Editing IPCC:AR6/WGIII/Chapter-8 (section)

==== 8.4.3.1 Electrification and Decarbonisation of the Urban Energy System ====

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Urban energy infrastructures often operate as part of larger energy systems that can be electrified, decarbonised, and become enablers of urban system flexibility through demand-side options. With multiple end-use sectors (e.g., transport, buildings) and their interactions with land use drawing on the same urban energy system(s), increasing electrification is essential for rapid decarbonisation, renewable energy penetration, and demand flexibility ( [[#Kammen--2016|Kammen and Sunter 2016]] ) (see IMPs in Sections 3.2.5 and 8.3.4). The mitigation potential of electrification is ultimately dependent on the carbon intensity of the electricity grid ( [[#Kennedy--2015|Kennedy 2015]] ; [[#Hofmann--2016|Hofmann et al. 2016]] ; [[#Peng--2018|Peng et al. 2018]] ; [[#Zhang--2020|Zhang and Fujimori 2020]] ) and starts providing lifecycle emission savings for carbon intensities below a threshold of 600 tCO 2 -eq GWh –1 ( [[#Kennedy--2019|Kennedy et al. 2019]] ). Integrated systems of roof-top photovoltaics (PVs) and all-electric vehicles (EVs) alone could supply affordable carbon-free electricity to cities and reduce CO 2 emissions by 54–95% ( [[#Brenna--2014|Brenna et al. 2014]] ; [[#Kobashi--2021|Kobashi et al. 2021]] ). Furthermore, electrification and decarbonisation of the urban energy system holds widespread importance for climate change mitigation across different urban growth typologies and urban form ( [[#8.6|Section 8.6]] and Figure 8.21) and leads to a multitude of public health co-benefits (see [[#8.2|Section 8.2]] ).

Strategies that can bring together electrification with reduced energy demand based on walkable and compact urban form can accelerate and amplify decarbonisation. Taking these considerations – across the energy system, sectors, and land use – contributes to avoiding, or breaking out of, carbon lock-in and allows continued emission savings as the energy supply is decarbonised ( [[#Kennedy--2018|Kennedy et al. 2018]] ; [[#Teske--2018|Teske et al. 2018]] ; [[#Seto--2021|Seto et al. 2021]] ). Indeed, electrification is already transforming urban areas and settlements and has the potential to continue transforming urban areas into net-negative electric cities that may sequester more carbon than emitted ( [[#Kennedy--2018|Kennedy et al. 2018]] ; [[#Seto--2021|Seto et al. 2021]] ).

In its simplest form, electrification involves the process of replacing fossil fuel-based technologies with electrified innovations such as electric vehicles, buses, streetcars, and trains (Sections 10.3 and 10.4), heat pumps, PVs ( [[IPCC:Wg3:Chapter:Chapter-6#6.4.2.1|Section 6.4.2.1]] ), electric cook-stoves ( [[IPCC:Wg3:Chapter:Chapter-9#9.8.2.1|Section 9.8.2.1]] ), and other technologies ( [[#Stewart--2018|Stewart et al. 2018]] ). Cost-effective decarbonisation of energy use can be supported by electrification in urban areas if there is also demand-side flexibility for power, heat, mobility, and water with sector coupling ( [[#Guelpa--2019|Guelpa et al. 2019]] ; [[#Pfeifer--2021|Pfeifer et al. 2021]] ). Overall, demand-side flexibility across sectors in urban areas is supported by smart charging, electric mobility, electrified urban rail, power-to-heat, demand side response, and water desalination ( [[#Lund--2015|Lund et al. 2015]] ; [[#Calvillo--2016|Calvillo et al. 2016]] ; [[#Salpakari--2016|Salpakari et al. 2016]] ; [[#Newman--2017|Newman 2017]] ; [[#Meschede--2019|Meschede 2019]] ).

