Global electricity demand is growing faster than renewables growth, driving a strong increase in generation from fossil fuels, according to a new International Energy Agency (IEA) report.
After falling by about 1% in 2020 due to the impacts of the Covid-19 pandemic, global electricity demand is set to grow by close to 5% in 2021 and 4% in 2022 – driven by the global economic recovery – the latest edition of the IEA’s semi-annual Electricity Market Report highlighted.
The majority of the increase in electricity demand is expected to come from the Asia Pacific region, primarily China and India.
Based on current policy settings and economic trends, electricity generation from renewables – including hydropower, wind and solar PV – is on track to grow strongly around the world over the next two years – by 8% in 2021 and by more than 6% in 2022, said the report.
Even with this “strong growth”, renewables will only be able to meet around half the projected increase in global electricity demand over those two years, said the IEA report.
Fossil fuel-based electricity generation is set to cover 45% of additional demand in 2021 and 40% in 2022, with nuclear power accounting for the rest.
As a result, carbon emissions from the electricity sector, which fell in both 2019 and 2020, are forecast to increase by 3.5% in 2021 and by 2.5% in 2022, which would take them to an all-time high.
Renewable growth has exceeded demand growth in only two years, in 2019 and 2020, largely due to “exceptionally slow or declining demand”, suggesting that renewables outpacing the rest of the electricity sector is “not yet the new normal”.
IEA energy markets and security director Keisuke Sadamori said: “Renewable power is growing impressively in many parts of the world, but it still isn’t where it needs to be to put us on a path to reaching net-zero emissions by mid-century.
“As economies rebound, we’ve seen a surge in electricity generation from fossil fuels. To shift to a sustainable trajectory, we need to massively step up investment in clean energy technologies – especially renewables and energy efficiency.”