Thursday, 05 August, 2021

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Global electricity demand: Rebound expected in 2022


After falling by around 1% in 2020, global electricity demand is set to grow by close to 5% in 2021 and by 4% in 2022. 

The International Energy Agency (IEA) announced this in its 2021 Electricity market report.

Asia is expected to dominate global demand.

While the report revealed that renewable electricity generation continues to grow strongly, it insists it cannot keep up with increasing demand. 

“After expanding by 7% in 2020, electricity generation from renewables is forecast to increase by 8% in 2021 and by more than 6% in 2022. Despite these rapid increases, renewables are expected to be able to serve only around half of the projected growth in global demand in 2021 and 2022. Nuclear power generation will grow by around 1% in 2021 and by 2% in 2022.”

IEA report

Pricing

The IEA Wholesale Electricity Market Price Index, which tracks price movements in major advanced economies, shows that prices were 54% higher in the first half of 2021 compared with the same period in 2020.

This is after average prices for the full year 2020 declined by 25% compared with 2019.

The reasons for these large swings are strong variations in fossil fuel prices caused by the Covid-19 crisis during 2020 as well as related changes in electricity demand.