As an enabler, electrification supports integrating net-zero energy sources in urban infrastructure across sectors, especially when there is more flexible energy demand in mobility, heating, and cooling to absorb greater shares of variable renewable energy. In the transport sector, smart charging can reduce electric vehicle impacts on peak demand by 60% ( [[#IEA--2021a|IEA 2021a]] ). Urban areas that connect efficient building clusters with the operation of smart thermal grids in district heating and cooling networks with large-scale heat pumps can support higher penetrations of variable renewable energy in smart energy systems ( [[#Lund--2014|Lund et al. 2014]] , 2017). Higher urban densities provide the advantage of increasing the penetration of renewable power for deep decarbonisation, including mixed-use neighbourhoods for grid balancing and electric public transport ( [[#Hsieh--2017|Hsieh et al. 2017]] ; [[#Tong--2017|Tong et al. 2017]] ; [[#Fichera--2018|Fichera et al. 2018]] ; [[#Kobashi--2020|Kobashi et al. 2020]] ). Based on these opportunities, urban areas that provide low-cost options to energy storage for integrating the power sector with multiple demands reduce investment needs in grid electricity storage capacities ( [[#Mathiesen--2015|Mathiesen et al. 2015]] ; [[#Lund--2018|Lund et al. 2018]] ).

Electrification at the urban scale encompasses strategies to aggregate energy loads for demand response in the urban built environment to reduce the curtailment of variable renewable energy and shifting time-of-use based on smart charging for redistributing energy demands ( [[#O’Dwyer--2019|O’Dwyer et al. 2019]] ). Peak shaving or shifting takes place among frequent interventions at the urban level ( [[#Sethi--2020|Sethi et al. 2020]] ). Business models and utility participation, including municipal level demonstrations, can allow for upscaling ( [[#Gjorgievski--2020|Gjorgievski et al. 2020]] ; [[#Meha--2020|Meha et al. 2020]] ). The urban system can support increasing demand-side flexibility in energy systems, including in contexts of 100% renewable energy systems ( [[#Drysdale--2019|Drysdale et al. 2019]] ; [[#Thellufsen--2020|Thellufsen et al. 2020]] ).

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===== Smart grids in the urban system =====

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Smart electricity grids enable peak demand reductions, energy conservation, and renewable energy penetration, and are a subset of smart energy systems. GHG emission reductions from smart grids range from 10 to 180 gCO 2 kWh –1 (grams of CO 2 per kilowatt-hour) with a median value of 89 gCO 2 kWh –1 , depending on the electricity mix, penetration of renewable energy, and the system boundary ( [[#Moretti--2017|Moretti et al. 2017]] ). Smart electricity grids are characterised by bi-directional flows of electricity and information between generators and consumers, although some actors can be both as ‘prosumer’ (see Glossary). Two-way power flows can be used to establish peer-to-peer trading (P2P) ( [[#Hansen--2020|Hansen et al. 2020]] ). Business models based on local citizen utilities ( [[#Green--2017|Green and]] [[#Newman--2017|Newman 2017]] ; [[#Green--2020|Green et al. 2020]] ; [[#Syed--2020|Syed et al. 2020]] ) and community batteries ( [[#Mey--2019|Mey and Hicks 2019]] ; [[#Green--2020|Green et al. 2020]] ) can support the realisation of distributed energy and solar energy cities ( [[#Galloway--2014|Galloway and Newman 2014]] ; [[#Byrne--2016|Byrne and Taminiau 2016]] ; [[#Stewart--2018|Stewart et al. 2018]] ; [[#Allan--2020|Allan 2020]] ).

Currently, despite power outages that are costly to local economies, the adoption of smart electricity grids or smart energy systems has been slow in many developing regions, including in Sub-Saharan Africa ( [[#Westphal--2017|Westphal et al. 2017]] ; [[#Kennedy--2019|Kennedy et al. 2019]] ). This is due to a number of different factors, such as unreliable existing infrastructure, fractured fiscal authority, lack of electricity access in urban areas, upfront cost, financial barriers, inefficient pricing of electricity, and low consumer education and engagement ( [[#Venkatachary--2018|Venkatachary et al. 2018]] ; [[#Acakpovi--2019|Acakpovi et al. 2019]] ; [[#Cirolia--2020|Cirolia 2020]] ).

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===== Pathways and trade-offs of electrification in urban systems =====

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Urbanisation and population density are one of the key drivers for enabling access to electricity across the world, with benefits for sustainable development ( [[#Aklin--2018|Aklin et al. 2018]] ). Grid-connected PV systems for urban locations that currently lack electricity access can allow urban areas to leapfrog based on green electrification ( [[#Abid--2021|Abid et al. 2021]] ). In the Global South, the conversion of public transport to electric transport, especially municipal buses (e.g., Bengaluru, India; Jakarta, Indonesia; Medellín, Colombia; Rio de Janeiro, Brazil; Quito, Ecuador) and micro-mobility (e.g., e-trikes in Manila, Philippines) have been quantified based on reductions in GHG and PM 2.5 emissions, avoided premature deaths, and increases in life expectancies ( [[#IEA--2014|IEA 2014]] ; [[#C40%20Cities--2018|C40 Cities 2018]] , 2020b,c,d,e). In 22 Latin American cities, converting 100% of buses and taxis in 2030 to electric was estimated to result in a reduction of 300 MtCO 2 -eq compared to 2017 ( [[#ONU%20Medio%20Ambiente--2017|ONU Medio Ambiente 2017]] ). Yet the scaling up of electric vehicles in cities can be examined within a larger set of possible social objectives, such as reducing congestion and the prioritisation of other forms of mobility.

