Renewable energy is the only generation source ‘holding up’ during the pandemic and is still expected to post growth in 2020, according to a new report.
Despite supply chain disruptions that have paused or delayed some projects, solar PV and wind are on track to help lift renewable generation by 5% this year, aided by higher output from hydropower.
However, Dr Fatih Birol, the International Energy Agency (IEA)’s Executive Director, said the plunge in demand for nearly all major fuels is “staggering”, especially for coal, oil and gas.
The IEA said the crisis represents the biggest shock to the global energy system in more than seven decades and will lead to a significantly different energy industry in the future. The drop in demand this year is set to dwarf the impact of the 2008 financial crisis but will also see a record annual decline in carbon emissions of almost 8%.
“It is still too early to determine the longer-term impacts, but the energy industry that emerges from this crisis will be significantly different from the one that came before,” said Birol.
Meanwhile the Chief Executive of energy giant Royal Dutch Shell has said the crisis may lead to an acceleration in the transition to a low-carbon system. In a research note on the group’s first quarter results, analysts at Barclays also predicted that “companies growing low-carbon businesses should eventually be rewarded by the market.”