[ad_1]
After almost continuous growth in energy demand since the oil crisis in the early 1970s, energy demand will fall by five percent in 2020, in the most optimistic scenario of the new report from the International Energy Agency. (IEA), “World Energy Outlook 2020”.
“It has been a stormy year for the energy sector. The coronary pandemic has caused more disruption than any other event in recent times. It will leave scars that will last for many years, ”the IEA writes in the annual report, which arrived Tuesday morning.
– Great impact on the entire system.
The year has not turned out as the IEA intended in the fall of 2019. Last year, global energy demand growth was forecast of 12 percent from 2019 to 2030.
These forecasts were rejected this winter when the corona pandemic caused the closure of communities and an almost total cessation of international air traffic.
Demand for oil is expected to be eight percent lower than in 2019. This is a larger decline than demand for coal, which is expected to fall by seven percent. Investments in the energy sector are expected to fall 18 percent this year, based on the IEA standard scenario.
“The fall in investment is likely to have major consequences for energy markets in the coming years, as the economic recession also puts pressure on demand.” The crisis is causing strategic changes for companies and investors, as well as consumer behavior, ”writes the IEA.
The terms “crisis” and “shock” are used more than 300 times in the 450-page report.
“This has been a huge shock to the entire system,” the IEA wrote of the corona pandemic.
Energy growth as in the 1930s
Climate emissions caused by the energy sector are expected to fall by seven percent this year and be at the same level as ten years ago.
“The corona pandemic has created great uncertainty about the short-term energy outlook. We are entering a critical decade to accelerate the transition to clean energy and reverse climate emissions, ”writes the IEA.
The organization has created four main scenarios in which they try to look to the future. For the most optimistic scenario to succeed, the world economy must return to what it was before the corona pandemic over the next year.
If the world economy does not return to what it was before in 2023, this will lead to the lowest energy growth since the 1930s, with only four percent growth from 2019 to 2030.
Something that the executive director of the IEA has no doubts:
– The period of global growth in oil demand will end in the next decade, says Fatih Birol.
Greater market turmoil
There is still no vaccine for the Covid-19 coronavirus. So far in October, an average of more than 300,000 new coronavirus infections have been registered every day. Confirmed deaths are close to 1.1 million people.
“The uncertainty about the duration of the pandemic, the social and economic consequences and the political measures to be implemented open a wide range of different perspectives for the energy sector in the coming years,” writes the IEA.
Demand for coal will continue to decline. In 2040, coal will account for 20 percent of energy production, for the first time since the industrial revolution began, in the standard scenario. Natural gas will continue to grow significantly, mainly in Asia.
“The slower pace of growth in energy demand is putting pressure on oil and gas prices compared to the pre-crisis outlook. With large declines in investment in 2020, the potential for future turmoil in 2020 increases. the market, ”writes the IEA.
The new king of the energy market
Unlike in the past, the 2020 report tries to look more to the future. The reason is the prevailing uncertainty about how long the corona pandemic will affect energy demand and how this can lead to a more rapid shift towards renewables.
Solar power is expected to grow in all the scenarios presented by the IEA, well supported by a green policy, advanced technology and access to cheap capital.
– I believe that solar energy will be the new king of the world electricity market, says Fatih Birol, director of the International Energy Agency IEA, in relation to the presentation of the report.
International financial markets also have an important role to play.
“The financial sector must facilitate the rapid expansion of renewable technologies, help traditional energy companies with the transition and ensure that cheap capital is available in the countries and societies that need it most,” writes the IEA.
Behavior changes
Several countries – and companies – have set ambitious zero-emission targets for 2050. For the first time, the IEA includes a detailed blueprint of what must be done in the next ten years to achieve zero emissions in 30 years.
It is essential that people are willing to change their behavior. The IEA comes up with 11 concrete proposals showing how much global emissions can be reduced, including lowering the ambient temperature by three degrees in cold regions and adjusting air conditioning three degrees to the right.
“The decision to buy an electric car, insulate the home, cook with natural gas can be governed by regulations and laws and is influenced by the market. In many cases, it is ultimately a matter of personal choice, ”writes the IEA.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases via a link, which leads directly to our pages. Copying or other use of all or part of the content may only be done with written permission or as permitted by law. For more terms, see here.
