The U.S. Energy Information Administration’s (EIA) latest International Energy Outlook 2021 report suggests that if current policy and technology trends continue, global energy consumption and energy-related carbon dioxide emissions will increase through 2050 due to population and economic growth.
The report finds that renewables will be the primary source for new electricity generation in 2050. However, natural gas, coal, and batteries will meet load and support grid reliability. Oil and natural gas production will continue to grow, mainly to support increasing energy consumption in developing Asian economies.
According to the report, liquid fuels will remain the most significant energy source in 2050, but renewable energy use will grow to nearly the same level. The report suggests that by 2050, global energy use will increase almost 50% compared with 2020. This increase is attributed to the economic growth and population of non-organization for economic co-operation and development (OECD) nations.
After a period of decline in coal consumption through 2030, consumption of all primary fuels grows from 2030 to 2050. Renewable energy consumption more than doubles between 2020 and 2050. Renewable energy consumption will equal liquid fuels consumption by 2050. The rise of renewables, which will account for 27% of global energy consumption in 2050, is driven by falling technology costs and changing government policies.
The reports find that incremental electricity generation comes mainly from renewable resources, beginning in 2025. As renewable, particularly solar and wind, become cost‐competitive, post‐2020 electricity generation growth in OECD regions will come from renewable sources. Renewables will displace an increasing share of existing non‐renewable, mostly fossil fuel‐based, sources.
In non‐OECD regions, the report projects that electricity generation from renewable sources will account for about 90% of generation increase from 2020 to 2050. Because electricity generation will
grow at almost twice the rate in non‐OECD regions than in OECD regions, the non‐OECD regions will add over two times the generation from renewable sources compared with the OECD regions.
Although renewables have become cost‐competitive with new fossil fuel generation, in OECD regions where electricity demand growth is slower than in the non-OECD areas, renewable generation will have less opportunity to grow without policies to encourage it. Policy incentives in OECD Europe in the form of a carbon cap and trade system are designed to facilitate generation from new renewable sources and displace existing non‐renewable generation.
In 2050, coal‐fired and nuclear generation will decrease by almost one‐third relative to 2020 levels, and natural gas‐fired generation will stay relatively flat. The share of renewables in the OECD Europe region will increase from less than half of the generation mix in 2020 to almost three‐quarters by 2050. This increase will occur as the use of non‐renewable energy resources shifts from being the primary source of electricity toward serving as reliability support for the rising amounts of renewable energy.
The report, however, clarifies that this projected growth in renewables is uncertain and may largely depend on changes to regulatory policies and market rules, significant and cost‐effective supply chains to support renewable installations. The development is also dependant on enough conventional generation technologies or storage to back intermittent renewable capacity.
An earlier report from IEA found that solar energy will witness exponential growth and match coal’s share in the Indian power generation mix by 2040 or earlier. The share of coal is expected to decline from 44% in 2019 to 34% in 2040. The percentage of solar power in India’s installed power capacity mix reached 10.3%, exceeding that of wind-based power sources for the first time, according to Mercom’s data.