Renewables Cover All Demand Growth 2025

in Japanese

The report ”Electricity 2025”¹ by the International Energy Agency contains a remarkable prediction: Global electricity generation by renewables will increase by more than 1,200 TWh this year. This is more than the anticipated total growth in electricity consumption.
 

Year-on-year Global Change in Electricity Generation by Source, 2019-2027

The only other visible increase projected is nuclear, based on recovery of generation in France and Japan, and anticipated new units supposed to come on line in China, India and maybe other countries. Despite the relatively small increase, the IEA predicts nuclear in 2025 will reach the electricity production of the previous record, achieved back in the year 2006.

Fossil fuel based electricity generation is described as flat in the coming years.

There are regional differences. Industrialized countries have an economic growth that is of the same size as efficiency improvements resulting in no or little electricity consumption growth. Most of the demand growth, about 85%, will take place in China, India and other developing countries.

Geopolitically, countries that have been dependent on importing fossil fuels and uranium are those that gain the most, as solar and wind energy out-compete thermal power plants and even fossil fuels in transport and industry. Among those who gain most from the energy industry developments are Japan and the EU. But also a large number of people and countries in Africa and Asia.

Some countries with large domestic fossil fuel resources have also started to utilize solar or wind energy – and succeeded to do so at low cost. Among these are traditional oil exporters United Arab Emirates and Saudi Arabia, but also the US.

The main loser is Russia. Russia has been among the two largest net exporters of fossil gas and oil. If reduced demand result in lower prices of fuels, income will decrease. Russia also controls much of the nuclear fuel supply chain. Together with the other members of the ”Commonwealth of Independent States” they host half of the uranium mining in the world². All nuclear construction projects started in the world outside China since 2019 are being built by Russian suppliers³. Unlike the other large fuel exporters they have not developed the new, low cost opportunities.

Human civilization may benefit if the energy industry continues to develop fast enough to avoid climate change at unmanageable speed, as well as nuclear weapon proliferation, and war.

But besides Russia, the private owners of fossil resources and thermal power plants have an interest to protect the value of their assets by delaying the growth of renewable electricity.

The IEA seems to believe the battle is won by means of competitiveness in the market. While this is likely correct in the long run, the development can be delayed by politics – as seen in some countries where Russian or fossil industry influence is strong.