Electricity as energy carrier

Electricity will play a central role in the energy transition. Electricity production is still dominated by fossil fuels.

Electricity can be produced in different ways, for example, using fuel-based steam generators, heat engines fueled by combustion or nuclear fission, solar energy, or using kinetic energy in running water or wind. Today, electricity is mainly generated in power plants using coal and natural gas. Although a large part of the electricity is still fossil fuel-based, it is possible to generate electricity with purely emission-free sources such as solar, wind, hydropower and nuclear energy. Solar and wind still account for only a small part of the electricity generation, but this share is growing fast.

Figure 1. World gross electricity production by source, 2016 (Source: IEA)
Demand for electricity is steadily increasing.

The demand for electricity worldwide is increasing, especially in non-OECD countries. Electricity generation has increased yearly over the past few decades, except for 2008. Electricity is mainly consumed in the industry, the built environment, and the service sector. Although the use of electricity in the transport sector is still small, it has grown rapidly in recent years with an increasing use of electric transport.

Flexibility is currently provided by fossil fuel-based generation that can adapt to the varying demand.

In the electricity system, supply and demand for electricity must be balanced at all times. Electrical energy cannot easily be stored on a large scale. Therefore, the supply of electricity must adapt flexibly at any time to the changing demand for electricity based on careful predictions and coordination in the current energy system.

Flexibility solutions are increasingly important in an energy system with more and more variable renewable sources.

The supply of electricity from renewable sources, such as solar and wind, is variable and can only be used flexibly to a limited extent. Therefore, the energy transition is challenged by the need to open up the flexibility traditionally supplied by fossil fuel power plants in the system. 

Electricity supply profiles require a good mix of types of electricity generation. For example, in the Netherlands, the sun often does not shine when it is windy. Electricity can also be traded internationally, for example, electricity can be imported or exported when there is a shortage or surplus of electricity in the Netherlands. Moreover, there is a role for demand response, energy storage in batteries, or via so-called power-to-X techniques. Examples of the latter include ‘power-to-hydrogen’ and ‘power-to-ammonia’, whereby electricity is used for the production of hydrogen or ammonia. All this requires a careful analysis of the existing networks, the demand for electricity per region and the available generation types. For the Netherlands, supply and demand for flexibility in the electricity system during the 2015-2050 period have been analyzed in the FLEXNET-led project (https://www.ecn.nl/flexnet/).

Electrification can be further expanded through the use of hydrogen and other Power-to-X technologies.

In those parts of the economy where there is a continuing need for liquid and gaseous energy carriers, extensive use of sustainable sources, such as solar and wind, can also take place through the use of the above-mentioned power-to-X techniques. For example, with electrolysis of water – where hydrogen is produced using sustainable electricity – the use of fossil fuels can be replaced by “green” hydrogen.