A Positive Tipping Cascade in Power, Transport and Heating
To keep Paris goals in sight, we need to decarbonise 5x faster. This means that all emitting sectors need to transition at the same time. However, these transitions are interrelated, and a transition in one may help accelerate or decelerate the transition in another. For instance, innovation in batteries, driven by the EV revolution, can drive down costs for applications in freight and the power sector. And cheaper electricity due to the expansion of cheap renewables can help make heat pumps more attractive. However, higher electricity demand may drive expansions in fossil fuels, or there may be spatial constraints on renewables expansion in densely populated areas.
This report investigates the simultaneous transition in the power sector, personal transport, trucking, and residential heating. We find two superleverage points: sector-specific policies with an outsized effect on other sectors. Firstly, an EV mandate, which helps other sectors via the creation of a second-hand battery market for grid applications, vehicle-to-grid, and via induced innovation bringing down battery costs. The second one is a coal phase-out before 2035 in rich countries and before 2045 in developing countries, allowing cheap renewables to dominate the grid. Overall, the whole transition is faster than the sum of its parts and cost-parity points are reached up to 4 years earlier in some countries from cross-sectoral sector impacts.
