Global energy demand to fall 6pc in 2020, says IEA report
DUBAI, May 1, 2020
Overall global energy demand will fall 6 per cent in 2020 – seven times the decline after the 2008 global financial crisis, according to the International Energy Agency (IEA).
"The Covid-19 pandemic represents the biggest shock to the global energy system in more than seven decades, with the drop in demand this year set to dwarf the impact of the 2008 financial crisis and result in a record annual decline in carbon emissions of almost 8 percent," said an IEA press release issued on Thursday.
The demand for electricity is set to decline by 5 per cent, according to a new report ‘the IEA’s Global Energy Review’ that assesses the impact of the Covid-19 pandemic on the global energy system.
In absolute terms, the decline is unprecedented – the equivalent of losing the entire energy demand of India, the world’s third largest energy consumer, the report said.
Advanced economies are expected to see the biggest declines, with demand set to fall by 9 per cent in the US and by 11 per cent in the European Union.
The impact of the crisis on energy demand is heavily dependent on the duration and stringency of measures to curb the spread of the coronavirus. For instance, the IEA found that each month of worldwide lockdown at the levels seen in early April reduces annual global energy demand by about 1.5 percent.
"This is a historic shock to the entire energy world. Amid today’s unparalleled health and economic crises, the plunge in demand for nearly all major fuels is staggering, especially for coal, oil and gas. Only renewables are holding up during the previously unheard-of slump in electricity use," said Dr. Fatih Birol, the IEA Executive Director.
"It is still too early to determine the longer-term impacts, but the energy industry that emerges from this crisis will be significantly different from the one that came before," Birol said.
Changes to electricity use during lockdowns have resulted in significant declines in overall electricity demand, the report revealed.
At the same time, lockdown measures are driving a major shift towards low-carbon sources of electricity including wind, solar photovoltaic (PV), hydropower and nuclear.
After overtaking coal for the first time ever in 2019, low-carbon sources are set to extend their lead this year to reach 40 percent of global electricity generation – 6 percentage points ahead of coal, said the IEA report.
Electricity generation from wind and solar PV continues to increase in 2020, lifted by new projects that were completed in 2019 and early 2020, it added.-TradeArabia News Service
