Global energy demand is set to soar over the next two decades, threatening to “stress” the world’s energy systems as countries struggle to maintain supply, the International Energy Agency said Wednesday. The agency advised that significant investments and policy changes are needed to ensure that enough oil and natural gas are drilled and renewable energy projects are developed to match the pace of global consumption.
In its annual World Energy Outlook, the Paris-based agency projected that global demand will rise by 37 percent by 2040. “As our global energy system grows and transforms, signs of stress continue to emerge,” IEA Executive Director Maria van der Hoeven said in a statement.
That growth, however, actually signals a slowdown in demand compared with previous decades. Aggressive policies and new technologies to boost energy efficiency in buildings, factories and cars have helped to curb some of the world’s appetite for energy. The pressure on energy systems “would be even greater if not for efficiency measures that play a vital role in holding back global demand growth,” according to an agency press release.
According to the IEA report, the use of coal and oil will steadily plateau, while natural gas use and consumption of low-carbon fuels like nuclear power and wind and solar will grow the strongest. Renewables could account for nearly half of the world’s increase in power generation over the next three decades, and overtake coal as the leading source of electricity, the agency said.
“Renewables are expected to go from strength to strength, and it is incredible that we can now see a point where they become the world’s number one source of electricity generation,” Van der Hoeven said.
Much of the growth in global energy demand will come from India, which would overtake China as the leading engine of energy consumption by the mid-2020s as China’s population levels off and its economic growth slows, the IEA said in its report.