Direct electrification · Glossary

Direct electrification refers to replacing fossil fuels by using electricity directly in an application. A gas heating system is replaced by a heat pump, an internal combustion engine by an electric motor, a fossil-fired industrial furnace by an electric furnace, an electrode boiler or another electric heat application. The electricity is not first converted into another energy carrier such as hydrogen, methane or synthetic fuel. It is converted directly into heat, motion, light or process energy.

The term therefore does not stand for a specific technology but for a transition pathway. It describes the route by which an energy service previously provided with fossil fuels will be supplied in future. The service itself remains comparable: a building is heated, a vehicle is moved, a material is heated. The upstream energy chain, however, changes fundamentally. Fuel delivery, combustion and exhaust gas give way to a chain of electricity generation, grid transport, electrical conversion and control.

Distinction from electrification and indirect electrification

Direct electrification is one part of general electrification. Electrification can mean any shift of applications towards electricity, even if electricity is only an intermediate step. In indirect electrification, electricity is first used to produce another energy carrier, such as green hydrogen, synthetic methane or electricity-based liquid fuels (e-fuels). These energy carriers can replace fossil fuels. However, a considerable share of the electrical energy used is lost during production, storage, transport and later use.

The passenger car comparison by the German Federal Environment Ministry shows how large the difference can be: starting from renewable electricity, a battery-electric car converts about 64 percent of the energy input into motion, a hydrogen fuel-cell car about 27 percent. A petrol car achieves about 20 percent, calculated from the energy source to the wheel. A combustion-engine car running on synthetic fuel additionally requires electrolysis and fuel synthesis, and then converts the fuel into motion with the low efficiency of an internal combustion engine. This chain is therefore still clearly less favourable. Such values depend on assumptions and should be read as orders of magnitude, not as fixed constants.

The distinction is important because the two pathways place different demands on the electricity system. A heat pump needs electricity at the location and roughly at the time of the heat demand, unless it works with a heat store or uses the thermal mass of the building. Hydrogen production can be adapted more strongly to periods of high renewable feed-in. However, it requires electrolysers, storage, transport infrastructure and consumers that can use hydrogen in a technically sensible way.

Direct electrification is also not synonymous with decarbonisation. If the electricity used comes predominantly from fossil power plants, emissions fall only to a limited extent, depending on the application. According to the International Energy Agency (IEA), 50 to 65 percent is typically lost as waste heat when fuels are used to generate electricity. The climate benefit grows as the share of renewable energy in the electricity mix increases. The IEA notes that electrification reduces the energy sector's CO2 emissions in all cases examined. For large reductions, however, low-emission electricity generation must at the same time be expanded significantly.

Why the direct use of electricity is often more efficient

The key advantage lies in lower conversion losses. When electricity is used directly, several conversion stages are eliminated. According to the IEA, an electric car is two to four times as efficient as a vehicle with an internal combustion engine. For its comparative calculations, the IEA assumes about 90 percent efficiency for a battery-electric car and about 25 percent for a petrol car. A heat pump does not simply convert electricity into heat but lifts ambient heat from air, ground or water to a usable temperature level. From one kilowatt-hour of electricity, typically three to five kilowatt-hours of heat are produced. A gas boiler, by contrast, achieves an efficiency of less than one. For a momentary snapshot this ratio is called the coefficient of performance; measured over a whole year it is the seasonal performance factor. In real operation the value depends strongly on source temperature, flow temperature and planning.

For electric process heat, the advantage depends more strongly on temperature, material, mode of operation and the existing plant. Low-temperature heat can often be electrified well. In an analysis for the EU, the IEA assumes that industrial heat pumps can supply heat up to about 150 °C. Above that, electric boilers, resistance heaters or arc furnaces come into consideration. These methods do not have the same efficiency advantage as heat pumps and, according to the IEA, are currently mostly not competitive with natural gas for baseload heat. At very high temperatures, in chemical reduction processes or at complex integrated sites, direct electrification can be technically demanding or economically viable only under certain conditions. The term is therefore not a blanket statement that every application can be operated immediately and fully electrically.

Efficiency affects overall energy demand. If a car needs less final energy per kilometre or a heat pump delivers several kilowatt-hours of heat from one kilowatt-hour of electricity, final energy consumption can fall even though electricity consumption rises. More electricity sales therefore do not automatically mean higher total energy demand. Rather, they can show that lossy fossil applications are being displaced. The IEA describes the same relationship from a cost perspective: per kilowatt-hour of final energy, electricity is almost always more expensive than natural gas or petrol. Because electric devices are more efficient, however, it often delivers significantly more usable energy service per kilowatt-hour. Worldwide, electricity accounted for about 23 percent of final energy consumption in 2025.

Significance for power grids, load profiles and flexibility

Direct electrification shifts energy demand into the electricity system. This changes load profiles, grid loads and the need for generation capacity. A single heat pump, charging point or electric furnace is technically easy to manage. In large numbers, however, new simultaneity effects arise: many heat pumps run at high output at the same time in cold weather, many electric cars are charged in the evening after people return home, and industrial electric processes can push existing grid connections to their limits. According to an IEA analysis, a heat pump in a household that does not at the same time improve building efficiency can almost triple its winter peak load. A better building envelope can significantly reduce heating energy demand and allow smaller devices.

