Agency’s forecast suggests 2021 could prove to be peak year for power sector carbon emissions
Carbon emissions from the electricity sector are set to decline this year, as demand growth for electricity around the world slows and additions of renewable power generation edge fossil fuel generators off electricity grids around the world, according to the latest data from the International Energy Agency ( IEA).
The US body’s latest electricity market report notes that global additions of renewable power generation are set to rise by more than 10 per cent this year, while low carbon generation is set to rise by seven per cent, leading to a near one per cent drop total fossil fuel-based generation.
The projections suggest carbon emissions from the global electricity sector are set to decline in 2022 from the all-time high they reached in 2021 – albeit by just less than one per cent – fueling hopes that energy-related emissions may have peaked.
The report notes that global electricity demand is set to return to pre-pandemic levels in 2022, rising by around 2.4 per cent by 2022, in addition to the six per cent increase seen in 2021 as the global economy rebounded from a year of covid- induced lockdowns.
The IEA has attributed the slowdown in electricity demand this year to surging energy prices following Russia’s invasion of Ukraine, and a slowing of economic growth around the world.
Electricity prices have more than tripled in some markets around the world as fossil gas prices have soared in the wake of Russia’s invasion of Ukraine, the IEA said, noting that fossil gas prices in Europe were four times higher in the first half of 2022 compared to the same period a year prior, while coal prices are more than three times higher.
The report notes that coal use for power is set to increase slightly in 2022, as shrinking coal power generation in China is offset by European countries ramping up their use of the fossil fuel as they look to reduce their reliance on Russian gas imports.
In contrast, gas power demand is expected to fall by 2.6 per cent as declines in Europe and South America outweigh growth in North America and the Middle East.
Meanwhile, the renewable market continued to see deployments of new capacity surge all around the world, enabling grids to curb their reliance on more costly and carbon intensive fossil fuels and ensuring that overall energy related emissions are set to fall even as demand for energy ticked upwards .
Keisuke Sadamori, IEA director of energy markets and security, urged governments responding to energy market turmoil to remain focused on the clean energy transition, noting that it was the long-term solution that would reduce citizens exposure to high fossil fuel prices.
“The world is in the midst of the first truly global energy crisis, triggered by Russia’s invasion of Ukraine, and the electricity sector is one of the most heavily affected,” said Sadamori. “This is especially evident in Europe, which is experiencing severe energy market turmoil, and in emerging and developing exported, where supply disruptions and soaring fuel prices are putting huge strains on fragile power systems and resulting in blackouts.
“Governments are having to resort to emergency measures to tackle the immediate challenges, but they also need to focus on accelerating investment in clean energy transitions as the most effective lasting response to the current crisis.”