Global Energy Perspective 2024

| Report

While significant progress has been made in the nine years since the landmark Paris Agreement, the global energy transition is entering a new phase, marked by rising costs, complexity, and increased technology challenges. To successfully navigate this next phase and meet the Paris Agreement goals, urgent action will be needed and the pace of change must accelerate. The clean energy transition will also need to be balanced with affordability, energy system resiliency, and energy security in an increasingly uncertain macroeconomic environment.

The Global Energy Perspective 2024 is intended to serve as a fact base grounded in the best currently available data to help global stakeholders meet decarbonization goals. The report offers a detailed demand outlook for 68 sectors and 78 fuels across a 1.5° pathway, as set out in the Paris Agreement, as well as three bottom-up energy transition scenarios. These scenarios have been redesigned this year to better reflect changing global conditions, including geopolitical shifts, increasingly complex supply chains, and higher inflation. The critical question this research aims to address is how the world can achieve a step change in its efforts toward meeting net-zero goals and avoid the worst impacts of climate change.

Successfully navigating the transition away from fossil fuels will require focusing beyond a single solution or technology. There are no silver bullets—the future calls for a holistic transformation of the global energy system by incorporating a range of proven and emerging levers. To do this, considerations beyond technological feasibility will need to be addressed, spanning capital deployment, improving business cases, ensuring economic returns, adjusting regulation, and establishing continued political and public support in the face of competing economic and societal priorities.

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Our analysis of the data shows global emissions to 2050 remaining above a 1.5º pathway—even if all countries deliver on current commitments

Global emissions are projected to peak between 2025 and 2035 before beginning to decline.

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A line graph shows four scenarios of global greenhouse gas emissions from 1990 to 2050, measured in gigatons (Gt) of CO2 equivalent per annum. The values from 1990 to 2022 are historical values, represented by one line that grows from approximately 38 Gt to 53. From 2022 to 2050, four lines diverge representing the four different scenarios. The Slow Evolution scenario line increases to 54 Gt in 2030 and then decreases to 46 by 2050. The Continued Momentum scenario line initially increases, then falls to 51 Gt in 2030, and then continues to decrease to 35 by 2050. The Sustainable Transformation scenario line decreases to 46 Gt by 2030 and then continues to decrease to 18 by 2050. The 1.5º pathway line decreases to 30 Gt in 2030 and then further decreases to eight in 2050.

Source: IEA Global Energy Review 2022; IEA World Energy Balances

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Global energy demand is projected to continue to increase to 2050

The increase in global energy demand is primarily driven by growth in emerging economies.

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A stacked area chart shows global primary energy demand by region under the Continued Momentum scenario, in million terajoules, between 1990 and 2050. The regions are separated into two overall categories: those with increasing demand, including India, ASEAN, Africa, Middle East, Latin America, China, and rest of world, and those with decreasing demand, including North America, OECD Europe, and OECD Asia–Pacific. Note: OECD stands for the “Organization for Economic Cooperation and Development.” From 2023 to 2050, the total of all segments is projected to grow by 11 percent, from approximately 620 million terajoules to approximately 690 million terajoules. From 2023 to 2050, the individual-region CAGR values are: India, 2.3 percent; ASEAN, 1.2 percent; Africa, 1.0 percent; Middle East, 0.6 percent; rest of world, 0.5 percent; Latin America, 0.5 percent; China, 0.3 percent; North America, -0.1 percent; OECD Europe, -0.8 percent; OECD Asia–Pacific, -0.9 percent.

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Growth in electricity consumption is expected to accelerate as new demand centers emerge

New demand centers, including data centers, transport, and hydrogen, are projected to see rapid growth in power demand.

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A stacked column chart shows global power consumption by sector under the Continued Momentum scenario, measured in thousand terawatt-hours (TTWh). The sectors are industry, buildings, hydrogen gas (H2) and synfuels, data centers, and transport. There are columns for the years 2000, 2010, 2023, 2030, and 2050. From 2000 to 2023, the total of all segments grows from 13 to 25 TTWh, representing a 3.0 percent per year increase. These are actual values, and the stacked columns are composed almost entirely of industry and buildings. From 2023 to 2050, forecast values show the total of all segments growing from 25 to 64 TTWh, which represents a 3.5 percent per year increase. Transport, data centers, and H2 and synfuels are forecast to grow by 2050 to comprise approximately 30 percent of the total. The CAGR values by segment from 2023 to 2050 are: transport, 10 percent; data centers, 8 percent; H2 and synfuels, 20 percent; buildings, 2 percent; industry, 3 percent.

