Week 1 – Session 5

Power Generation in Global

Energy Demand

Arash FARNOOSH

MOOC ENERGY TRANSITION

IFP SCHOOL
Introduction
This session is about setting the scene and reminding you the importance of electricity in
everyday life. Moreover, as it will be one of the fastest growing final energy usages in the
decades to come, decarbonizing electricity will be a key step on the road towards a “well-
below 2-degree world”.

Electricity: an essential energy carrier

Since the first experiences of Benjamin Franklin in the 18th century, through the inventions of
Michael Faraday or the work of Thomas Edison, electricity has taken up a larger part of our
everyday life. It has now become an essential energy carrier, providing energy services such
as lighting, heating and refrigeration, or information technologies.

An electricity mix dominated by fossil sources

If we look at the current situation, 65% of electricity is produced from coal, natural gas and
oil. A quarter of global power generation comes from renewable sources, hydro first, then
wind, biomass, solar and geothermal power. Finally, nuclear accounts for 10% of electricity
production today.

Overall, electricity consumption only accounts for one fifth of our final energy demand today.
But over the last 25 years, global electricity consumption doubled, while primary energy
demand increased by only 60%. This trend will probably continue in the future, driven by the

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surging demand for motor systems, appliances, cooling, and information and communication
technologies.

Why have coal and natural gas been dominating the power generation mix?

Because in most cases, they have proven to be quite reliable, rather flexible and
economically competitive means of production. If you take a look at the graph next to me,
showing recent data for the full life-cycle cost for producing one megawatt-hour of electricity,
you can see that coal and natural gas were the least expensive fuel at the beginning of the
study.

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Sure, the situation is evolving now as the costs of producing wind and solar power have
decreased dramatically, but power plants that are built today generally have an operating
lifetime of 20 to 40 years. So the current mix will require a few decades to evolve.

Moreover, because up to now, electricity could not be stored easily in an economical

manner, many countries have favored the flexibility of dispatchable means of generation
(such as nuclear and fossil fuels) over variable resources such as wind and solar.

Electricity: a key sector for decarbonization

But generating electricity with coal, natural gas, or oil comes with one major drawback.
Associated CO2 emissions is a major driver of the greenhouse effect, trapping heat inside the
atmosphere and causing severe climate change. If electricity only represents 20% of our final
energy consumption, it accounts for 40% of energy-related CO2 emissions.

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This share could keep growing in the future. Indeed, according to the International Energy
Agency, over the next 25 years, China will bring online additional electricity production
equivalent to the current United States market. Over the same period, India will add the
equivalent of the European Union’s current electricity production.

These countries still rely heavily on coal for producing electricity, 67% of the generation mix
in China, 76% in India. Expanding the power production with the same resources will make it
impossible to maintain temperatures in line with the Paris Agreement objective.

If we take a look in more detail, coal emits approximately 1 ton of CO2-eq. per megawatt-
hour produced, roughly twice the amount emitted with natural gas. We hence have an urgent
need to decarbonize our power generation mix, either by shifting towards less carbon-
intensive means of production, such as nuclear or renewables, or by adding carbon capture
& storage technologies to carbon emitting installations.

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The challenge is daunting: according to the IEA projections only for OECD economies, the
average CO2 intensity of electricity needs to fall from 411 grams per kilowatt hour in 2015 to
15 g/kWh by 2050 to achieve the goal of limiting the global increase in temperatures to 2°C.

To sum up what we just talked about : electricity is an essential energy carrier for many
applications. But power is CO2 intensive, it represents 20% of our energy use but is
responsible for 40% of CO2 emissions. Moreover, electricity consumption is expected to
grow in the future: 1 billion people still lack access to modern energy today, and global
electricity needs are growing. So it is essential to decarbonize the electricity mix to mitigate
the risk of climate change.

This task comes with many challenges, as we will discuss in the next videos. Before that, I
will explain you the electricity chain, and the various means of power generation.

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