Financial Services, January 24 (Editor Niu Zhanlin) The International Energy Agency (IEA) said on Wednesday that global electricity demand will accelerate in the next three years, but renewable energy generation such as wind, solar, and nuclear energy is expected to meet the surging demand for electricity, adding that the power industry's carbon emissions are declining.

According to the latest report released by the IEA, driven by the booming development of emerging economies, artificial intelligence, cryptocurrencies, and data centers, electricity demand will increase by an average of 3.4% per year from now until 2026. About 85% of the increase in demand will come from China, India, and Southeast Asia, while electricity consumption in developed economies will decline.

However, carbon dioxide emissions from global power generation are expected to decline because by 2026, low-emission energy sources such as wind, solar, hydro, and nuclear power may account for nearly half of the world's total electricity generation, and this share will be less than 40% in 2023. By early 2025, renewable energy generation is expected to exceed coal-fired power generation, accounting for more than one-third of total power generation.

IEA Director Birol said, “Currently, the power industry produces more carbon dioxide emissions than any other industry, but it is encouraging that the rapid growth of renewable energy and the steady expansion of nuclear power are expected to meet the growth in global electricity demand over the next three years.”

Birol said, “This is largely due to the huge development momentum of renewable energy, led by increasingly cheaper solar energy, and also due to the important return of nuclear power. Nuclear power generation is expected to reach a record high by 2025. And the trend is expected to continue.”

“Decoupling global electricity demand and emissions will be significant as the energy sector becomes increasingly electrified and consumers use technologies such as electric vehicles and heat pumps,” the report said.

Nuclear power continues to expand

The increase in renewable and nuclear power generation appears to be driving the electricity sector's emissions into a structural decline. According to reports, in 2023, global carbon dioxide emissions from power generation increased by 1%, but the IEA predicts that it will drop by more than 2% this year, and the decline will be even smaller in the next two years. According to the IEA, coal-fired power generation is expected to drop by an average of 1.7% per year from now until 2026.

Rapid growth in renewable energy will be supported by nuclear power. According to the above report, although some countries are phasing out nuclear power or shutting down nuclear power plants early, nuclear power generation will still increase by an average of about 3% per year by the end of 2026.

As France's power generation continues to recover from its 2022 low, several nuclear power plants in Japan are back online, and new reactors in Europe, China, India, and South Korea will also start operating, and global nuclear power generation is expected to reach record levels.

According to the IEA, Asia is likely to remain the main driving force for nuclear power growth. By 2026, Asian nuclear power will account for 30% of global nuclear power generation.

By 2023, electricity prices will generally be lower than in 2022. However, price trends in different regions vary greatly, affecting their economic competitiveness. After the Russian-Ukrainian conflict, wholesale electricity prices in Europe hit a record high in 2022, falling by an average of more than 50% by 2023. However, electricity prices in Europe last year were still more than double what they were before the pandemic, while electricity prices in the US were about 15% higher than in 2019.