(Arête News) — Global carbon emissions are on track to decline by almost 8 percent this year from the COVID-19 pandemic causing the biggest downturn in energy use since World War II, the International Energy Agency said on Thursday.
That is based on a projected 6 percent drop in demand for energy use in 2020, seven times as much as what occurred after the global financial crisis triggered by the collapse of Lehman Brothers in 2008.
“In absolute terms, the decline is unprecedented — the equivalent of losing the entire energy demand of India, the world’s third largest energy consumer,” IEA said in a statement. “Advanced economies are expected to see the biggest declines, with demand set to fall by 9 percent in the United States and by 11 percent in the European Union.”
Paris-based IEA, an intergovernmental organization among 30 industrialized nations formed in the wake of the 1973 oil crisis, said the world’s energy demand drops about 1.5 percent every month that institutions, businesses and schools remain closed from virus-related stay-at-home orders at levels seen in early April.
The drop in demand this year — the biggest energy shock in more than seven decades — would dwarf the impact of the global financial crisis, according to IEA’s Global Energy Review, based on an analysis of data from the past 100 days.
Electricity demand is expected to decline by 5 percent in 2020, the largest drop since the 1930s Great Depression, also sparked by a Wall Street crash in 1929.
Due to the slower economy, the rate of growth in global CO2 emissions fell by about half in 2008, down to 1.7 percent from 2017’s 3.3 percent. Carbon emissions dropped by 1.3 percent, down to 8.6 billion tons, in 2009. But they rebounded to reach an all-time high of 9.1 billion tons in 2010.
IEA said its 2020 projections for energy demand and energy-related emissions of CO2, methane and other major heat-trapping industrial gases assume the world’s coronavirus lockdowns will gradually ease in most countries in the next several months, accompanied by a gradual economic recovery.
“This is a historic shock to the entire energy world. Amid today’s unparalleled health and economic crises, the plunge in demand for nearly all major fuels is staggering, especially for coal, oil and gas,” said IEA’s Executive Director Fatih Birol, a Turkish economist and energy expert.
“Only renewables are holding up during the previously unheard-of slump in electricity use,” he said. “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.”
The #Covid19 pandemic is the biggest shock to the global energy system in over 70 years.
— Fatih Birol (@IEABirol) April 30, 2020
A rise in renewables
The pandemic — infecting more than 3 million people and killing 217,000 so far — is a hit to fossil fuels, benefiting the environment. Demand for coal and coal-fired power generation is projected to drop by 8 percent and 10 percent, respectively, this year. Natural gas demand is expected to decline by 5 percent in 2020, the largest such drop in a half-century.
In contrast, renewable energy sources like solar photovoltaics and wind power, along with higher output from hydropower, are set to expand renewable electricity generation by 5 percent this year. Birol attributed that to a growing reliance on “reliable electricity supplies” to support basic needs. But nuclear power, also a source of low-carbon electricity, is projected to decline by 3 percent this year.
Global demand for biofuels also is set to decrease substantially in 2020, IEA said, as virus-mandated restrictions on transport and travel reduce road transport fuel demand, including for blended fuels.
The decline in global energy-related CO2 emissions would be the largest such decrease ever recorded — almost six times bigger than the 400 million ton decrease in 2009.
“Resulting from premature deaths and economic trauma around the world, the historic decline in global emissions is absolutely nothing to cheer,” said Birol. “And if the aftermath of the 2008 financial crisis is anything to go by, we are likely to soon see a sharp rebound in emissions as economic conditions improve.”
But he said governments can learn from that experience by putting clean energy technologies at the heart of their economic stimulus and recovery plans. Earlier this month, the International Renewable Energy Agency’s inaugural annual Global Renewables Outlook came to the same conclusion.
It said that nations could fully decarbonize by mid-century, in ways that revitalize their economies hit hard by the pandemic, if governments use their COVID-19 stimulus packages to promote clean energy technologies.
That would help nations meet 2015 Paris Agreement climate targets, said IRENA, and produce cumulative global GDP gains of US$98 trillion above the usual scenarios by 2050.