Summary
According to a new report by the International Energy Agency (IEA), global electricity demand is projected to rise at its fastest rate in years. The IEA’s latest projections are driven by robust economic growth, intense heat waves, and the increasing adoption of technologies like electric vehicles (EVs) and heat pumps. The findings suggest a significant shift in the global energy landscape, with solar PV set to meet half of the increased demand.
Deep Dive
The IEA’s latest Electricity Mid-Year Update highlights a significant rise in global electricity demand, forecasted to grow by around 4% in 2024 and continue at a similar rate into 2025.
This marks the highest annual growth rate since 2007, driven by various factors, including economic expansion and extreme weather conditions. Renewables, particularly solar PV, are set to play a crucial role in meeting this increased demand.
Renewable Expansion
Renewable electricity sources are set to expand rapidly, with their share of global electricity supply expected to rise from 30% in 2023 to 35% in 2025. Solar PV alone is projected to meet roughly half of the global demand growth over this period.
The IEA report also forecasts that in 2025, the electricity generated by renewables worldwide will surpass that of coal for the first time.
Despite the sharp increases in renewables, coal power generation is unlikely to decline. This is due to the strong demand for coal, especially in China and India. However, CO2 emissions from the global power sector are expected to plateau, with a slight increase in 2024 followed by a decline in 2025.
Regional Insights
Asia: India’s electricity demand is expected to surge by 8% this year, driven by strong economic activity and heatwaves. China is also set to see significant demand growth of more than 6%, fueled by plenty of activity in the services and industrial sectors, including clean energy technology manufacturing.
United States: After a decline in 2023, the US is forecasted to rebound with a 3% increase in electricity demand, driven by steady economic growth and rising cooling needs.
European Union: The EU will experience a modest recovery in electricity demand, with a 1.7% growth. The projected growth follows two years of contraction due to the energy crisis.
Implications for Asset Managers
Rapid electricity demand and renewable energy growth present a significant opportunity for asset managers, particularly those equipped with advanced solutions like PowerHub. Our platform can help you navigate and capitalize on these trends by improving efficiency and streamlining operations.
POWERHUB SOLUTIONS
- Simplify and automate your invoicing process, saving time while improving accuracy.
- Stay ahead of regulatory requirements with our comprehensive compliance tools.
- Manage community solar portfolios effortlessly, and maximize benefits for all stakeholders.
By utilizing PowerHub’s innovative tools, asset managers can keep pace with the evolving energy landscape and continue to drive sustainable growth and profitability.
Thoughts
With the strong growth forecasted for global electricity demand, asset managers should prepare with the software tools needed to stay organized and drive growth. PowerHub provides the necessary solutions to manage and optimize renewable energy assets efficiently. As the renewable energy sector continues to expand, taking advantage of the right software will help asset managers stay ahead in a competitive market.
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