Turkey rallies world leaders behind goal to electrify 35% of energy use by 2035

Hitting the target would take roughly quadrupling the recent pace of electrification

Turkey’s government is rallying world leaders at climate talks underway in the Turkish resort of Antalya around a target of electrifying 35% of global energy use by 2035, with the Trump administration absent from the negotiations. The goal — “35 by 35,” in the shorthand of the Wall Street Journal analysis Ed Ballard published Thursday — is politically palatable at a time when governments are worrying about fossil-fuel prices anyway, Ballard writes.

Nearly 150 years after Thomas Edison switched on his first lightbulb, electricity still makes up just 23% of the world’s energy, despite Edison’s prediction of a rapid takeover by electric cars, electric trains and solar power. The case for accelerating is efficiency: electricity transfers energy more efficiently than fossil-fuel molecules, and once the heat wasted in engines and boilers is stripped out, electricity provides nearly 40% of useful energy, according to the International Energy Agency. That is why switching to electric cars and heating systems reduces emissions even when the power grid is not perfectly green, the analysis notes.

The problem is not the target but the timing, the analysis argues. Norway, where electric vehicles are the norm, has electrified roughly half of its energy use, the International Energy Agency says. China, Japan and South Korea, for all their high-tech manufacturing, sit at around 30%. Reaching 35% globally by 2035 would imply roughly quadrupling the recent pace of electrification.

Closing the gap, the analysis says, would require unclogging daunting blockages: power transformers and other equipment are in short supply, and so are electricians. The International Renewable Energy Agency says annual global grid spending needs to double to $1 trillion.

Thomas Guennegues, who helps run Polar Capital’s Smart Energy Fund, expects an electrification surge for reasons largely unrelated to climate change. The availability of cheap solar power and batteries should mean more low-cost electricity to go around, he argues, while rapid innovations in demand-side technology make it cost-effective to electrify broader swaths of the economy. Key enablers include power semiconductors — chips that work as high-performance switches — which make it possible to monitor and manage power flows in electric vehicles, charging stations and factories in ways that were not possible a few years ago.

Suppliers of that gear, including Germany’s Infineon, are expanding fast. Those expansions, Guennegues estimates, mean “there is a pathway” to the 2035 target. The analysis appends its own caveat: “But barely.”

One obvious caveat is artificial intelligence, which is a big reason companies like Infineon are expanding in the first place. The analysis notes that the equipment needed to overhaul the existing energy system is being snapped up for data centers by tech companies with practically unlimited budgets. For Guennegues, that makes the AI policy fight crucial: rapidly electrifying the non-data-center portion of the economy depends on ensuring that AI spending helps fund a broader grid makeover.

Eli Horton, who runs an energy-focused strategy at fund manager TCW, is more doubtful about the prospects for a dramatic step-up in the rate of electrification. In Horton’s account, established industrial companies, such as makers of gas turbines and transformers, are wary of overexpanding. Companies in his portfolio face shortages of everything from linemen to cooling coils for HVAC systems.

Horton expects the adjustment to be painful — and lucrative for whoever holds the scarce gear, which the analysis calls prized picks and shovels. Viewed as an investment thesis, constraints are appealing because they confer pricing power, the analysis notes. “We do like to invest in bottlenecks,” Horton said.

Also in the WSJ Climate & Energy newsletter

The newsletter edition carrying the analysis, written by Ed Ballard in London, reported several additional items.

The cost of power in wildfire country. Pacific Power, a California utility owned by Berkshire Hathaway’s PacifiCorp, faces a costly problem: it has a small customer base to share the expense of hardening the grid in a fire-prone part of Northern California. The utility is seeking a rate increase that would add $120 to the typical monthly bill, the newsletter reported.

Energy-permitting latest. The permitting bill being considered by the outgoing Congress rewrites major regulations in a way that looks favorable to big tech companies. The bill’s chances of securing Democrats’ backing took a hit this week when President Trump said he wouldn’t approve wind-energy projects, according to the newsletter.

Iran war expected to reduce carbon-dioxide emissions. The surge in energy prices sparked by the blockage of the Strait of Hormuz cut oil consumption but had remarkably little impact on growth. That came as a surprise to many companies and economists, and suggests that economies are less oil-dependent than they were in previous crises, the newsletter reported.

The polar vortex. The rapidly circulating wind system that traps cold air in the Arctic has been slowing, and this week it went into reverse when temperatures spiked in the air high above the polar region. Such “sudden stratospheric warming” events are not unusual, but this is the earliest on record, the newsletter said. The reversal could send cold weather spilling southward — bad news for heating bills at a time when supplies of natural gas and diesel are tight. Long-range weather forecasts suggest the vortex could strengthen again later in the winter; for now, though, the reversal complicates a weather outlook otherwise dominated by a strong El Niño that is likely to mean a mild winter in Europe and the northern U.S. Whether a hotter world brings more such events is unclear: climate models do not agree on whether global warming will mean more sudden stratospheric warming events, University of St. Andrews climate scientist Simon Lee said in a social-media post.

Red Sea shipping. The newsletter also opened with a line from a September email — “We hope you are keeping well.” — in which an administrative office run by Yemen’s Houthi militants gave their blessing to a Chinese ship seeking safe passage in the Red Sea. The newsletter described the story as a window into how the Houthis coordinate the flow of maritime traffic.