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Global Energy Review 2020: the impacts of the COVID-19 crisis on energy demand

Source: google.maps

The Global Energy Review 2020 by the International Energy Agency (IEA) analyses the impact of the Covid-19 pandemic on global energy demand and emissions, describing it as “the biggest shock since the Second World War”.  According to the released report, overall energy demand will decline 6% in 2020, while global carbon dioxide emissions are projected to fall by about 8%, compared with 2019.

In the first quarter of 2020, compared with the same period in 2019, global energy demand fell 3.8%. Among the major energy sources, the coal industry has been the most severely affected by the drop, by nearly 8%. Global oil demand has seen a decrease of about 5%, while demand for natural gas has fallen by around 2% in the first quarter of 2020. Renewable energy was identified as the energy source most resistant to the pandemic crisis. In Q1 2020, the worldwide use of renewables in all sectors increased by 1.5%, in comparison to Q1 2019. The IEA estimates that the total global use of renewable energy in 2020 will rise by about 1%.

The crisis has reduced electricity demand considerably, by 2.5% in Q1 2020, and the IEA predicts that over the whole year demand will go down by 5%, and in some regions reductions of even 10% are expected. As a consequence, power produced from nuclear and fossil fuels has also declined in Q1 2020, falling by 3%. Only renewables have escaped the fall in demand in electricity use during lockdown measures. Electricity generation from renewables has grown by about 3%, mainly due to new wind and solar PV projects completed in 2019 and because renewables, as a rule, get a priority dispatch over other sources of electricity. In general, the share of renewables in electricity supply in Q1 2020 reached 28% (26% in Q1 2019). Outside the power sector, the situation with renewables is slightly different, for example, the use of biofuels has declined as a result of general restrictions on transport and travel.

The IEA report found that the worldwide lockdown at the levels recorded in April reduces annual global energy demand by about 1.5% monthly. How the pandemic will continue to affect the energy industries is highly dependent on the duration and form of restrictions in the context of the COVID-19 crisis, the experts believe. “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”, noted Fatih Birol, the IEA Executive Director.