Industrial Electrification 2024

Through a series of multistakeholder dialogues facilitated by the World Economic Forum, several key challenges were identified that risk impeding industrial electrification progress: Strategies for improving the business and economic case for industrial electrification FIGURE 2 Collaborate on shared regional vision and action plans across the value chain Public-private collaborationIndustrial Electrification Strategies and Policies for Europe 1Create integrated public funding and risk sharing models2Develop regional certified financial models for electrification investment3 Support the development of a mature vendor and supplier ecosystem Business and market enablers4Streamline access to private finance and investment support5Capture and expand markets for green products6 Consider advancing proposed revisions to the Energy Taxation Directive Policy and regulatory7Expand the Industrial Emissions Directive8Ensure EU Action Plan fo Grids targets industrial electrification9The Forum’s dialogues focused on public-private collaboration, business and market enablers, and regulatory frameworks, resulting in nine actions and strategies to strengthen the business case for industrial electrification. While these strategies are adapted for Europe, many could apply to other global markets (see Figure 2).Clean power availability and price: Delays in accessing a reliable grid or system with sufficient capacity remain challenging. In addition, the uncertainty about electricity prices compared to other feedstock alternatives (e.g. natural gas, biogas, etc.) is highlighted as a key concern in decision-making for industrial electrification projects. Limited financing support: High interest rates and lack of risk-sharing mechanisms make it difficult for businesses to secure funding for electrification projects against other alternatives with more immediate returns.Risk aversion for new technologies: Industrial companies are reluctant to invest in newer, less proven technologies, as they are perceived as riskier due to limited case studies to validate their effectiveness or sufficient financial returns. With current assets having long lifecycles, upgrading before these assets near the end of their use is both challenging and costly, even if it promises improved efficiencies. Industrial Electrification: Strategies and Policies for Europe 4