International Energy Agency: Electrification drives global electricity demand

The International Energy Agency (IEA) assumes that global demand for electricity will increase by just under two percent this year.

International Energy Agency: Electrification drives global electricity demand

The International Energy Agency (IEA) assumes that global demand for electricity will increase by just under two percent this year. The reasons for this are the ongoing economic slowdown and the effects of the energy crisis in many industrialized countries, said the IEA in Paris in its electricity market report.

Demand for electricity is expected to fall in the USA, Japan and Europe in 2023. Electricity consumption in the EU is expected to fall to levels last seen in 2002. Energy-intensive industries in the EU have not yet recovered from last year's slump in production, it said.

With improved prospects for the global economy, however, an increase in demand for electricity of 3.3 percent is expected again in the coming year. According to the IEA report, the increase in electricity demand is being driven by electrification in an effort to reduce climate-damaging emissions. In addition, due to rising temperatures, more air conditioning systems would be used, which would drive up electricity consumption. In addition, there would be robust growth in demand in the emerging and developing countries.

More electricity from renewable energies

Although demand is increasing in many regions, the heavy deployment of renewable energy around the world means that it is on track to meet all of the additional growth in global electricity demand over the next two years, the IEA analysis found. By 2024, renewable energies will account for more than a third of global electricity generation. Depending on the weather, 2024 could be the first year in which more electricity is generated from renewable sources than from coal worldwide.

At the same time, power generation from fossil fuels is expected to decline over the next two years, according to the IEA. Oil-based power generation is forecast to decline sharply, while coal-based power generation is set to decline slightly in 2023 and 2024 after rising 1.7 percent in 2022.

"World demand for electricity will increase sharply in the coming years," said IEA Director of Energy Markets and Security Keisuke Sadamori. The share of renewable energy in electricity generation is expected to increase, leading to a decrease in the use of fossil fuels. "Now is the time for policymakers and the private sector to build on this momentum to ensure emissions from the power sector fall sustainably."

Another sign that the energy transition is taking hold is that the IEA now expects fossil fuel power generation to decline in four of the six years between 2019 and 2024. This indicates that the world is rapidly moving towards a tipping point where global electricity generation from fossil fuels will increasingly be replaced by electricity from clean energy sources, the report said.

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