The Primary Energy Fallacy

While Germany already covers more than half of its electricity needs with renewables ¹, the share of renewables in primary energy consumption is relatively small at just under 20 percent².

This argument is often used when discussing the potential of the energy transition—that the conversion of the electricity sector is feasible, but a conversion of the primary energy supply will not be manageable through renewables. This is a widespread fallacy.

As Jan Rosenow describes in his paper “Have we been duped by primary energy fallacy?”³, the crucial mistake made when looking at primary energy is failing to include differences in efficiency and the degrees of effectiveness of technologies. Put simply, one does not have to replace all primary energy with renewables if new technologies provide the same energy services more efficiently.

The Fallacy of Fossil Dependency

Primary energy consumption is composed of the energy content of untreated and natural energy sources such as coal or crude oil, which can be used directly but are usually first converted into more consumer-friendly secondary energy sources such as gasoline or electricity. Primary energy consumption is calculated as the sum of all energy sources produced domestically plus the balance of imported and exported quantities, as well as changes in inventory levels, minus stocks bunkered on the high seas². The fallacy that leads many people to believe that the supply of fossil fuels is insurmountable consists of equating inputs (coal, oil) with outputs (heat, transport). Equating primary energy inputs with energy services or outputs vastly overrepresents conventional energy sources³.

Germany not only imports the majority of its primary energy requirements, but almost 20 percent of the energy is lost during conversion processes before the energy service is provided. The reason for these losses lies primarily in the technology. While renewable sources such as solar and wind provide electricity directly, fossil fuels must first be converted. On average, the efficiency of fossil fuel power plants in Germany is only 45 percent⁵. Authorities such as the IEA or EIA previously even multiplied shares of renewable primary energy sources such as hydropower by a so-called Fossil Fuel Equivalency Factor of about 3 (partial substitution method)⁶ to make their theoretical primary energy impact comparable to fossil energy sources. This inefficiency is not only harmful to the environment but also expensive—in 2024 alone, Germany imported gas worth 19 billion euros and oil worth 45 billion euros⁷. The loss during energy conversion therefore costs the German economy over 10 billion euros annually. Although the overall efficiency can be significantly improved with combined heat and power, in the current fossil system we are still chasing 10 billion annually through chimneys and cooling towers, or using it to heat up rivers.

In addition to environmental damage and costs, however, this inefficiency also creates a distorted picture of the German energy system. Of the 10,600 PJ (petajoules) of primary energy consumed, only about 8,100 PJ are ultimately used⁴. Renewable energies are consequently underrepresented in the primary energy consideration. Since they have practically no conversion loss to account for and no energy is consumed for fuel deliveries⁸, regenerative electricity sources such as solar and wind can replace three times the amount of primary energy.

Efficiency Gains Through Electrification

From this perspective, it is obvious that when alternatives exist, it makes no sense to stick with extremely inefficient technologies. An increase in efficiency would reduce total energy consumption, significantly simplify the achievement of climate targets, and require no compromises in the ultimate benefit (the energy service) for the consumer (or company).

A clear example of the efficiency advantages of new technologies is the heat pump. While conventional heating systems, such as gas or oil boilers, generate about one unit of heat from one unit of energy, modern heat pumps typically deliver four units of heat from one unit of electricity⁹. This high efficiency means that the same heating performance can be achieved with significantly less primary energy input than even with the most efficient condensing boilers.

Another area where the efficiency advantages of electrification become clear is electromobility. Electric motors convert about 80 percent of the supplied energy into motion. Taking additional losses into account, for example when charging the battery, electric cars achieve an overall efficiency of around 65 percent. In comparison, the efficiency of diesel engines is around 45 percent and that of gasoline engines under optimal conditions is 30–35 percent¹⁰. The low efficiency of the internal combustion engine was also overlooked in the data for mechanical energy in the transport sector in Figure 1. If one also considers the energy losses in fuel provision, i.e., the steps from the borehole to the vehicle tank, only around 20 percent of the energy originally used is actually utilized¹¹. As is evident in Figure 1, a large part of the energy used in transport is still obtained from fossil fuels; a conversion of the approximately 2,500 PJ sector to e-mobility would consequently drastically reduce sectoral energy requirements. A conversion of the sector to hydrogen or so-called e-fuels, moreover, does not represent a realistic alternative. As Wien Energie shows in a comparison of electric vehicles, hydrogen drives, and novel e-fuels, both hydrogen at 22 percent and e-fuels at 13 percent efficiency are far from the efficiency of modern e-vehicles¹². Hydrogen and e-fuel technologies have the opposite problem of conventional energies—they do not have to convert an energy source like oil or gas into electricity, but rather turn high-quality electricity into lower-quality but easily transportable liquid energy sources in energy-intensive conversion processes.

