Global Energy Review 2020 : IEA
- 01 May 2020
- 5 min read
Why in News
Recently, the International Energy Agency (IEA) has released a report namely, Global Energy Review:2020 which also includes the impact of the Covid-19 crisis on global energy demand and CO2 emissions.
- The imposition of lockdown in several countries has largely restricted transportation such as road and air travel. In turn, the drastic reduction in the global energy demands has been observed.
Global Energy Demands
- The countries in full lockdown are experiencing an average decline of 25% in energy demand per week, while in those with a partial lockdown, the fall in energy demand is about 18% per week.
- Global energy demand declined by 3.8% in the first quarter of 2020 compared to the first quarter of 2019.
- Further, it is expected that the impact of Covid‑19 on energy demand in 2020 would be more than seven times larger than the impact of the 2008 financial crisis on global energy demand.
- Considering the above scenario the global demand of various energy sources can be analysed as given below:
- Coal Demand:
- It has been declined by 8% compared with the first quarter of 2019.
- The reasons for such decline include, China – a coal-based economy – was the country hardest hit by Covid‑19 in the first quarter and cheap gas and continued growth in renewables elsewhere challenged coal.
- Oil Demand:
- It has declined by 5% in the first quarter, majorly due to curtailment in mobility and aviation, which account for nearly 60% of global oil demand.
- The report also estimates that the global demand for oil could further drop by 9% on average in 2020, which will return oil consumption to 2012 levels.
- Gas Demand:
- The impact of the pandemic on gas demand has been moderate, at around 2%, as gas-based economies were not strongly affected in the first quarter of 2020.
- Renewables Energy Resources Demand:
- It is the only source that has registered a growth in demand, driven by larger installed capacity.
- Further, the demand for renewables is expected to rise by 1% by 2020 because of low operating costs and preferential access for many power systems.
- Electricity Demand:
- It has been declined by 20% during periods of full lockdown in several countries.
- However, the residential demand is outweighed by reductions in commercial and industrial operations.
- Coal Demand:
Covid-19 and CO2 Emissions
- Overall, the emissions decline in 2020 could be 8% lower than in 2019, which would be the lowest level of emissions since 2010.
- It is also the largest level of emission reduction — six times larger than witnessed during the 2009 financial crisis, and twice as large as the combined total of all reductions witnessed since World War II.
- In the first quarter of 2020, the decline in CO2 emissions is more than the fall in global energy demand.
India’s Energy Demands
- India, which is one of the IEA association countries, has experienced a reduction in its energy demands by 30% as a result of the nation-wide lockdown.
- Moreover, in India, where economic growth and power production are slowing significantly, the demand for coal is expected to decline steeply.
- China and India are the largest and third-largest electricity users in the world respectively, and coal use is dominant in both these countries shaping the global demand for this fuel.
International Energy Agency
- The International Energy Agency (IEA) is an autonomous organisation which works to ensure reliable, affordable and clean energy.
- It was established in the wake of 1973 (set up in 1974) oil crisis after the OPEC cartel had shocked the world with a steep increase in oil prices.
- It is headquartered in Paris, France.
- World Enegry Outlook report is released by IEA annually.
- India became an associate member of the International Energy Agency in 2017.
- Mexico officially became the International Energy Agency’s 30th member country in February 2018, and its first member in Latin America.