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Platform for Industrial Electrification

Electrification is one of the key trends shaping the global energy transition. The pace of this trend is set to accelerate due to recent geopolitical developments, favorable economics, and the demand for decarbonization.

Surging demand creates opportunities along the electrification value chain for industrial companies and power businesses—from integrators to raw-material suppliers—but also requires timely action and investment.

McKinsey’s Platform for Industrial Electrification enables organizations to unlock emerging opportunities and boost supply chain resilience against excess demands.

We help organizations across advanced industries such as equipment and component manufacturers, as well as global energy organizations, basic material producers, and private equity groups identify growth areas, find new investment opportunities, perform strategy reviews, build green businesses, map evolving customer needs, and mitigate supply chain risk.

Our experts leverage proprietary tools and data alongside detailed fundamental market models to capture global benchmarks and develop customized solutions for our clients.

>$4

trillion

cumulative revenue potential identified across electrification segments between 2021 to 2030

>$85

billion

profit pool identified across electrification systems by 2030

80+

components

covered in value pool assessments across electrification assets

What We Do

Adjacent growth opportunity identification

Conducting business opportunity scans related to horizontal and vertical integrations to capture the full potential of value creation for existing market participants in the electrification space

Investment opportunity scanning

Scanning investment themes across the electrification ecosystem covering technologies across the power, industry, building, and mobility sectors—from assets and components to associated critical raw materials—as well as identifying potential M&A targets

Strategy review

Assessing and stress-testing corporate and business unit strategies by evaluating dynamics in core and adjacent businesses, which includes the evolution of existing business segments under various energy transition scenarios as well as performing strategy optimization efforts to capture critical control points necessary to secure a favorable competitive position

Green business building

Helping clients unlock and operationalize new growth opportunities by building new green businesses, from defining technology and go-to-market approaches, to developing a concrete business case to articulating the value proposition, to identifying short-term sales and partnership opportunities, and supporting customer approaches

Customer evolution assessment

Assessing new and evolving customer segments emerging from the electrification trend, covering future demand for products and materials, and identifying potential new offtakes and partners

Supply chain risk mitigation

Identifying areas of risk along the supply chain by assessing potential bottlenecks emerging from an electrification-driven demand, as well as developing mitigation measures to foster resilience and securing future supply

Impact Stories

Identifying green growth opportunities for a leading industrial company

A leading industrial company sought new growth opportunities across the electrification landscape, and we collaborated with the organization to identify more than 20 strategic growth opportunities with a focus on electrification. This enabled us to identify the potential for $4 billion to $7 billion in revenue increase by 2030 and outlined a clear pathway for implementing two major growth opportunities.

Reviewing market and management plan

A leading global OEM in the energy sector wanted an external perspective to stress test its market assumptions and create a strategic plan focused on components in e-mobility, renewables, and energy markets. We identified value-creation opportunities, resulting in additional revenue potential of more than $2.5 billion and profit potential of more than $300 million by 2030.

Building a green business in electrification-fueled technology

A global OEM aiming to become a leader in the industrial heat pump market needed support to build a new business segment from the ground up. We helped define a detailed business plan and attainable ambition level the organization could implement. We then delivered a plan with more than $1 billion of revenue potential and enabled the organization to drive business building through capability building and implementation setup.

Reviewing core and adjacent business strategy

A leading OEM in the energy sector was aiming to strengthen its position as a key leader in the grid-infrastructure segment with an ambitious strategy target of close to doubling its current revenue within five years. We quantified the organization’s present and future value potential across sectors, created transparency in financials, and benchmarked it against peers to access key value drivers. As a result, we identified unexplored profit pockets and key value drivers with more than a 20 percent margin through in-depth analysis of historical and forecasted financial data.

Providing a perspective on customer megatrends in an evolving commodity market

A major European commodity producer wanted to understand future customers and their commodity demand to identify new segments being driven by major trends such as decarbonization and electrification. We conducted multiple workshops focused on different electrification demand segments and offered insights on high-potential customer sectors. This resulted in €75 million EBITDA impact with detailed business case added to company-wide transformation plan, a green business build plan being fleshed out to capture a radical new idea, and a new operating model blueprint in line with new market priorities being implemented.

Featured capabilities

Industrial electrification model suite

Our solution is a set of bottom-up models that are customizable, scenario-based, interconnected, and granular, providing insights across the whole electrification value chain until 2050 on a country-level.

