Biodiversity
21 march 2025
Electrification: the photovoltaic ecosystem
What exactly do we mean by electrification? Electrification refers to the decarbonisation of final energy consumption through the integration of renewable technologies.
Increasing electrification supports the use of renewable energy, helping reduce Greenhouse Gas (GHG) emissions and improving energy efficiency—for example, through self-consumption installations.
By Paula Santos
Why is electrification necessary?
The energy transition is well underway—and there’s no turning back. For many years now, we’ve been analysing how to gradually replace fossil fuels with renewable energy sources. And those efforts are paying off: according to Red Eléctrica de España (REE), renewable energy sources accounted for around 56% of Spain’s total electricity mix in 2024. This figure represents roughly six percentage points higher than the record set in 2023.
The target set by Spain’s National Integrated Energy and Climate Plan (NECP)—a roadmap for the energy transition led by the Ministry for the Ecological Transition—is 81% by 2030. This suggests that, despite some ongoing challenges, we’re on the right path. There’s no doubt that the transformation of the electricity generation mix is already happening.
However, we must not focus solely on generation—we also need to replace fossil fuels used in final consumption. It does little good to ensure a clean generation mix if we still rely on gas to heat our homes and power our industries.
That’s why decarbonisation through electrification of end uses must progress in step with the growing integration of renewables into the generation mix.
But electrification is not a simple process. It requires careful analysis and the selection of the most suitable technologies for each sector. In most cases, electrification needs are driven by heating, cooling, and domestic hot water. And those needs vary by sector—residential, commercial, industrial, and transport.
The photovoltaic ecosystem
Among renewable technologies, solar photovoltaic has become a cornerstone of the energy transition—not only because of its ability to produce clean energy and the dramatic cost reductions seen in recent years, but also due to its flexibility and modularity. Photovoltaic systems can be installed close to the point of consumption, enabling the growth of self-consumption and energy communities.
According to the Electricity 2025 report by the International Energy Agency, photovoltaic solar will be the leading technology driving the electrification of final consumption. By 2027, PV is expected to cover about half of the projected increase in electricity demand, thanks to its ongoing cost reductions.
Self-consumption PV is a key ally in the electrification process, as it allows electricity to be generated and consumed on-site—using, for example, heat pumps or electric vehicles in residential areas or integrating with green hydrogen production in the industrial sector.
We can speak of a photovoltaic ecosystem: PV self-consumption opens up multiple options and combinations for electrification. It also reduces the amount of electricity we draw from the grid, generating savings and making the system far more efficient.
It’s a win-win system: you use electricity produced on your own rooftop to power a heat pump that warms your home while contributing to eliminating gas usage and reducing costs.
Proposals: how can we accelerate electrification?
The National Integrated Energy and Climate Plan (NECP) outlines a series of objectives and measures to drive decarbonisation across key sectors of the economy.
One of its goals is to increase the share of final electricity use to 35% by 2030, with a range of initiatives focused on new projects and energy carriers.
This would mean a 34% increase in electricity demand over the decade.
Source: Ministry for the Ecological Transition and Demographic Challenge (MITECO). National Integrated Energy and Climate Plan (NECP).
OBJETIVOS SECTORIALES Y POR TECNOLOGÍA
En el PNIEC 2021 se establecieron los siguientes objetivos:
- Eólica: 50 GW, incluyendo entre 1 y 3 GW de eólica offshore.
- Solar FV: 39 GW, con entre 9 y 14 GW de autoconsumo.
- Hidrógeno renovable (potencia de electrolizadores): 4 GW.
- Biogás: 10,4 TWh.
- Almacenamiento: 20 GW.
- Eficiencia en la edificación y rehabilitación de viviendas: 1.200.000 viviendas.
- Vehículo eléctrico: 5 millones de unidades.
- Electrificación (porcentaje sobre energía final): 32%.
- Demanda eléctrica en comparación con 2019: +5%.
En el PNIEC 2023, estos objetivos fueron actualizados:
- Eólica: 62 GW, incluyendo 3 GW de eólica offshore.
- Solar FV: 76 GW, con 19 GW de autoconsumo.
- Hidrógeno renovable (potencia de electrolizadores): 12 GW.
- Biogás: 20 TWh.
- Almacenamiento: 22,5 GW.
- Eficiencia en la edificación y rehabilitación de viviendas: 1.377.000 viviendas.
- Vehículo eléctrico: 5,5 millones de unidades.
- Electrificación (porcentaje sobre energía final): 35%.
- Demanda eléctrica en comparación con 2019: +34%.
To achieve those goals, a variety of actions and measures must be put in place:
- Expanding the use of PV technology in end uses by promoting more self-consumption systems and supporting the development of energy communities.
- Developing the PV ecosystem by creating incentives that encourage hybrid systems, such as:
- Replacing traditional appliances (e.g., gas boilers) with heat pumps.
- Encouraging the adoption of electric vehicles over internal combustion ones, along with a coordinated rollout of charging infrastructure.
- Introducing electric boilers for industrial use where feasible, as well as green hydrogen solutions.
- Improving energy efficiency, which goes hand in hand with electrification across all sectors.
- Upgrading electricity grids to make them smarter and more flexible through digitalisation.
- Increasing system flexibility by integrating storage systems that support grid stability and balance.
- Rolling out financial incentives to promote electrification:
- Tax breaks for electrifying technologies such as self-consumption systems, heat pumps, and EV chargers.
- Reviewing electricity taxes.
- Adjusting electricity tariffs to raise the variable component of the bill.
- Offering subsidies for the purchase of electrification equipment.
- Expanding tools like Energy Savings Certificates (ESCs) to include electrification systems.
There’s still a lot of work ahead—but we’re clearly moving in the right direction.
