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‘Sector coupling’ could help decarbonise at lower cost

Electrification and sector coupling will be important components of the energy transition, if taxation is adjusted to create a level playing field

The practice of ‘sector coupling’ could create new dynamics, cut costs and reduce carbon emissions across multiple economic sectors. Sector coupling involves moving away from the siloed use of a particular energy carrier for a particular economic sector—such as oil for transport or natural gas for heating—and replacing it with a system where each sector can each utilise a variety of carriers. This should increase the efficiency of the energy system, but this shift will occur only if energy taxation is overhauled. Standards agency DNV GL argues that sector coupling would allow heavy industry, transport, households and services to procure power at more favourable costs. It sees coupling as an

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