While e-cars and heat pumps—though not exclusively—bring efficiency mostly to the private sector, it is industry that is still largely dependent on conventional and thus inefficient energy in Germany⁴. Electrode boilers offer enormous potential for the industry to decarbonize process heat. Many industrial applications, such as in the chemical, food, or paper industries, require large amounts of heat at high temperatures—previously mostly covered by natural gas or other fossil fuels. Electrode boilers or piston compressor systems make it possible to provide this process heat efficiently and emission-free, provided they are operated with electricity from renewable sources. Electric boilers achieve almost 100 percent efficiency in converting electricity into heat and, thanks to their short reaction time, offer great flexibility for industrial processes with changing load requirements. With heat pumps, the efficiency improves significantly. Unlike classic boiler systems, fuel storage, emission protection measures, and long start-up times are eliminated. In addition, electric boilers can be used specifically to relieve grid bottlenecks by converting excess electricity into heat and using it on-site or storing it temporarily in heat storage units. The coupling of electricity and heat sectors is an important building block for the transformation of German industry, the benefits of which have hardly been taken into account in the conventional primary energy balance so far¹³. But even without electricity, heat can be produced very efficiently with environmental heat, especially geothermal energy through direct use or through combination (i.e., with a heat pump). The drillings are, of course, a high initial investment, but they are also strongly supported by the BEW program¹⁴.

Electrification in Figures

It can be seen that in Germany, more than half of final energy consumption is accounted for by households and transport. Space heating and mechanical energy (mobility) are particularly striking as the largest items here.

The scientific paper by Oxford Professor Nick Eyre shows that a complete conversion of the global energy system could bring about a reduction in consumption of 40 percent—global annual consumption would fall from 416 EJ (exajoules) to 247 EJ.

Transport and buildings, where the aforementioned items of mechanical energy and space heating are located, account for more than half of the reduction in this projection. Heat pumps (possibly with geothermal energy) and e-mobility would be drivers of change due to their better efficiency. In industry, the percentage of electricity used would double, in the building sector it would almost triple, and in the transport sector it would be about 30 times as large as it is currently¹⁵. Through progressive electrification, the dependence on fossil fuels could thus be reduced and the overall energy system could be made significantly more efficient and, through decentralized generation, also more secure.

Conclusion

The widespread idea that a transition to renewable energies is not possible because their share of primary energy is low fails to recognize the fundamental inefficiency of conventional technologies. The focus on primary energy conveys a distorted picture of actual energy flows, as it ignores conversion losses and efficiency gains through new technologies. With the increasing use of heat pumps, geothermal energy, e-mobility, and electrified industrial processes such as electrode boilers, total energy consumption will be significantly reduced—without this being accompanied by a loss of comfort or performance. The primary energy indicator will inevitably fall, not because less energy is being “provided,” but because the same services can be provided with less input. The supposedly low share of renewables in primary energy must therefore not serve as an argument against the energy transition—rather, it shows how outdated and misleading conventional energy accounting is. A successful transformation of the energy system does not mean replacing 100 percent of today’s primary energy, but using a fraction of it much more wisely through electrification and efficiency.

From the Newsletter “E|News: Renewable Energy”

Sources:

¹ Electricity Generation 2024: 59.4% from Renewable Energy Sources – Federal Statistical Office

² Primary Energy Consumption | Federal Environment Agency

³ Have we been duped by the primary energy fallacy? | by Jan Rosenow | Medium

⁴ EFB_EBD23e_PJ_deu-1.pdf

⁵ Average Gross Efficiency of the Fossil Power Plant Fleet | Federal Environment Agency

⁶ Statistics questionnaires FAQ – IEA

⁷ Natural Gas and Crude Oil: Import Value until 2024 | Statista

⁸ 40% of global shipping is for transporting fossil fuels. | Jan Rosenow

⁹ The Heat Pump is Establishing Itself in Europe – Electricity Price as a Factor

¹⁰ Efficiency of Electric Cars | TÜV NORD Mobility

¹¹ BMUKN: Efficiency and Costs: Is Operating an Electric Car Worth It?

¹² Efficiency of Electric Car vs. Combustion Engine » Electricity, E-Fuels & Co.

¹³ Electrode Boilers: Buy Power-to-Heat Systems – Deutsche-Thermo.de

¹⁴ BMWE – Booster for Green District Heating: Federal Funding for Efficient Heating Networks (BEW) Starts

¹⁵ From using heat to using work: reconceptualising the zero carbon energy transition | Energy Efficiency