Smart Electrification: The win-win solution for sustainable world trade

Aharon Amit, General Secretary & CEO, International Electrotechnical Commission (IEC)



While international trade today is largely through the physical transfer of goods, electricity could provide a game changing role in the “virtualisation” of trade while, at the same time, “smart electrification” could bring enormous economic and social benefits to developed and developing countries alike.

We live in a world where there is increasing pressure to stabilize climate impact from fossil fuel use, while meeting the energy demands as the world population rises from 6,5 billion in 2006 to 8,2 billion in 2030. Of course, there are also 1,6 billion people who currently have no access to electricity (and, by implication, are deprived of the inherent benefits in development that such access can bring in terms of education, quality of life, etc.).

Today CO2 emissions related to energy use are at a level of 28 Gt (Gigatonnes of CO2 per annum), which represents 70 % of total greenhouse gas (GHG) emissions. Electricity generation represents something approaching a half of this, at about 11 Gt. Electricity generation today represents 31 % of total global fossil fuel use, and around 40 % of all energy-related CO2 emissions. However, of the fuel used to generate electricity, two thirds are lost in generation and another 9 % in transmission/distribution.

Where is the potential for electricity?

The IEC — as the global developer of International Standards and Conformity Assessment in the field of electricity, electronics and associated technologies — believes that major gains (increases in efficiency and subsequent reductions in GHG emissions) can be made through the use of International Standards using proven technologies that can today save up to 30 % in the efficiency of generation. Furthermore, the IEC is developing the standards to support the development of new technologies that could further increase these efficiency gains.

In the area of power generation and distribution the IEC is developing the infrastructure standards and control/management standards for the electric “smart grid” that optimize production and provision of electric power and enable the sharing of best practices, whatever a region’s or country’s needs. Ultra-high voltage AC, UHVAC (AC transmission whose highest voltage exceeds 1 000 kV) and UHVDC (DC transmission whose highest voltage exceeds 800 kV) are examples of advanced technology for loss reduction by upgrading transmission voltages. Just as importantly, the IEC provides the International Standards for connecting and electrifying rural communities, using grid or stand-alone power generation.

On the demand side, in the home, office or factory, the IEC has and is developing International Standards that can give significant energy efficiency improvements, covering technologies including lighting systems, motors and transformers, while optimizing the use of such devices through “smart” energy management systems.

Decarbonizing electricity generation

The IEC believes that while fossil fuels will continue to play a majority role in world electricity generation, there are significant improvements using existing and future technologies to improve the efficiency of thermal power generation and to “de-carbonize” the processes through, for example, CO2 capture and storage. IEC Standards will help to facilitate the technology transfer of such improvements to all relevant countries.

Renewable energies offer the ultimate in decarbonisation, and the IEC is continuing to develop International Standards covering all technologies covering water, wind, solar, and nuclear. The IEC’s work include standards addressing improvements in the efficiency of well-established tec-nologies, such as those in the hydroelectric sector, while tackling the nascent technologies, as in the case of marine electricity generation.

Virtualization of trade

The down-side to today’s current physical trading model is the use of fossil fuels and subsequent pollution caused by greenhouse gas emissions, which in turn have an influence on climate change. If some of this physical trading could be “virtualised”, then the logic is that the economic benefits of trade can be maintained while the side-effects of physical trade can be mitigated.

The IEC believes that it can play a significant role in one “virtualisation” of trade: electrification. Electrification does not eliminate the physical totally, but it provides a more “virtual” transfer of energy than shipping oil or coal, for example.

Furthermore, if world trade in efficient and low-emission products is promoted — through the use of relevant IEC International Standards and using the global conformity assessment solutions in place — there would clearly be a contribution to more efficient management of the world’s natural resources.

Greater use of information and communications technology can also facilitate further virtualisation of the trading environment. The 2010 eruption of the Eyjafjallajökull volcano in Iceland saw an enforced, increased use of ICT to keep trade flowing through the utilization of “virtual” meetings using web technology and the like.

Electrification offers a great potential for global trade. Increasing the proportion of electricity transmitted and used as a fuel, and correspondingly decreasing the proportion of physical fuels such as oil and coal, implies saving of natural resources. Electricity can be produced with much less impact on the environment than burning fossil fuels for the equivalent energy.

In addition, trade in electricity as the energy vector over long distances is a virtualization when compared to trade in oil and coal over the same distances, and saves natural resources. This is true even with the same source for the fossil fuel: generation local to the fossil fuel deposit and long-distance transmission of electricity is more efficient than long-distance transport of fossil fuel and electricity generation local to the end use.

In conclusion, electricity offers major opportunities to the global market, in terms of social and economic development, while the sharing of the best practices through IEC International Standards can help developed and developing countries combat the energy and climate change challenges of the future.