Electrification is an essential tool that companies need to assess to identify the potential for reducing their direct emissions. Companies are strongly encouraged to integrate electrification into their sustainability strategies to achieve meaningful emissions reductions to their building heating, fleet and processes (where applicable). This can enable proactive decarbonisation of natural gas and corporate fleet (Scope 1) emissions. The technologies available are becoming increasingly cost effective, however, there are several considerations that need to be taken into account before installation.
What is electrification?
Electrification is a process that involves replacing equipment that utilises a fossil fuel, for example, natural gas or diesel, with an alternative appliance which is powered by electricity. This enables companies to directly replace their fossil fuel use with electricity, presenting an opportunity to decarbonise their direct emissions. For many companies, electrification is implemented by switching diesel / petrol fleet to electric vehicles and by replacing natural gas-fed boilers with electric alternatives. Facilities which undertake manufacturing processes will also be able to assess the feasibility of switching to electricification technologies on a process-by-process basis.
What are the benefits of electrification?
Replacing fossil fuel consumption with electricity enables easier access to decarbonisation levers for the corresponding energy use, in turn bringing companies closer to achieving the emission reduction targets they may have in place. There are more options available to procure zero carbon electricity, i.e. through renewable supply contracts, PPAs or solar panels, than to source renewable gas / biomethane which is not eligible to be reported as zero carbon under the current reporting standards of the GHG Protocol and SBTi (subject to potential change in the future).
An additional advantage of modern, electric boilers is that they are often more efficient. This is important to consider as it helps to offset the increased operating costs associated with using electricity over natural gas. There are also secondary environmental benefits, including a reduction in noise pollution and particulate pollution associated with fossil fuels.
What are the barriers to electrification?
The most significant challenge for companies that aim to electrify operations is the increased cost of electricity prices relative to natural gas. This can significantly reduce the business case for fuel switching when there are already high capital costs involved with electrification technologies.
The barriers to electrification are most prominent for manufacturers. A notable restriction is the delay in obtaining a connection agreement with the national/local electricity grid. For some locations, there is currently insufficient infrastructure to support companies with manufacturing facilities. Energy-intensive companies are encouraged to explore self-generation to reduce their reliance on the grid for decarbonisation.
Additionally, although there are a number of commercially available technologies available, there are technology gaps for specific processes, including those with high-temperature requirements.
What are the key considerations for electrification?
Electrification is a key enabler of zero or low-carbon supply, however, the emissions intensity of the supplied electricity must be lower than the conventional fuel to result in lowered emissions. Therefore, it is always recommended that any electrification measures are covered by 100% renewable electricity supply (with bundled / or unbundled Energy Attribute Certificates (EACs)).
Not all facility requirements can be fulfilled by an electric appliance and so a full feasibility assessment should be carried out on a case-by-case basis. To optimise the economic case for electrification, it is recommended that capital equipment at the end of its natural life is prioritised for replacement, rather than retrofitting and displacing functional machinery.
How can Electrification be achieved?
Step 1: Comprehensive Feasibility Study
The initial stage involves analysing a facilityโs energy demand (on-site) to understand the requirements of the site, assessing the infrastructure of the site and evaluating the associated costs.
Step 2: Electrification Technology Integration
Next, it is important to determine whether the siteโs electrical grid can support the additional load of the electric appliance. A compatible appliance with the required specifications will need to be identified, procured and integrated.
Step 3: System Optimisation
Thorough commissioning tests are required to ensure the electrification technology operates efficiently. Operators will need to be trained on the new equipment, focusing on safety, efficiency, and emissions monitoring. Periodic reviews should be undertaken to ensure the installations are meeting technical, economic, and environmental requirements.
How can NUS Support with Electrification?
NUSโ Energy and Sustainability Services (ESS) team can support clients by performing desk- and onsite assessments regarding the electrification opportunities across different facility types, including office spaces, warehouses and complex manufacturing plants.
Assessments identify specific opportunities, alongside carbon savings and costs. To learn more about our services, get in touch with your NUS consultant, or contact us.