Demulsification technology for separation of oil-water (O/W) emulsions, especially those stabilized by surfactants, is urgently needed yet remains highly challenging due to their inherent stability characteristics. Electrocoalescence has emerged as a promising solution owing to its simplicity, efficacy, and versatility, yet hindered by substantial energy consumption (e.g., >50 kWh/m3) along with undesirable Faradic reactions. Herein, we propose an innovative electric demulsification technology that leverages conductive membrane microchannels to confine oil droplets from the oil-water emulsion for achieving high energy-efficient coalescence of oil droplets. The proposed system reduces the required voltage down to 12 V, 2 orders of magnitude lower than that of conventional electrocoalescence systems, while achieving a similar separation efficacy of 91.4 ± 3.0% at a low energy consumption (3 kWh/m3) and an ultrahigh permeability >3000 L/(m2·h·bar). In situ fluorescence microscopy combined with COMSOL simulations provided insight into the fundamental mechanistic steps of an electric demulsification process confined to membrane microchannels: (1) rapid electric-field redistribution of oil droplet surfactant molecules, (2) enhanced collision probability due to confined oil droplet concentration under dielectrophoretic forces, and (3) increased collision efficacy facilitated by the membrane pore structure. This strategy may revolutionize the next generation of demulsification and oil-water separation innovations.