European electricity demand to rebound after sharp decline, IEA forecasts

Economy Materials 13 February 2023 18:55 (UTC +04:00)
Maryana Ahmadova
Maryana Ahmadova
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BAKU, Azerbaijan, February 13. The annual growth rate of electricity demand in Europe is forecast at 1.4 percent, Trend reports via the latest electricity market update from the International Energy Agency (IEA).

As the agency noted, this is due to lower energy prices and the push for electrification.

"Electricity consumption in the EU rebounded to almost 5 percent in 2021, in line with the economic recovery, following a substantial year-on-year decline of 4 percent in 2020," the report said.

According to the research, the EU's electricity consumption sharply dropped by 3.5 percent year-on-year in 2022, as the region was particularly hard hit by high energy prices, which led to a significant decline in demand among industrial consumers.

"Exceptionally mild winter added further downward pressure on electricity consumption. This was the EU’s second largest percentage decrease in electricity demand since the global financial crisis in 2009 - with the largest being the exceptional contraction due to the COVID-19 shock in 2020," the IEA noted.

At the same time, the EU's coal-fired electricity generation increased again in 2022, rising over 6 percent, the agency added.

"Despite high gas prices, gas-fired supply actually grew by about 2 percent, largely to offset reduced nuclear power and low hydro output," the report said.

Thus, the IEA forecasts a sharp decline in fossil fuel-fired generation, as strong growth in generation from renewables of 34 percent from 2022 levels displaces fossil generation over 2023-2025.

Meanwhile, sufficient rise in nuclear generation is expected only after 2023, as French plants gradually conclude their maintenance schedules.