IEA’s Predicts Peak Power Emissions in 2025

Global electricity markets are heating up according to an electrifying report from the International Energy Agency (IEA) with shocking new forecasts. Get plugged in because it’s a lot to unplug.

… okay, we’re done with the puns.

What happened: Yesterday, the International Energy Agency (IEA) released its Electricity Market Report 2023 looking at recent trends and forecasts for electricity supply, demand, and emissions into 2025.

Changes in global emissions of electricity generation, 2015-2025
megatonnes of carbon dioxide

The key takeaways:

• Last year saw electricity demand grow 2 percent, lower than the annual average of 2.4 percent from 2015 to 2019. This was largely due to high energy costs in Europe and the on-again-off-again relationship China has (had?) with Covid.
   
• Despite those barriers, the IEA sees electricity demand growing by an average of 3 percent every year into 2025, of which 70 percent is expected from China, India, and Southeast Asia.
   
• Electricity supply and demand are becoming increasingly dependent on weather due to increases in electrified heating and cooling in extreme weather events.

How does the IEA see that demand being met?

In short, from renewables and nuclear. By 2025, renewables will grow to 35 percent of the global electricity mix (up from 29 percent) while the supply of nuclear will grow another 4 percent by 2025.

• Natural gas and coal power are expected to have regional increases and decreases that sum up to a flat global trend.

The implications: The IEA forecasts that emissions from power generation—which reached an all-time high in 2022—will plateau through 2025 as low-carbon sources dominate new growth.

Big picture: Lowering emissions with increases in low-carbon energy is emphasized by the IEA to be a win for both us and the climate. But the report does emphasize that low-carbon power can’t just come from intermittent wind and solar, but the growth of nuclear and batteries too.