Report for G7 shows how urban planning, digitalisation and grid investment can help cities manage the impacts of climate change and growing energy demand
Reducing emissions in cities is essential for the world to meet its energy and climate goals – and digital solutions that manage consumption patterns and optimise infrastructure can play a significant role, according to a new report by the International Energy Agency (IEA).
Empowering Urban Energy Transitions: Smart Cities and Smart Grids – the third report in the flagship series from the IEA’s Digital Demand-Driven Electricity Networks Initiative (3DEN) – was presented at the G7 Climate, Energy and Environment Ministerial Meeting this week in Turin, Italy, and acknowledged by ministers in their communique. It explores a large range of innovative projects and initiatives to improve power systems in cities around the world and provides insights on emerging best practices.
The report finds that cities need to raise their level of ambition in areas such as energy efficiency to meet the targets set at the COP28 climate change conference in Dubai. While a small number of cities are stepping up through sustainability and carbon dioxide (CO2) reduction targets, more need to come forward. Cities currently account for around three-quarters of global energy consumption and 70% of greenhouse gas emissions, and their contribution is set to rise. Despite this, only one in five cities has set a target to reach net zero emissions.
Meanwhile, cities are getting bigger, with urban growth by 2050 set to be equivalent to adding the combined land area of Germany, Italy and Japan. Climate change is also posing new challenges as cities become larger and more densely populated – particularly during heat waves. In the hottest regions, electricity consumption can double in warm months versus milder ones, with cooling accounting for over 70% of peak electricity demand. This – in addition to the growing electrification of the energy sector in cities, as more people use technologies such as heat pumps and electric cars – places strains on electricity distribution infrastructure.
The report finds that digital solutions, including those that make electricity networks more flexible, can help. However, greater investment is needed. On a global net zero pathway, annual investment in grids worldwide needs to more than double by 2030 to USD 750 billion. Approximately 75% of spending would need to go towards expanding, strengthening and digitalising distribution grids, including in cities, to improve system efficiency and manage more complex flows of electricity and data.
According to the report, better alignment of planning timelines is important to reduce the risk of power outages and cut backlogs for new electricity connections for renewable assets, electric vehicle chargers, businesses and housing developments. Misaligned planning can delay the deployment of renewable energy, constrain efforts to improve energy efficiency and lead to higher electricity costs for consumers, it notes.
Improved access to and use of data for decision making would also support faster and more targeted implementation of energy and climate goals and help align city and power system planning. Digital solutions and systems can be particularly powerful in cities, where high-density environments create economies of scale and can optimise infrastructure and create new opportunities. The number of connected sensors and devices is set to rise sharply by 2030, according to the report.
Empowering Urban Energy Transitions highlights the role of G7 countries in fostering innovation through greater international collaboration. It suggests creating enabling environments at the city level for scalable pilot projects, and notes that integrated urban and power system planning – together with improved data sharing – are crucial to maintain electricity security and prioritise people in clean energy transitions. The report also explores the value of 3DEN pilot projects administered by the United Nations Environment Programme (UNEP) in Brazil, Colombia, India and Morocco, which leverage advanced digital technologies to improve energy management, enhance affordability and manage grid flexibility.
As national policy makers consider how to best enable secure clean energy transitions in cities, the report suggests four key themes for them to consider:
- Placing people at the centre of policy making in order to build for the future
- Supporting data-driven integrated planning to ensure that grids are fit for purpose
- Addressing specific areas of focus to create a supportive environment
- Pursuing the benefits of fostering strengthened international co-operation
The IEA will host a webinar to present the report’s findings on 16 May.
3DEN is the IEA’s initiative to accelerate progress on power system modernisation backed by Italy’s Ministry of Environment and Energy Security. After a successful first phase, the initiative will continue into a second phase of work starting from 2025.
FAQs
Energy transition refers to the global energy sector's shift from fossil-based systems of energy production and consumption — including oil, natural gas and coal — to renewable energy sources like wind and solar, as well as lithium-ion batteries.