For the electricity system, therefore, it is not only the additional amount of energy in kilowatt-hours that matters. Equally important is the power required at specific times. A kilowatt-hour on a windy night affects generation, grid and market differently from a kilowatt-hour at high evening load and low renewable feed-in. Direct electrification thus increases the value of flexibility: charging can be shifted, heat pumps can be coupled with building mass or heat stores, and some industrial processes can be adjusted in time.

This flexibility does not arise by itself. It requires price signals, controllable devices, suitable grid connections, digital metering systems, clear rules on intervention and business models in which the benefit also reaches the operators of the installations. In Germany, Section 14a of the Energy Industry Act (Energiewirtschaftsgesetz) regulates the grid-oriented control of controllable consumption devices. These include in particular heat pumps, non-publicly accessible charging points for electric vehicles, systems for cooling or electricity storage, and night storage heaters, unless the Federal Network Agency (Bundesnetzagentur) determines otherwise. In return for being controllable, reduced grid charges apply. The law expressly gives economic incentives priority over the control of individual devices. Grid operators who exercise control must monitor and digitalise their grid more closely. The details, such as power thresholds and charge modules, are determined by the Federal Network Agency.

Typical misconceptions

Emissions are merely shifted to the power plant: This view stems from a predominantly fossil electricity system. As the shares of wind and solar power grow, an electric application can become ever lower in emissions over its service life. A fossil burner, by contrast, remains tied to the carbon content of its fuel.
Direct electrification is always the cheapest solution: Operating costs can be low if electricity price, efficiency and usage profile fit. However, total costs also depend on investment, grid connection, building renovation, charging infrastructure, process conversion and financing. A well-planned heat pump with suitable heat emitters is something different from an oversized system in an unrenovated building. The IEA also stresses high upfront investments, which in part require policy support or low-cost capital.
The grid fundamentally cannot absorb the additional load: Grid bottlenecks are real, but they differ spatially, temporally and technically. Some distribution grids need reinforcement. Others can initially absorb more than blanket statements suggest, through grid-friendly charging, local control and better utilisation of existing equipment. Conflicts arise above all where new consumers are installed faster than grid planning, connection procedures, regulation and tariffs are adapted.
Electricity or hydrogen, only one of them: It makes more sense to allocate by application. Electricity should be used directly where this is technically well possible and efficient. Hydrogen and electricity-based energy carriers are relevant above all where direct electric use is difficult, for example in certain chemical processes, as a reducing agent in steelmaking, for long-term storage or in parts of aviation and shipping. The IEA also names long-haul aviation and shipping as hard to electrify.

Institutional and economic consequences

Direct electrification changes responsibilities. Previously, many energy questions lay outside the electricity system: heating oil was delivered, natural gas was distributed through gas networks, fuel was sold at filling stations. With heat pumps, electric vehicles and electric process heat, distribution system operators, electricity suppliers, metering point operators, aggregators, device manufacturers, installation companies and regulators move into the same chain. Errors at one point have knock-on effects. A low wholesale electricity price helps little if a household cannot use a time-variable tariff. A controllable electric car does not relieve the grid if charging point, metering system and contract do not work together.

The distribution of costs is also being renegotiated. Grid expansion, metering infrastructure and flexible control cost money but can avoid more expensive alternatives. If all costs are passed on across the board per kilowatt-hour, electricity for electric applications can be made artificially more expensive even though these replace fossil energy and save energy overall. If grid bottlenecks are ignored, higher costs arise elsewhere, for example for redispatch, connection delays or local grid reinforcements. Direct electrification thus makes visible whether price and regulatory rules fit the technical transformation.

In the end, the term does not describe a simple change of device but a new coupling between consumers and the electricity system. Direct electrification has the strongest effect when high efficiencies, renewable electricity, flexible operation and suitable infrastructure come together. It does not solve every task of the energy transition. But it marks the area in which replacing fossil combustion with direct use of electricity can significantly reduce energy demand while at the same time placing new demands on grids, markets and control.

Sources

Electrification – The Age of Electricity (Special report) — International Energy Agency (IEA); 2026 (genaues Datum unbekannt). Abschnitte 'The Age of Electricity', 'Electrification in end-uses' und 'Implications of electrification'
The energy crisis creates even stronger impetus for EU electrification — International Energy Agency (IEA); 2026 (genaues Datum unbekannt). Abschnitt 'Heat pumps are competitive for 40% of low-temperature industrial heat' mit Anmerkungen
§ 14a EnWG – Netzorientierte Steuerung von steuerbaren Verbrauchseinrichtungen und steuerbaren Netzanschlüssen; Festlegungskompetenzen — Bundesministerium der Justiz / gesetze-im-internet.de; unbekannt (jeweils aktuelle Fassung). § 14a Abs. 1 und Abs. 3 EnWG
Wirkungsgrad: Elektroautos liegen weit vorn (Infografik) — Bundesministerium für Umwelt, Klimaschutz, Naturschutz und nukleare Sicherheit (BMUKN); unbekannt. Infografik und Bildbeschreibung
The Future of Heat Pumps – Executive Summary — International Energy Agency (IEA); 2022 (genaues Datum unbekannt). Executive Summary

Related glossary entries

Edited by eCMS on 11.11.2026 19:12