Europe’s electrification has stagnated for the past decade, primarily due to decreased power demand driven by a slowdown in industrial activity, a new report from electricity trade association Eurelectric reveals.
The Power Barometer 2024 report finds that the EU’s electrification rate has plateaued at roughly 23% since 2015, well below the bloc’s goal of 50% by 2040.
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The lack of progress is closely tied to Europe’s falling electricity demand, according to the report.
While the decline can partly be attributed to energy efficiency improvements and milder weather conditions, Eurelectric identifies industrial recession amid a wider economic downturn as the primary cause.
Between 2022 and 2023, electricity demand across the EU dropped by 7.5%. The report ascribes the bulk of this reduction to energy-intensive industries either shutting down or relocating abroad in response to growing inflation, high capital costs and uncompetitive energy prices.
The EU has also struggled to electrify industrial processes. Electricity accounts for only a third of the energy consumed by European industry, with just 4% of process heating – responsible for 75% of the EU’s industrial emissions – electrified.
“The missing piece between going green and staying competitive is electrifying. Industrial sectors hold a huge potential to electrify further based on available technologies,” said Eurelectric secretary-general Kristian Ruby.
The report notes that, despite these challenges, Europe has made significant strides in decarbonisation. In 2023, the EU’s power sector emissions were 50% lower than in 2008, while clean energy sources including renewables and nuclear accounted for 68% of electricity generation; the share of clean electricity generation has increased to nearly 75% in the first half of 2024.
This indicates that Europe is generating cleaner electricity, but its industries are struggling to keep pace with the shift away from fossil fuels. Ruby stressed that the EU must therefore address “the most pressing issues” of electrification and electricity demand to remain competitive.
China’s electrification rate, which stood below 23% in 2015, has now overtaken the EU’s.