Electrification requires a layering of policies at the national, state, and local levels. Cities have roles as policy architects, including transit planning (e.g., EV targets and low-emission zones, restrictions on the types of energy use in new buildings), implementers (e.g., building codes and compliance checking, financial incentives to encourage consumer uptake of EVs and heat pumps), and complementary partners to national and state policymaking (e.g., permitting or installation of charging infrastructure) ( [[#Broekhoff--2015|Broekhoff et al. 2015]] ). The number of cities that have instituted e-mobility targets that aim for a certain percentage of EVs sold, in circulation or registered, is increasing ( [[#REN21--2021|REN21 2021]] ). Realising the mitigation potential of electrification will require fiscal and regulatory policies and public investment ( [[#Hall--2017a|Hall et al. 2017a]] ; [[#Deason--2019|Deason and Borgeson 2019]] ; [[#Wappelhorst--2020|Wappelhorst et al. 2020]] ) ( [[#8.5|Section 8.5]] ).

EVs are most rapidly deployed when there has been a suite of policies, including deployment targets, regulations and use incentives (e.g., zero-emission zone mandates, fuel economy standards, building codes), financial incentives (e.g., vehicles, chargers), industrial policies (e.g., subsidies), and fleet procurement ( [[#IEA--2016b|IEA 2016b]] , 2017, 2018, 2020a; [[#Cazzola--2019|Cazzola et al. 2019]] ). The policy mix has included mandates for bus deployment, purchase subsidies, or split ownership of buses and chargers ( [[#IEA--2021b|IEA 2021b]] ) (Chapter 10). Subsidies are often critical to address the often-higher upfront costs of electric devices. In other instances, the uptake of electric induction stoves was increased through government credit and allotment of free electricity ( [[#Martínez--2017|Martínez et al. 2017]] ; [[#Gould--2018|Gould et al. 2018]] ).

Bringing multiple stakeholders together in local decision-making for smart energy systems requires effort beyond usual levels while multi-actor settings can be increased to enable institutional conditions ( [[#Lammers--2019|Lammers and Hoppe 2019]] ). Public participation and community involvement in the planning, design and operation of urban energy projects can be an enabler of decarbonising local energy demands ( [[#Corsini--2019|Corsini et al. 2019]] ). Cooperation across institutions is important for municipalities that are engaged in strategic energy planning and implementation for smart energy systems ( [[#Krog--2019|Krog 2019]] ) ( [[#8.5|Section 8.5]] ).

Electrification technologies can present potential trade-offs that can be minimised through governance strategies, smart grid technologies, circular economy practices, and international cooperation. One consideration is the increase in electricity demand ( [[IPCC:Wg3:Chapter:Chapter-5#5.3.1.1|Section 5.3.1.1]] ). Across 23 megacities in the world (population greater than 10 million people), electrification of the entire gasoline vehicle fleet could increase electricity demand on average by 18% ( [[#Kennedy--2018|Kennedy et al. 2018]] ). How grid capacity will be impacted is dependent on the match between daily electricity loads and supply ( [[#Tarroja--2018|Tarroja et al. 2018]] ). Materials recycling of electrification technologies is also key to minimising potential environmental and social costs ( [[#Church--2018|Church and Crawford 2018]] ; [[#Gaustad--2018|Gaustad et al. 2018]] ; [[#Sovacool--2020|Sovacool et al. 2020]] ) and can ensure electrification reaches its complete mitigation potential. Circular economy strategies are particularly valuable to this goal by creating closed-loop supply chains through recycling, material recovery, repair, and reuse. For instance, the PV CYCLE programme in Europe prevented more than 30,000 metric tonnes of renewable technology from reaching the waste stream ( [[#Sovacool--2020|Sovacool et al. 2020]] ) (Box 10.6 and ‘circular economy’ in Glossary).

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