“We need urgent action to accelerate the shift from fossil fuels to renewable and low-carbon energy as well as the rapid rollout of technologies that improve energy efficiency”

In an article for the World Economic Forum annual meeting, Morten Wierod, CEO at ABB, the Swedish-Swiss multinational electrical engineering corporation, gives a strong argument for the importance of energy efficiency.

Why electrification and efficiency are the two keys to hitting net zero

• An urgent challenge of the energy transition is integrating renewable energy into power grids.
• Many technologies needed to decarbonize the energy system are already available.
• Energy efficiency is the most cost-effective way to avoid emissions.

The year 2025 marks a significant milestone in the transition to net zero. Not only is it the 10th anniversary of the Paris Agreement but, according to climate scientists, by 2025 global greenhouse gas emissions (GHG) must start to decline if we are to limit global warming to 1.5°C above pre-industrial levels. After that, emissions need to fall rapidly to meet our climate goals.

We won’t find out until next year whether GHG emissions have peaked. But what we do know is that to stay within the 1.5°C limit, we need urgent action to accelerate the shift from fossil fuels to renewable and low-carbon energy as well as the rapid rollout of technologies that improve energy efficiency.

Electrification for a low-carbon future

One of the biggest and most urgent challenges is to expand and upgrade electricity grids. In many countries, the power infrastructure is old and inadequate while in others there is a lot of renewable energy waiting to be connected to the grid.

The International Energy Agency (IEA) estimates that meeting national energy and climate targets will require adding or refurbishing more than 80 million kilometers of grids by 2040. This is the equivalent of the entire existing global grid. At the same time, we need to develop and deploy existing technologies that support the decarbonization of industry, transport and buildings.

The technology we need already exists

Despite the challenges, we already have many of the technologies needed to decarbonize the energy system. Digitally enabled control systems are facilitating grid-scale renewable energy projects in remote and inhospitable places like deserts and floating platforms. Advances in energy storage and stabilizing technologies are also helping grid operators overcome the key challenge of intermittency — ensuring a stable power supply when the sun goes down or the wind doesn’t blow.

Integrating renewables into the electricity grid has seen some of the biggest advancements by combining technologies from different industries. One solution, developed by ABB in collaboration with Netherlands-based S4 Energy, uses motors bidirectionally to alternate the flow of power between energy storage systems and the grid. By doubling as a motor and a generator, the motors recharge the battery when renewable energy is abundant and supply power to the grid at night or peak demand periods.

Another important advancement in creating a more sustainable power grid is the replacement of SF6 (Sulfur Hexafluoride) in medium-voltage electrical switchgear. SF6 is an insulating gas used by power companies all over the world, but also a highly potent greenhouse gas. Jurisdictions including the EU and California are poised to ban SF6 in new electrical equipment of certain voltages from 2026. That’s good news — but companies must adapt. To do so, ABB, for example, will launch a new range of compliant SF6-free insulating switchgear solutions, piloted and tested in partnership with Italian power company Enel at substations in Italy and Spain.

Partnerships like these will be key to the wider transition toward renewable power in the electricity grid.

Energy efficiency against emissions

The most significant short-term opportunity to reduce energy consumption and avoid emissions is to invest in energy efficiency. The savings on energy bills typically mean that these investments pay for themselves relatively quickly. But many don’t realize the untapped potential of energy efficiency to reduce emissions. For example, electric motor systems consume around 45% of the world’s electricity. Upgrading motors to more energy efficient models and equipping them with variable speed drives can reduce their energy demand by 20-30%, also offering short payback periods for these investments.

Supportive government policies can significantly accelerate progress. In 2021, the EU introduced a regulation mandating the phase-in of higher-efficiency electric motors. The EU estimates that this will save 106 TWh of electricity by 2030, equivalent to the annual power consumption of the Netherlands, and avoid 40 million tons of CO2 emissions per year. Additionally, the measure is expected to reduce annual energy bills for EU households and industry by approximately €20 billion.

The energy transition is good for business. Technological advancements driven by generative artificial intelligence are significantly improving the efficient monitoring and management of industrial plants and equipment. These innovations lead to lower costs, safer operations and reduced energy consumption and emissions.

The energy transition is overdue. By accelerating technology deployment and improving efficiency in the tech we’re already using, we can build a secure path to net zero.

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