Energy demand across the world in 2018 grew by 2.3 percent the fastest in a decade on the back of a global economy that grew by 3.7 percent in 2018.  China, the United States, and India accounted for nearly 70 percent of the rise.

In its latest findings, the International Energy Agency (IEA) said that the global electricity demand grew by 4 percent in 2018 to more than 23,000 TWh. This rapid growth has pushed the share of electricity in total final consumption of energy to 20 percent. Increasing power generation was responsible for half of the growth in primary energy demand.

Renewables accounted for nearly half of the electricity demand growth. China led the growth in renewables, both for wind and solar, followed by Europe and the United States.

Recently, Mercom reported that India was the third largest solar market behind China and the United States with 8.3 GW of solar PV capacity installed in 2018. Japan and Germany were the fourth and fifth largest solar markets in the world.

Global Energy Demand

The growth in energy demand was mostly perpetuated by a robust global economy and stronger heating and cooling requirements in some regions. India’s primary energy demand increased 4 percent or over 35 Millions of tons of oil equivalent (Mtoe), making up for 11 percent of global growth, the third largest share.

However, the demand for coal witnessed a rise as other fuels were not able to meet the higher electricity demand. Fossil fuels met nearly 70 percent of the growth in electricity demand for the second year running. In comparison, solar grew by 31 percent.

The rise in the use of fossil fuel for electricity demand has resulted in an increase in carbon emissions by 1.7 percent to 33 Gigatons (Gt) in 2018. Coal use in power generation also surpassed 10 Gt, most of which came from a young fleet of coal power projects in developing Asia.

“We have seen an extraordinary increase in global energy demand in 2018, growing at its fastest pace this decade. 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, utilization and storage”, said Fatih Birol, Executive Director of IEA.

Emissions

Global energy-related CO2 emissions rose 1.7 percent to a historic high of 33.1 Gt CO2, a result of higher energy demand. It was the highest rate of growth since 2013, and 70 percent higher than the average increase since 2010. China, India, and the United States accounted for 85 percent of the net increase in emissions, while emissions declined for Germany, Japan, Mexico, France, and the United Kingdom.

Energy efficiency was the largest decelerator on emissions growth in 2018, but its impact was about 40 percent lesser than in 2017, primarily due to the slack in implementing energy efficiency policies.

India witnessed emissions rise by 4.8 percent, or 105 Mt. Despite this growth, per capita emissions in India remain low at only 40 percent of the global average.

Renewables

Renewables grew by 4 percent and met about 25 percent of the growth in total primary energy demand. The growth was mainly due to the increase in electricity generation to which renewables contributed 45 percent in 2018. Renewables now account for over one-fourth of global power output. Solar PV, hydropower, and wind each contributed for about a third of the growth, with bioenergy accounting for most of the rest.

China accounted for over 40 percent of the growth in renewable-based electricity generation, followed by Europe, with 25 percent. The United States and India together contributed another 13 percent.

Energy efficiency

Energy efficiency continued to improve in 2018 worldwide. The annual rate of improvement in global primary energy intensity has been falling in recent years, dropping from a high of nearly 3 percent in 2015 to 1.9 percent in 2017, and falling again in 2018 to 1.3 percent. But the rate of improvement was much lower than what is seen in recent years. 2018 was the third consecutive year in which the improvement rate for energy efficiency slowed.

The slowdown in the rate of energy efficiency improvement means that efficiency offset 40 percent less CO2 emissions in 2018 relative to 2017, though energy efficiency remains the largest contributor to the reduction of emissions.

Limited improvement in global energy efficiency in 2018 can be blamed on lack of action in energy efficiency policy environment in 2018, with lackluster progress in implementing new energy efficiency policies or increasing the stringency of existing policies.

Europe and India both saw an increase in the rate of improvement for energy efficiency in 2018 relative to 2017.

Last year, IEA reported that investments into India’s renewable energy sector surpassed the investments made in the conventional energy (fossil-fuel based) projects in 2017.