Global Energy Transition Challenge – Explained

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• At the mid-year climate talks in Bonn, Turkey proposed a global target of meeting at least one-third of the world’s energy needs through electricity by 2035, highlighting the central role of electrification in achieving climate goals. 

Understanding Electrification

• Electrification refers to the process of replacing direct fossil-fuel use with electricity across different sectors of the economy. 
• It involves shifting activities such as transportation, industrial production, cooking, heating, and other energy-consuming processes from coal, oil, and gas to electricity.
• Electrification is a critical component of the global energy transition because most clean energy sources, such as solar, wind, hydropower, and nuclear energy, generate electricity rather than directly supplying usable energy.
• As a result, achieving deep decarbonisation requires not only expanding renewable energy but also ensuring that end-use sectors increasingly rely on electricity.

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Electrification and Climate Goals

• Climate change is driven primarily by greenhouse gas emissions resulting from the combustion of fossil fuels. 
• Consequently, reducing emissions requires replacing conventional energy sources with cleaner alternatives. 
• A key distinction exists between fossil fuels and renewable energy sources:
  • Fossil fuels are direct sources of energy and can be used immediately through combustion. 
  • Renewable energy sources generally need to be converted into electricity before they can be utilised. 
• Therefore, a complete transition away from fossil fuels is not possible without widespread electrification. Tracking electrification levels has become an important indicator of progress toward climate goals and energy transition. 

Current Status of Global Electrification

• Despite the widespread presence of electricity in modern life, its contribution to overall energy consumption remains relatively limited.
• According to the International Energy Agency (IEA):
  • Electricity accounted for only 21% of global Total Final Energy Consumption (TFEC) in 2025. 
  • The corresponding figure for India was about 23%. 
• TFEC measures the energy ultimately consumed by end users and excludes energy used during extraction, conversion, transportation, and distribution processes. 
• Although global electricity generation increased from around 24 terawatt-hours (TWh) in 2015 to over 32 TWh in 2025, the share of electricity in final energy consumption increased only modestly, from 17.7% to 21% during the same period. 

Challenges to Rapid Electrification

• Several sectors remain difficult to electrify because of technological and operational constraints. These include:
  • Aviation and shipping
  • Heavy-duty and long-haul transport
  • Iron and steel manufacturing
  • Cement production
  • Glass and ceramics industries
  • Certain residential heating applications
• Many of these sectors require high-temperature processes or energy-dense fuels that currently lack commercially viable electric alternatives.
• As a result, significant portions of global energy demand continue to rely on fossil fuels.

The Clean Electricity Challenge

• Electrification alone is not sufficient to achieve climate goals. The source of electricity also matters. According to IEA data:
  • Only about 42% of global electricity generation in 2025 came from non-fossil fuel sources such as renewables, hydropower, and nuclear energy. 
• This creates a major challenge:
  • Only 21% of final energy consumption is electrified
  • Only 42% of that electricity is generated from clean sources
• As a result, just over 8% of the world’s total energy consumption currently comes from clean electricity, while more than 90% of global energy use still depends on fossil fuels. 
• These figures underline the scale of the transition required to achieve international climate targets.

Turkey’s Proposed Electrification Target

• At the Bonn climate talks, Turkey proposed that countries collectively aim to meet at least 35% of global energy demand through electricity by 2035. Currently, global electrification levels are around 20-23%. 
• The proposal is based on a roadmap prepared by the International Renewable Energy Agency (IRENA). According to IRENA:
  • A 35% electrification rate by 2035 represents the minimum level required to keep the world on the 1.5°C pathway under the Paris Agreement. 
• The proposal is expected to be discussed at COP31, which Turkey and Australia will jointly host in Antalya later this year. 

Requirements for Achieving the Target

• Achieving the proposed electrification target will require substantial investments and infrastructure expansion. Key requirements include:
  • Annual investments of approximately $1.2 trillion in electricity systems
  • Rapid expansion of renewable energy capacity
  • Large-scale deployment of battery storage systems
  • Modernisation of transmission and distribution networks
  • Electrification of transport and industrial sectors
• The challenge is further complicated by geopolitical conflicts, supply chain disruptions, and economic uncertainties that may affect investment flows and energy security priorities. 

Implications for India

• India has emerged as one of the fastest-growing renewable energy markets and already derives approximately 23% of its final energy consumption through electricity. 
• For India, accelerated electrification can contribute to:
  • Reduced dependence on imported fossil fuels
  • Improved energy security
  • Lower greenhouse gas emissions
  • Expansion of electric mobility
  • Progress toward its net-zero target of 2070
• However, significant investments in renewable energy, energy storage, smart grids, and industrial decarbonisation will be required to sustain this transition.

Source: IE