Energy-related CO2 emissions increased last year, but slower than in 2022, says IEA

Energy-related CO2 emissions increased last year, but slower than in 2022, says IEA
Global energy-related CO2 emissions rose less fast in 2023 than 2022, in part because of the use of more renewable energy. / GWEC
By bne IntelliNews March 6, 2024

In 2023, global CO2 emissions from energy rose at a slower pace compared with the previous year. Despite a surge in total energy demand growth, analysis from the International Energy Agency (IEA) indicates that the expansion of solar PV, wind power, nuclear energy and electric vehicles (EVs) helped limit the reliance on fossil fuels.

Clean energy technologies played a crucial role in curbing a potentially larger increase in CO2 emissions over the past five years, said IEA.

Emissions saw a 1.1% uptick in 2023 totalling 410mn tonnes, in contrast to the 490mn tonne increase in the preceding year. This most recent rise brought emissions to a new peak of 37.4bn tonnes.

An unprecedented decline in hydropower, caused by severe droughts in China, the United States and other economies, led to more than 40% of the emissions rise as countries turned predominantly to fossil fuels to compensate. Were it not for reduced hydropower output, global CO2 emissions from electricity generation would have actually decreased, mitigating the overall rise in energy-related emissions, said the agency.

These insights stem from the IEA's yearly assessment of global energy-related CO2 emissions, alongside the debut of its Clean Energy Market Monitor. This new series offers up-to-date monitoring of clean energy adoption for specific technologies, shedding light on broader implications for global energy markets.

Advanced economies witnessed a historic drop in their CO2 emissions in 2023 despite economic growth. Their emissions reached a 50-year low, accompanied by a decline in coal demand to levels not seen since the early 1900s.

The reduction in emissions within advanced economies stemmed from increased deployment of renewables, a shift from coal to gas, enhancements in energy efficiency and a softer industrial output. Last year marked the first time in which low-emissions sources such as renewables and nuclear accounted for at least half of electricity generation in advanced economies.

“The clean energy transition has undergone a series of stress tests in the last five years – and it has demonstrated its resilience,” said IEA executive director Fatih Birol. “A pandemic, an energy crisis and geopolitical instability all had the potential to derail efforts to build cleaner and more secure energy systems. Instead, we’ve seen the opposite in many economies. “

He continued: “The clean energy transition is continuing apace and reining in emissions – even with global energy demand growing more strongly in 2023 than in 2022. The commitments made by nearly 200 countries at COP28 in Dubai in December show what the world needs to do to put emissions on a downward trajectory. Most importantly, we need far greater efforts to enable emerging and developing economies to ramp up clean energy investment.”

Between 2019 and 2023, clean energy growth outpaced fossil fuels twofold, said IEA. The agency’s recent analysis indicates that adopting clean energy tech over the past five years significantly restrained fossil fuel demand, hastening the shift away from them this decade.

Wind and solar PV deployment in global electricity systems since 2019 circumvented yearly coal use equivalent to India and Indonesia's electricity sectors combined, and diminished annual natural gas demand akin to Russia's pre-war exports to the EU. With electric cars making up one-fifth of new global car sales in 2023, oil demand – in terms of energy content – stayed below pre-pandemic levels.

The Clean Energy Market Monitor underscores the imbalance in clean energy deployment, primarily in advanced economies and China, emphasising the need for greater global efforts to boost clean energy investment and deployment in emerging markets.

In 2023, advanced economies and China dominated 90% of new solar PV and wind power installations globally, and 95% of EV sales. However, not all clean energy sectors progressed equally; heat pump sales dipped slightly, underscoring the necessity for ongoing policy support for fair transitions.

China's clean energy deployment surged, with it adding as much solar PV capacity in 2023 as the entire world did in 2022. Nevertheless, a dismal year for hydropower output and post-pandemic economic resurgence drove up China's emissions by approximately 565mn tonnes.

In India, robust GDP growth propelled emissions up by about 190mn tonnes in 2023. A weaker than normal monsoon boosted electricity demand and reduced hydropower output, contributing a quarter to India's emissions hike. Despite this, India's per capita emissions remain well below the global average.