Renewable sources of electricity are set to be the only energy source that will grow in 2020 amid falling power demand stemming from the global coronavirus pandemic, according to a new report from the International Energy Agency (IEA).
After overtaking coal for the first time ever in 2019, renewables and low-carbon sources of electricity are set to extend their lead this year to reach 40% of global electricity generation.
Wind, solar and other forms of renewables are projected to increase their share against a backdrop of “plunging” global energy demand as a result of the “biggest shock since the Second World War”.
Despite supply chain disruptions that have paused or delayed deployment in several key regions this year, photovoltaics and wind are on track to help lift renewable electricity generation by 5% in 2020, aided by higher output from hydropower, IEA’s Global Energy Review 2020 found.
IEA executive director Fatih Birol said: “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.
“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.”
The increase in electricity generation from wind and solar in 2020 is due in part to new projects that were completed in 2019 and early 2020. Priority access to grids and low operating costs were also cited as factors behind the rise in renewables’ share in the study.
“This crisis has underlined the deep reliance of modern societies on reliable electricity supplies for supporting healthcare systems, businesses and the basic amenities of daily life,” said Birol.
“But nobody should take any of this for granted – greater investments and smarter policies are needed to keep electricity supplies secure,” Birol added.
Despite the resilience of renewables in electricity generation in 2020, their growth is set to be lower than in previous years, highlighted the report, while nuclear power is expected to drop by 3% this year from the “all-time high” it reached in 2019.
The study also found renewables outside the power sector are faring “less well”, with global demand for biofuels set to fall substantially in 2020 as restrictions on transport and travel reduce road transport fuel demand, including for blended fuels.
COVID-19 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%, IEA’s report found.
The study provides an “almost real-time view” of the pandemic’s “extraordinary impact” across all major fuels, based on an analysis of more than 100 days of real data so far this year.
The report projects that energy demand will fall 6% in 2020 – seven times the decline after the 2008 global financial crisis, equivalent to losing the entire energy demand of India, the world’s third largest energy consumer.
Advanced economies are expected to see the biggest declines, with demand set to fall by 9% in the United States and by 11% in the EU.
Changes to electricity use during lockdowns have resulted in significant declines in overall electricity demand, with consumption levels and patterns on weekdays looking like those of a pre-crisis Sunday.
Full lockdowns have pushed down electricity demand by 20% or more, with lesser impacts from partial lockdowns. Electricity demand is set to decline by 5% in 2020, the largest drop since the Great Depression in the 1930s.
The resulting 8% drop in carbon dioxide emissions projected for 2020 would be the largest decrease in emissions ever recorded, the report highlighted.
Birol added: “Resulting from premature deaths and economic trauma around the world, the historic decline in global emissions is absolutely nothing to cheer.
“And if the aftermath of the 2008 financial crisis is anything to go by, we are likely to soon see a sharp rebound in emissions as economic conditions improve. But governments can learn from that experience by putting clean energy technologies – renewables, efficiency, batteries, hydrogen and carbon capture – at the heart of their plans for economic recovery. Investing in those areas can create jobs, make economies more competitive and steer the world towards a more resilient and cleaner energy future.”