Global Electricity Demand: Surge Amid Heatwaves and AI Boom

Global electricity demand is set to grow at its fastest pace in nearly 20 years, driven by a surge in air conditioning usage amidst rising temperatures, reports the International Energy Agency (IEA). This trend, aided by AI energy needs, will keep coal in use, despite renewable energy growth.

The International Energy Agency (IEA) has reported that global electricity demand is poised to grow at its swiftest rate in nearly two decades, spurred by increased air conditioning usage amid soaring temperatures. This trend is anticipated to persist until 2025.

Despite rising production of renewable energy, coal power usage is likely to continue to support this surging demand. Severe heatwaves have led to record-high global temperatures, prompting grids to rely on dirtier baseload supplies, including coal. Keisuke Sadamori, IEA Director of Energy Markets and Security, highlighted the increasing role of electricity in economies and the impact of heatwaves.

AI-related electricity consumption from data centers is further altering demand patterns. Global power consumption is projected to grow approximately 4% in 2024 and maintain this pace into 2025. Key growth nations include India with 8% and China at 6%. While the EU aims for a 1.7% growth, the US rebounds at 3% following a mild 2023.

Renewable energy's share is expected to increase, overtaking coal by 2025. However, slight growth in coal consumption is anticipated in 2024. These changes reflect a plateau in carbon emissions from the power sector, with a minor rise expected this year followed by a decline in 2025.

(With inputs from agencies.)