EVs Surge and Oil Demand Slows: A Rapid Global Energy Shift in 2024

In a groundbreaking report released by the International Energy Agency (IEA), global energy demand witnessed a significant surge in 2024, primarily driven by an unprecedented rise in electricity consumption. The increase was staggering—almost 1,100 terawatt-hours, representing a 4.3% growth that nearly doubles the average annual increase seen in the past decade.

This sharp uptick in electricity usage can be attributed to several factors: the electrification of transportation is playing a significant role, alongside record-breaking global temperatures that have heightened the need for cooling systems, increased industrial activities, and the swelling demand from burgeoning data centers and artificial intelligence applications.

In this scenario, renewable energy sources emerged as the champions of meeting this growing energy requirement. The IEA's latest iteration of the Global Energy Review highlights that approximately 700 gigawatts (GW) of new renewable power capacity was installed last year, marking it as the 22nd consecutive year of record growth. Notably, renewables, alongside nuclear energy—which recorded its fifth-highest growth in three decades—accounted for an impressive 80% of the global electricity supply increase. Together, they hit a remarkable milestone, now supplying 40% of the total global electricity generation for the very first time.

Fatih Birol, the IEA’s executive director, emphasized the significance of these developments, stating: “Electricity use is growing rapidly, pulling overall energy demand up to a level that reverses years of declining energy consumption in advanced economies.” He pointed to a constructive trend, noting: “The robust growth of solar, wind, nuclear power, and electric vehicles (EVs) is increasingly breaking the link between economic growth and emissions.”

Among fossil fuels, natural gas exhibited the largest growth with a rise of 115 billion cubic meters (bcm), or 2.7%, spurred mainly by this soaring electricity demand. In contrast, oil demand growth moderated to only 0.8%—a stark change influenced by the rapid increase in EV sales, which soared over 25% in 2024. Now, 1 in every 5 cars sold worldwide is an electric vehicle, highlighting the significant impact of this rapidly evolving market on energy consumption patterns. For the first time, oil demand also fell below 30% of total energy demand, a drastic shift 50 years after it reached a peak of 46%.

Coal consumption did experience an uptick of 1%, yet it slowed significantly compared to growth rates in preceding years, with extreme heatwaves in China and India responsible for over 90% of this increase.

In terms of emissions, the data painted an optimistic picture: CO2 emissions in advanced economies fell by 1.1% to 10.9 billion tonnes, a level not witnessed in half a century, even as these economies have tripled in size. Overall, global CO2 emissions saw an annual increase of 0.8% to hit 37.8 billion tonnes, primarily driven by record heat. Nevertheless, the rapid uptake of clean energy technologies since 2019 is now preventing 2.6 billion tonnes of CO2 emissions per year, accounting for roughly 7% of global emissions.

Dr. Birol summarized these findings succinctly: “From the deceleration of global oil demand growth and the dramatic rise in electric vehicle adoption to the expanding importance of electricity and the progressive separation of emissions from economic growth, many critical trends identified by the IEA are clearly evident in the 2024 data.”

As we look to the future, the 2024 energy landscape is a clear signal of a monumental shift towards sustainable energy solutions. Don't miss out on this rapidly changing scene; the world is witnessing an unmistakable transition that could redefine our energy consumption for generations to come!