Energy demand worldwide grew by 2.3 per cent last year, its fastest pace this decade, driven by a robust global economy and stronger heating and cooling needs in some regions, according to the International Energy Agency (IEA).
Natural gas emerged as the fuel of choice, posting the biggest gains and accounting for 45 per cent of the rise in energy consumption. Gas demand growth was especially strong in the United States and China.
Demand for all fuels increased, with fossil fuels meeting nearly 70 per cent of the growth for the second year running. Solar and wind generation grew at double-digit pace, with solar alone increasing by 31 per cent. Still, that was not fast enough to meet higher electricity demand around the world that also drove up coal use.
As a result, global energy-related CO2 emissions rose by 1.7 per cent to 33 Gigatonnes (Gt) in 2018. Coal use in power generation alone surpassed 10 Gt, accounting for a third of the total increase. Most of that came from a young fleet of coal power plants in developing Asia. The majority of coal-fired generation capacity today is found in Asia, with 12-year-old plants on average, decades short of average lifetimes of around 50 years.
These findings are part of the International Energy Agency’s latest assessment of global energy consumption and energy-related CO2 emissions for 2018. The Global Energy & CO2 Status Report provides a high-level and up-to-date view of energy markets, including latest available data for oil, natural gas, coal, wind, solar, nuclear power, electricity, and energy efficiency.
Electricity continues to position itself as the “fuel” of the future, with global electricity demand growing by 4 per cent in 2018 to more than 23 000 TWh. This rapid growth is pushing electricity towards a 20 per cent share in total final consumption of energy. Increasing power generation was responsible for half of the growth in primary energy demand.
Renewables were a major contributor to this power generation expansion, accounting for nearly half of electricity demand growth. China remains the leader in renewables, both for wind and solar, followed by Europe and the United States.
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Energy intensity improved by 1.3 per cent last year, just half the rate of the period between 2014-2016. This third consecutive year of slowdown was the result of weaker energy efficiency policy implementation and strong demand growth in more energy intensive economies.
“We have seen an extraordinary increase in global energy demand in 2018, growing at its fastest pace this decade,” IEA executive director Dr Fatih Birol said.
“Last year can also be considered another golden year for gas, which accounted for almost half the growth in global energy demand. But despite major growth in renewables, global emissions are still rising, demonstrating once again that more urgent action is needed on all fronts — developing all clean energy solutions, curbing emissions, improving efficiency, and spurring investments and innovation, including in carbon capture, utilisation and storage.”
Almost a fifth of the increase in global energy demand came from higher demand for heating and cooling as average winter and summer temperatures in some regions approached or exceeded historical records. Cold snaps drove demand for heating and, more significantly, hotter summer temperatures pushed up demand for cooling.
Together, China, the United States, and India accounted for nearly 70 per cent of the rise in energy demand around the world. The United States saw the largest increase in oil and gas demand worldwide. Its gas consumption jumped 10 per cent from the previous year, the fastest increase since the beginning of IEA records in 1971. The annual increase in US demand last year was equivalent to the United Kingdom’s current gas consumption.
Global gas demand expanded at its fastest rate since 2010, with year-on-year growth of 4.6 per cent, the second consecutive year of strong growth, driven by higher demand and substitution from coal. Demand growth was led by the United States. Gas demand in China increased by almost 18 per cent.
Oil demand grew 1.3 per cent worldwide, with the United States again leading the global increase for the first time in 20 years thanks to a strong expansion in petrochemicals, rising industrial production and trucking services.
Global coal consumption rose 0.7 per cent, with increases seen only in Asia, particularly in China, India and a few countries in South and Southeast Asia.
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Nuclear also grew by 3.3 per cent in 2018, with global generation reaching pre-Fukushima levels, mainly as a result of new additions in China and the restart of four reactors in Japan. Worldwide, nuclear plants met 9 per cent of the increase in electricity demand.
Commenting on the IEA’s report, The Economist Intelligence Unit lead analyst Peter Kiernan said, “The growth in global CO2 emissions in 2018 continues from the year before, dashing hopes that the stagnation in emissions between 2014-16 reflected that a global peak had been reached.
“Rather, stronger global economic performance pushed energy consumption higher, exposing the challenge of decoupling emissions from GDP growth.
“Renewables deployment is still robust, accounting for nearly half the growth in electricity demand in 2018, but greater use of low carbon sources, and improvements in energy efficiency, are not happening quickly enough.
“As a result the goals of the Paris Agreement will become further out of reach unless there is a drastic change in emissions trends in the short term.”