We provide insights from applications to components and materials for a wide range of electrification-enabling technologies across sectors—from electrolysers to electrify the process industry, to heat pumps to decarbonize buildings, and EVs and respective charging infrastructure to electrify the mobility sector, and finally wind, solar, energy storage to unlock electrification in the power industry.

This comprehensive set of models quantifies capital expenditures (OEM sales for manufacturers) and EBIT (OEM profit for manufacturers) value pools providing insights on market dynamics, pockets of growth, as well as technology trends and supplier landscapes.

As the solution manager of the Platform for Industrial Electrification, I ensure that we constantly expand our distinctive models and insights as well as convene the best experts to answer our client’s most urgent questions on the emerging electrification trend.

Friederike Liebach, Platform for Industrial Electrification manager

As the leader of the Platform for Industrial Electrification, I aspire to serve global industrial leaders and technology disruptors to optimize their portfolio, identify green business building opportunities and build more resilient supply chains so that they can fully capture the benefits of electrification and contribute to secure the net zero transition.

Luigi Gigliotti, Platform for Industrial Electrification leader

Global leaders

Christer Tryggestad
Senior Partner, Oslo
A leader of our global Electric Power and Natural Gas (EPNG) and Oil and Gas (O&G) Practices; also leads the Knowledge Committee of the Global EPNG Practice and McKinsey’s Scandinavian energy sector
Harald Bauer
Senior Partner, EMEA, Frankfurt
Advises semiconductor and high-tech clients on matters of strategy, operations, and performance transformation
Bram Smeets
Partner, Amsterdam
Advises leaders in the private and public sectors as they navigate rapid shifts in the energy landscape, supporting efforts to establish a more sustainable energy future
Raffael Winter
Partner, Düsseldorf
Supports energy clients in mature and emerging utility markets on growth, portfolio strategy, transactions, and other strategic and corporate-finance issues
Christian Jansen
Partner, Hamburg
Works with leading high tech, industrial, and automotive companies on defining winning strategies in the face of technology disruption, shaping their digital transformation, and building new businesses
Tamara Gruenewald
Sr. Solution Leader & Associate Partner, Zurich
Helps clients navigate the opportunities and challenges resulting from energy transitions with a focus on scenario thinking and value pools across the energy value chain

Featured insights

Article

Building resilient supply chains for the European energy transition
– To ensure a timely and orderly energy transition, companies and other stakeholders urgently need to strengthen each step of the already-stretched supply chains of key technologies.
Article

Unlocking opportunities from industrial electrification
– Electrification brings major value creation opportunities for industrial companies across the value chain—from integrators to raw-material suppliers—but also requires timely actions and investments.
Article

How to succeed in the expanding global offshore wind market
– Regions around the world are embracing offshore wind. Companies that pursue projects can expect numerous challenges and must excel across multiple domains.
Article

Unlocking the growth opportunity in battery manufacturing equipment
– Surging demand for battery cells gives rise to an opportunity for European machinery and equipment manufacturers to supply emerging gigafactories.
Article

Capturing the battery value-chain opportunity
– Companies and governments must move quickly to gain a foothold in the fast-growing battery market for electric vehicles.
Article

Building the electric-vehicle charging infrastructure America needs
– The United States needs many more EV-charging stations—and federal funds for them are coming. Seven principles could help US states and companies accelerate this buildout effectively.
Article

The raw-materials challenge: How the metals and mining sector will be at the core of enabling the energy transition
– As the world gears up for net zero, demand for raw materials is set to soar. The energy transition presents unique challenges for metals and mining companies, which will need to innovate and rebuild their growth agenda.
Article

Lithium mining: How new production technologies could fuel the global EV revolution
– Lithium is the driving force behind electric vehicles, but will supply keep pace with demand? New technologies and sources of supply can fill the gap.
Article

The semiconductor decade: A trillion-dollar industry
– The global semiconductor industry is poised for a decade of growth and is projected to become a trillion-dollar industry by 2030.
Article

Semiconductor shortage: How the automotive industry can succeed
– As the semiconductor shortage persists, the automotive industry will likely benefit from new sourcing models and stronger bonds between OEMs, Tier 1 suppliers, and semiconductor suppliers.
Article

Strategies to lead in the semiconductor world
– Semiconductor companies can take different paths to capture new opportunities as demand continues to outstrip supply.

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