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Solar PV and wind supply about 40% of building electricity use by 2030

Part of Technology and innovation pathways for zero-carbon-ready buildings by 2030

About this report

This analysis is part of a series from our new report, Technology and innovation pathways for zero-carbon-ready buildings by 2030, and provides the strategic vision of experts from the IEA Technology Collaboration Programmes (TCPs) on how to help achieve some of the most impactful short-term milestones for the buildings sector outlined in the IEA’s Net Zero by 2050 Roadmap; each report’s title reflects one of these milestones. Learn more about the report and explore the TCPs.

Highlights

Expanding the share of electricity in buildings’ final energy consumption is a key milestone to reach in the Net Zero Emissions by 2050 Scenario (NZE Scenario), which sees solar and wind supply used in electricity generation rise from 9% in 2020 to 40% in 2030. The gains will be underpinned by increased electrification of space heating and hot water generation, and the growing demand for space cooling and electrical appliances. Driven by technology cost reductions, policy support and technology maturity, the share of solar PV and wind in electricity generation will reach 68% by 2050 in the NZE Scenario.

To bridge the gap between variable renewable energy production and time of use, the inclusion of electrical and thermal (power-to-heat by electrically-driven heat pumps) energy storage as well as flexibility mechanisms like dynamic pricing and smart home controls is required. By 2030, buildings increasingly become a source of flexibility for the energy system, enabling efficient coupling of variable PV and wind with the use of electricity for building purposes (e.g. heating/cooling). Bidirectional charging of electrical vehicles can be facilitated by flexibility in smart grids and energy storage, either in the form of batteries (also car batteries) or thermal storage (hot and cold storage). In combination with economic drivers, flexibility and energy storage deployed in smart buildings are expected to further advance energy conscious behaviour and uptake at the consumer and commercial levels.

Schematic of the Comfort Climate Box for zero-carbon-ready buildings

Schematic of the Comfort Climate Box for zero-carbon-ready buildings

Source: IEA ES TCP Task 34, Comfort Climate Box.


Relevance

Reaching 40% of the building sector’s electricity demand by wind and PV goes hand in hand with a transformation of energy demand in buildings. While current wind and PV production can be absorbed by the building demand, increased electricity generation from variable renewables and the design of energy systems at the building and district level will need to be adopted. In the context of shifting and growing electricity consumption profiles for heating, cooling and appliances, as well as higher demand due to electric vehicles (EVs), energy storage solutions within buildings integrating smart/automatised controls will be required to further increase the share of renewable electricity to over 40% and contribute to a more resilient energy system.

On-site and district level solar PV installations are an easy option to decarbonise the energy supply and to increase the deployment of nearby renewable production. Balancing demand (including heating/cooling which account for the majority of energy demand) close to energy supply will reduce costs induced by congestion, distribution or fees of grid operators.

A substantial part of building-level PV is generated when it is not needed. Self-consumption can be increased by demand response of smart appliances whose use can be shifted to times of high PV production and storage (including bidirectional EV charging). Storage options can be electrical, but also thermal enhanced by heat pumps or chillers. In some cases, excess electricity can be stored in local (neighbourhood) storages that should be used in a coordinated way among buildings for short-term or even seasonal periods.

Current state

Energy storage solutions are a mass-market technology for a number of applications in many parts of the world. The costs per energy storage unit for an average building are easing due to technological developments, innovation, and economies of scale. With rising prices of fossil fuels and CO2 allowances, the competitive advantage of decarbonised solutions becomes more favourable. For emerging markets, investments in grid infrastructure can be reduced by deploying energy storage technologies.

Emerging smart building and smart grid solutions include appliances that trigger on injections to the grid to start or increase consumption. Building energy management systems that coordinate multiple smart appliances, storage and communicate with other buildings and grid stakeholders to ensure grid-secure flex activations are also evolving.

Not only is electrification of building end-uses progressing, but the evolution in computing and forecasting technologies, such as widespread instrumentation and advanced computer models, among others, allow for better response to intermittency issues of renewable energy sources (RES). This is further supported by demand-side response technology advances (smart meters coupled with intelligent appliances such as heat pumps, air conditioners, and white goods) and increasing deployment of smart inverters (inverters and power electronics that can provide grid support and control to system operators). Lastly, real-time system awareness and management solutions (instrumentation and control equipment across transmission and distributions networks) enable system operators to actively manage grid behaviour.

Challenges

Although operational costs could become very competitive compared to traditional systems, upfront capital costs are limiting access to emerging smart solutions. Aside from the initial costs, comfort and ease of operation are expected to help speed up users’ acceptance.

To promote the integration of energy storage technologies, solving some physical adaptations will be required, including reducing the size of storage systems by increasing their energy density. In terms of system integration, emphasis should be placed on interoperability of different technologies when coupling various load patterns like heating/cooling, and EV charging at the building level. Building energy management systems that take frequent automated actions based on flexible time-of-use pricing structures are not widespread and should be accelerated. Nevertheless, the coordinated actions among management systems will be required to mitigate the risk stemming from overreactions to market signals.

Even though the variability of electricity generation is increasing, reaching this milestone must go in tandem with ensuring power system reliability. Traditional electricity infrastructure networks need to become dynamic to facilitate the non-dispatchable renewable energy production with load patterns and more variable electricity demand. 

Innovation themes covered by the IEA TCPs
Policy recommendations

Strategies

Policy recommendations

Market creation and standards

 

Ban fossil fuels

Bans. Phase out new fossil fuels installations in buildings to accelerate electrification from clean energy provided by solar PV and wind.

Smart-grid readiness, safety labelling and minimum energy performance standards (MEPs)

MEPS and labels. Introduce smart-grid readiness indicators as part of standards, e.g. heat pumps, and safety codes for installers of energy storage systems.

Planning instruments

 

Plan over the long term

National and local energy planning. Ensure long-run planning certainty through regulatory backstops to coordinate capacity building and investments.

Economic and financial instruments

 

Deploy financial instruments to reduce renewables upfront cost

Subsidies. Provide funding for energy-poor, low-income and vulnerable people through targeted subsidies.

Enable innovative business models

Regulation. Support smart-grid solutions related to the integration of renewable electricity in buildings with new regulatory approaches in anticipation on more system flexibility (including energy storage).

Cooperation-based instruments

 

Develop open-source platforms and tools

National open-source information databases. Promote the development of information platforms where different stakeholders can communicate and share best practices on technology interaction (e.g. EVs, PV production, heat pumps, etc.).

Public support to R&D

 

Preferential access to data

Information databases. Allow preferential access to data to support research for buildings system optimisation.

Education and training

 

Capacity building

Capacity building. Develop and launch campaigns across entire solar PV and wind supply chains to support technology deployment.

Analysis