Update | IEA World energy outlook 2024


energy system is electric – and now it is visible to everyone,” said Dr Birol. “In energy history, we’ve witnessed the Age of Coal and the Age of Oil – and we’re now moving at speed into the Age of Electricity, which will define the global energy system going forward and increasingly be based on clean sources of electricity.”


“As with many other global energy trends today, China is a major part of what is happening,” Dr Birol added. “Whether it’s investment, fossil fuel demand, electricity consumption, deployment of renewables, the market for EVs, or clean technology manufacturing, we are now in a world where almost every energy story is essentially a China story. Just one example: China’s solar expansion is now proceeding at such a rate that, by the early 2030s – less than ten years from now – China’s solar power generation alone could exceed the total electricity demand of the United States today.” Global electricity demand growth is set to accelerate further in the years ahead, adding the equivalent of Japanese demand to global electricity use each year in a scenario based on today’s policy settings – and rising even more quickly in scenarios that meet national and global goals for achieving net zero emissions.


Rising data centre electricity use, linked in part to growing use of AI, is already having some strong local impacts, but the potential implications of AI for energy are broader and include improved systems co-ordination in the power sector and shorter innovation cycles.


There are more than 11 000 data centres registered worldwide and they are often spatially concentrated, so local effects on electricity markets can be substantial. However, at a global level, data centres account for a relatively small share of overall electricity demand growth to 2030. More frequent and intense heatwaves than assumed in the Stated Policies Scenario (STEPS), or higher performance standards applied to new appliances – notably air conditioners – both produce significantly greater variations in projected electricity demand than an upside case for data centres. The combination of rising incomes and increasing global temperatures generate more than 1 200 TWh of extra global demand for cooling by 2035 in the STEPS, an amount greater than the entire Middle East’s electricity use today.


For clean energy to continue growing at pace, much greater investment in new energy systems, especially in electricity grids and energy storage, are necessary, says the IEA report. Today, for every dollar spent on renewable power, 60 cents are spent on grids and storage, highlighting how essential supporting infrastructure is not keeping pace with clean energy transitions. Secure decarbonisation of the electricity sector requires investment in grids and storage to increase even more quickly than clean generation, and the investment ratio


to rebalance to 1:1. Many power systems are currently vulnerable to an increase in extreme weather events, putting a premium on efforts to bolster their resilience and digital security.


Despite growing momentum behind clean energy transitions, the world is still a long way from a trajectory aligned with its net zero goals. Decisions by governments, investors and consumers too often entrench the flaws in today’s energy system, rather than pushing it towards a cleaner and safer path, the report finds. Reflecting the uncertainties in the current energy world, World energy outlook 2024 includes sensitivity analysis for the speed at which renewables and electric mobility might grow, how fast demand for LNG might rise, and how heatwaves, efficiency policies and the rise of artificial intelligence might affect electricity demand going forward. Based on today’s policy settings, global carbon dioxide emissions are set to peak imminently, but the absence of a sharp decline after that means the world is on course for a rise of 2.4°C in global average temperatures by the end of the century, well above the Paris Agreement goal of limiting global warming to 1.5°C. The report underlines the inextricable links between risks of energy security and climate change. In many areas of the world, extreme weather events, intensified by decades of high emissions, are already posing profound challenges for the secure and reliable operation of energy systems, including increasingly severe heatwaves, droughts, floods and storms.


A new energy system needs to be built to


last, World energy outlook 2024 emphasises, one that prioritises security, resilience and flexibility, and ensures that benefits of the new energy economy are shared and inclusive. In some regions of the world, high financing costs and project risks are limiting the spread of cost-competitive clean energy technologies to where they are needed most. This is especially the case in developing economies where these technologies can deliver the biggest returns for sustainable development and emissions reductions. Lack of access to energy remains the most fundamental inequity in today’s energy system, with 750 million people – predominantly in sub-Saharan Africa – without access to electricity and over 2 billion without clean cooking fuels.


To address the evolving energy challenges faced by countries around the world, the IEA is convening an International Summit on the Future of Energy Security in the second quarter of 2025. Hosted by the UK government in London, the Summit will assess the existing and emerging risks facing the global energy system, focusing on solutions and opportunities. And to explore the implications of AI for the energy sector, the IEA hosted a Global Conference on Energy & AI at its headquarters in Paris on 4 and 5 December.


12 | November/December 2024| www.modernpowersystems.com Where do we go from here?


The potential for near-term disruption to oil and gas supply is high due to conflict in the Middle East. Around 20% of today’s global oil and liquefied natural gas (LNG) supplies flow through the Strait of Hormuz, a maritime chokepoint in the region. However, while geopolitical risks remain elevated, an easing in underlying market balances and prices is on the horizon as slowing oil demand growth in the STEPS (Stated Policies Scenario) sees spare crude oil production capacity rise to 8 million barrels per day by 2030. A wave of new LNG projects is set to add almost 50% to available export capacity by 2030.


In all scenarios, growth in global energy demand slows thanks to efficiency gains, electrification and a rapid buildout of renewables. In the STEPS by 2030, nearly every other car sold in the world is electric, although delays in the roll-out of charging infrastructure or in policy implementation could lead to slower growth.


Clean energy meets virtually all growth in energy demand in aggregate in the STEPS between 2023 and 2035, leading to an overall peak in demand for all three fossil fuels before 2030, although trends vary widely across countries at different stages of economic and energy development.


Electricity demand grows much faster than overall energy demand, thanks to existing uses, notably cooling, and new ones such as electric mobility and data centres. Renewables lead the expansion in electricity generation, with sufficient speed to meet in aggregate all the increases in demand. There is scope to go even faster: today’s solar manufacturing capacity hovers around 1 100 GW per year, potentially allowing deployment almost three-times higher than in 2023.


The share of clean energy investment in emerging market and developing economies outside of China remains stuck at 15% of the total, even though these economies account for two-thirds of the global population and one-third of global GDP. A range of new business models and a policy push in some countries ensure that an additional 550 million people gain access to clean cooking and nearly 200 million to electricity in the STEPS between 2023 and 2030. This still falls well short of universal access goals.


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45