Source: IEA; IRENA

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Renewables are projected to make up the bulk of the power mix into the future

Low-carbon energy sources are projected to account for 65 to 80 percent of global power generation by 2050.

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A stacked column chart shows global power generation by energy source, measured in thousand terawatt-hours (TTWh). Historical values are shown for 1995, 2010, and 2023, and separate projections based on the Slow Evolution, Continued Momentum, and Sustainable Transformation scenarios are shown for 2030, 2040, and 2050. The historical totals are: 1995, 13 TTWh; 2010, 19; 2023, 28. The 2030 totals by scenario are: Slow Evolution, 32 TTWh; Continued Momentum, 33; Sustainable Transformation, 36. The 2040 totals by scenario are: Slow Evolution, 43 TTWh; Continued Momentum, 50; Sustainable Transformation, 58. The 2050 totals by scenario are: Slow Evolution, 59 TTWh; Continued Momentum, 70; Sustainable Transformation, 79. The 2023–40 CAGR values for Continued Momentum, by energy source, are: other, 3 percent; solar, 12 percent; wind offshore, 15 percent; wind onshore, 10 percent; hydro, 1 percent; clean firm, 3 percent; gas, 0 percent; coal, -3 percent. Note: clean firm includes gas and coal plants with carbon capture, utilization, and storage (CCUS); nuclear; and hydrogen. The percentage share of renewables historical totals are: 1995, 19 percent; 2010, 18 percent; 2023, 32 percent. By 2050, the percentage share of renewables totals by scenario are projected to be approximately 65 percent for Slow Evolution, approximately 75 percent for Continued Momentum, and approximately 80 percent for Sustainable Transformation. The gigatons (Gt) of CO2 emissions historical totals are: 2010, approximately 11 Gt; 2023, 13 Gt. By 2050, the Gt of CO2 emissions totals by scenario are projected to be: approximately 11 Gt for Slow Evolution, approximately 9 Gt for Continued Momentum, and approximately 4 Gt for Sustainable Transformation.

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Challenges facing RES build-out, including power pricing and firmness, need to be overcome

Hourly prices are becoming more volatile in regions such as Europe.

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A bar chart shows the number of yearly occurrences of day-ahead negative electricity prices in the EU plus Norway and Switzerland, from 2017 to 2023. Note: one occurrence corresponds to one hour during which prices are negative. The number of occurrences by year are: 834 in 2017, 510 in 2018, 925 in 2019, 1,923 in 2020, 952 in 2021, 558 in 2022, and 6,470 in 2023. From 2022 to 2023, the number of occurrences increased by 12 times.

Source: European Union Agency for the Cooperation of Energy Regulators (ACER)

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Fossil demand is set to decrease, but fossil fuels are expected to continue to help meet growing energy demand across all scenarios

Fossil demand is projected to plateau before declining, but still accounts for 40 to 60 percent of total energy demand in 2050.

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Three stacked area charts show global primary energy demand by fuel, in million terajoules, across the Sustainable Transformation, Continued Momentum, and Slow Evolution scenarios. There are three categories of fuel included: natural gas, oil, and coal. All three charts show 1990 to 2050, with the 2023–50 values representing the differing projections. Historical values from 1990 to 2023 increased from approximately 300 million terajoules, to approximately 430 million terajoules, with brief dips around 2009 and 2020. Going forward from 2023, all three scenarios are projected to plateau and then decline toward 2050. Sustainable Transformation has the shortest plateau and the most dramatic decline, reaching a 2050 total of approximately 240 million terajoules. This represents 39 percent of the total energy demand projected for 2050. Under this scenario, from 2023 to 2050, the CAGR for natural gas is -1 percent; for oil, -3 percent; and for coal, -5 percent. In the next chart, showing Continued Momentum, there is a longer plateau and less dramatic decline, reaching a 2050 total of approximately 360 million terajoules. This represents 52 percent of the total energy demand projected for 2050. Under this scenario, from 2023 to 2050, the CAGR for natural gas is 0 percent; for oil, -2 percent; and for coal, -3 percent. The last chart, representing Slow Evolution, has the longest plateau and smallest overall decline to 2050, reaching a final total of approximately 440 million terajoules. This represents 61 percent of the total energy demand projected for 2050. Under this scenario, from 2023 to 2050, the CAGR for natural gas is 1 percent; for oil, -1 percent; and for coal, -2 percent.

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Significant grid build-out will be needed to enable electrification, with T&D investments required to grow threefold

Increased transmission and distribution investments will be needed, increasing the share of grid cost in system costs for power customers.