Why is energy transition important? ›
The energy transition, after an initial investment, can reduce energy bills and industrial costs, thereby freeing up capital for investment in other areas such as sustainable business and development models.
What are the drivers of the energy transition? ›
Our analysis shows that five key technologies are projected to be major drivers of the energy transition: solar, wind, EVs, heat pumps, and green hydrogen.
Is there a clean energy plan in North Carolina? ›
Clean Energy Plan Goals
Reduce electric power sector greenhouse gas emissions by 70% below 2005 levels by 2030 and attain carbon neutrality by 2050. Foster long-term energy affordability and price stability for North Carolina's residents and businesses by modernizing regulatory and planning processes.
What is the role of the IEA energy efficiency? ›
Energy efficiency is the single largest measure to avoid energy demand in the Net Zero Emissions by 2050 (NZE) Scenario, along with the closely related measures of electrification, behavioural change, digitalisation and material efficiency.
How does the IEA work? ›
The International Energy Agency (IEA) is a Paris-based autonomous intergovernmental organisation, established in 1974, that provides policy recommendations, analysis and data on the global energy sector. The 31 member countries and 13 association countries of the IEA represent 75% of global energy demand.
What are the problems with the energy transition? ›
These four challenges—energy security, macroeconomic impacts, the North-South divide, and minerals—will each have significant effects on how the energy transition unfolds.
What excites you most about the energy transition? ›
Millions of americans are being freed from dirty fossil fuels and unlocking endlessly renewing wind and sun to power their homes. That's extremely exciting. The transition to clean renewable energy is often framed around avoiding the worst outcomes of climate change.
What are the effects of the energy transition? ›
Energy transition will trigger a wide range of social effects, bringing about changes in areas such as energy accessibility, employment access, and public health. In the era of low-carbon energy transition, there are increasing concerns about the intensification of energy poverty [101].
How can we transition to clean energy? ›
Here are four ways to cost-effectively make the shift from fossils to cleaner energy systems:
- Eliminate fossil fuels subsidies and put a price on carbon. ...
- Step up investment in energy efficiency. ...
- Create the conditions for phasing out coal. ...
- Improve access to electricity and clean cooking.
Derived from natural resources, green energy is also often renewable and clean, meaning that they emit no or few greenhouse gases and are often readily available.
What is one of the major difficulties with using renewable energy? ›
Renewable energy sources generate most of their energy at certain times of the day. Its electricity generation does not match with the peak demand hours. The intermittency of sunshine and wind cannot provide an on-demand power source 24 hours a week. Solar energy and wind are unpredictable.
Will clean energy be cheaper? ›
Renewable energy already beats fossil fuels on cost globally — and according to analysts, the gap is only going to grow. By 2030, technology improvements could slash today's prices by a quarter for wind and by half for solar, according to the authors of a recent report from clean energy think tank RMI.
What states are clean choice energy? ›
For residents in Delaware, Illinois, Maryland, Massachusetts, New Jersey, New York, Ohio, Pennsylvania, and Washington, D.C., we offer 100% clean electricity from wind and solar sources.
How affordable is clean energy? ›
Renewables are the cheapest form of power today confirms a new report from the International Renewable Energy Agency. Amid climbing fossil fuel prices, investments in renewables in 2021 saves US$55 billion in global energy generation costs in 2022.
What is the IEA energy trilemma? ›
The World Energy Trilemma Report 2024 identifies emerging trends affecting energy security, equity, and sustainability, laying the groundwork for the evolution of the Trilemma framework and its dimensions, extending its use and enabling real-time application through accessible data, new metrics, and expanded practical ...
What is energy transition in United States? ›
Together, renewables combined with energy storage dominated new utility-scale generation sources, representing more than three-quarters of total new capacity added (see graphic below). Renewables, including large hydropower, represented about 25% of electricity generated in the United States in the first half of 2023.
What is the IEA projection for renewable energy? ›
As it stands, the new report concludes that under the IEA's “main case” forecast, shown in yellow in the chart below, renewable capacity would increase to 7,339GW in 2028. Following that trajectory, capacity would reach around 9,000GW in 2030 – roughly an increase to 2.5 times current levels.
