The COVID-19 pandemic has massively disrupted the global economy, forcing large parts of the world into confinement and creating the largest shock to the global energy system in more than seven decades.
Last week, the International Energy Agency (IEA) published the most detailed and up-to-date look at the pandemic’s impact on all major fuels and carbon emissions, based on more than 100 days of real-time data. The IEA’s new Global Energy Review found that the drop in energy demand this year is set to be seven times the decline after the 2008 financial crisis and lead to a record fall in carbon emissions of almost 8%, taking them to their lowest level in a decade.
With travel, trade and mobility restricted by various lockdown measures, demand for fossil fuels is falling across the board for coal, oil and natural gas. At the same time, we’re seeing a major shift towards low-carbon sources of electricity including wind, solar PV, hydropower and nuclear. Low-carbon technologies are now set to extend their lead as the largest source of global electricity generation, reaching 40% of the power mix in 2020.
“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,” says 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.”
The Global Energy Review’s projections of energy demand and energy-related emissions for 2020 are based on assumptions that the lockdowns implemented around the world in response to the pandemic are progressively eased in most countries in the coming months, accompanied by a gradual economic recovery.