BAKU, Azerbaijan, July 21
By Leman Zeynalova – Trend:
Investments in the global electricity sector are expected to increase by 5 percent in 2021, after remaining flat in 2020 because of the Covid-19 pandemic, Trend reports with reference to the International Energy Agency (IEA).
“The major areas of spending are renewable energies, with a share of more than 45 percent of investment, and electricity networks (30 percent). Annual grid investments, which had been falling since 2016, are expected to increase again, boosted by large expansion plans for 2021 and onwards and by Covid-19 recovery packages. Final investment decisions for coal power plants have fallen significantly in recent years. In 2020, however, they reached 20 GW, the first increase since 2015.
China accounted for almost 13 GW of the total, a rise of 45 percent from 2019. Despite the difficult economic climate in 2020, investments in battery storage increased by almost 40 percent. Average costs continued to decline, falling by 20 percent. Spending on grid-scale batteries grew by more than 60 percent, as shares of variable renewables increased and a growing number of hybrid auctions encouraged the use of energy storage to supplement variable renewable capacity. As a result of pandemic-related economic turbulence, investments in “behind-themeter” battery storage by households and small and medium companies fell by 12 percent,” reads the report published by IEA.
After global electricity demand declined by about 1 percent in 2020, the agency expects strong growth of close to 5 percent in 2021 and 4 percent in 2022, resulting in average annual growth in the years 2020 to 2022 similar to the average growth in the three years before the Covid-19 pandemic.
“We expect the majority of demand growth to occur in the Asia Pacific region. China has contributed the majority of electricity demand growth in the past two decades. After accounting for 10 percent of global electricity demand in 2000, China’s share increased to 20 percent in 2010 and above 30 percent in 2020. From 2000 until today, more than 50 percent of the global net increase in demand took place in China, increasing the country’s per capita consumption more than five times to a level similar to the European average. In 2020, China was the only major economy where electricity demand grew, although at a rate (4 percent) significantly below average growth in the three preceding years (6.6 percent). Given the strong demand growth towards the end of 2020 and in the first half of 2021, we expect annual consumption to grow by 8 percent in 2021 and 6.5 percent in 2022.”
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