The Covid-19 pandemic has caused more disruption to the energy sector than any other event in recent history, leaving impacts that will be felt for years to come. This IEA World Energy Outlook (WEO) examines in detail the effects of the pandemic, and in particular how it affects the prospects for rapid clean energy transitions. It is too soon to say whether today’s crisis represents a setback for efforts to bring about a more secure and sustainable energy system, or a catalyst that accelerates the pace of change. The pandemic is far from over, many uncertainties remain and crucial energy policy decisions have yet to be made.
This Outlook explores different pathways out of the Covid-19 crisis, with a particular focus on a pivotal next ten years to 2030. At this hugely consequential moment for the energy sector and for the urgent global response to climate change, the WEO-2020 illustrates the historic nature of the choices, opportunities and pitfalls that will shape where we go from here.
Our assessment is that global energy demand is set to drop by 5% in 2020, energy-related CO2 emissions by 7%, and energy investment by 18%. The impacts vary by fuel. The estimated falls of 8% in oil demand and 7% in coal use stand in sharp contrast to a slight rise in the contribution of renewables. The reduction in natural gas demand is around 3%, while global electricity demand looks set to be down by a relatively modest 2% for the year.
The 2.4 gigatonnes (Gt) decline takes annual CO2 emissions back to where they were a decade ago. However, the initial signs are that there may not have been a similar fall in 2020 in emissions of methane – a powerful greenhouse gas – from the energy sector, despite lower oil and gas output.