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Four sets of stacked column charts show the system cost of electricity under the Continued Momentum scenario, measured in dollars per megawatt-hour ($MWh). The four charts represent the United States, Brazil, Germany, and the United Kingdom, each with stacked columns for the years 2024, 2030, 2040, and 2050. The stacks comprise three segments: distribution, transmission, and generation. For the United States, from 2024 to 2030, the total has a 0.4 percent CAGR, increasing from approximately 118 $MWh to approximately 121. From 2024 to 2050, the total has a -0.8 percent CAGR, decreasing from approximately 118 $MWh to approximately 97. The 2024–50 CAGR values by segment are: 0 percent for distribution, 2 percent for transmission, and -2 percent for generation. For Brazil, from 2024 to 2030, the total has a -1.0 percent CAGR, decreasing from approximately 107 $MWh to approximately 101. From 2024 to 2050, the total has a 0 percent CAGR, arriving at a total of approximately 108 $MWh in 2050. The 2024–50 CAGR values by segment are: 1 percent for distribution, 4 percent for transmission, and -2 percent for generation. For Germany, from 2024 to 2030, the total has a 0.5 percent CAGR, increasing from approximately 188 $MWh to approximately 195. From 2024 to 2050, the total has a 0.2 percent CAGR, increasing from approximately 188 $MWh to approximately 199. The 2024–50 CAGR values by segment are: 1 percent for distribution, 4 percent for transmission, and -3 percent for generation. For the United Kingdom, from 2024 to 2030, the total has a 2.2 percent CAGR, increasing from approximately 168 $MWh to approximately 191. From 2024 to 2050, the total has a 0.2 percent CAGR, increasing from approximately 168 $MWh to approximately 175. The 2024–50 CAGR values by segment are: 0 percent for distribution, 3 percent for transmission, and -1 percent for generation.

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Slowdown in the uptake of energy efficiency technologies could lead to electricity demand not materializing in Europe

In Europe, up to 40 percent of the anticipated 460 terawatt-hour increase in electricity demand from 2023 to 2030 may not materialize.

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A waterfall chart shows expected electricity demand growth in Europe from 2023 to 2030, in terawatt-hours (TWh), under the Continued Momentum scenario. Each step is divided into baseline growth and at-risk growth. Buildings contribute 17 TWh, with 100 percent share categorized as at risk. Transport has 70 TWh baseline growth and 58 at risk, thus approximately 45 percent share at risk. Industry has 58 TWh baseline growth and 66 at risk, thus approximately 55 percent share at risk. Green H2 has 79 TWh baseline growth and 22 at risk, thus approximately 20 percent share at risk. Data centers have 70 TWh baseline growth and 21 at risk, thus approximately 25 percent share at risk. Overall, these categories total 277 TWh baseline growth and 164 at risk, thus approximately 40 percent share at risk. In total, including baseline growth and at-risk growth, this is an increase of 461 TWh, or 16 percent, from 2023 to 2030.

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In the European Union and the United States, the deployment pipeline for several technologies falls short of 2030 targets

Less than half of the deployment pipeline for low-carbon power has reached final investment decision, despite significant investment announcements.

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A series of stacked bar graphs shows the technology deployment pipeline in the EU-27 plus three (EU-27 plus Norway, Switzerland, and the United Kingdom) and the United States versus 2030 targets (in which tech deployment is measured to understand the gap between actual versus needed deployment), as a percentage of those targets. In low-carbon power generation, announced solar photovoltaic projects meet and exceed the target by 3 percent. Operational deployments in 2023 represent less than 15 percent of the 205 gigawatt (GW) target for offshore wind, approximately 60 percent of the 695 GW target for onshore wind, and 75 percent of the 705 GW target for solar photovoltaic. In clean commodities production, announced clean hydrogen projects exceed the target by 98 percent. Operational deployments in 2023 represent less than 5 percent of the 15 million metric-ton-per-annum (MTPA) target for clean hydrogen and approximately 10 percent of the 136 MTPA target for sustainable fuels. In end-use decarbonization, announced carbon capture, utilization, and storage (CCUS) projects exceed the target by 473 percent. Operational deployments in 2023 represent less than 30 percent of the 56 million target for electric vehicles, approximately 40 percent of the 156 million target for heat pumps, and approximately 30 percent of the 75 MTPA target for CCUS.

Source: EHPA; EIA; Eurostat; IEA; Rystad; Wind 4C; McKinsey Energy Solutions; McKinsey Hydrogen Insights

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