The result will be the promotion of a healthy business environment, with the development of new products to meet the needs of energy consumers,” says Jovanio.
He further emphasizes that international collaboration is essential to share experiences and create solutions adapted to the specificities of each nation.
Liberation of the electricity market
The survey highlights different experiences of market opening, including models that are already fully liberalized, such as those in Australia and Norway, and others in the process of improvement, such as those in Israel, Russia and Brazil.
“Climate change has impacted daily life, and consumers have become increasingly aware of their use of electricity. Opening up the market is an inseparable aspect of decarbonizing the energy matrix in the energy transition,” says Jovanio.
According to the executive, allowing consumers to choose their supplier and energy solutions according to their needs boosts competitiveness and innovation in the sector, while accelerating the adoption of clean energy sources and the incorporation of sustainable technologies, fundamental pillars of the decarbonization movement.
The Abraceel Paris 2024 Mission White Paper was curated by Thymos Energia and summarizes the debates followed by the group during the Paris Session event, which brought together more than 9 participants from over 100 countries.
Held by CIGRE, the event highlighted climate change, energy security and the integration of renewable sources as central themes for the energy transition.
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