More warnings as emissions rise and fossil fuels continue to dominate

The world’s energy usage has increased to above pre-COVID levels with fossil fuels still making up the huge majority of power sources.

The Energy Institute (EI) along with KPMG and Kearney has released the 72nd annual edition of the Statistical Review of World Energy, delivering for the first time full global energy data for 2022.

It found Global primary energy consumption grew by around 1% in 2022, taking it to nearly 3% above the 2019 pre-COVID level. Within this, gas fell by 3% and renewables (excluding hydro) increased by 13%. However, the dominance of fossil fuels was largely unchanged at almost 82% of total consumption.

There was further unwelcome news, as the research found Global energy-related emissions continued to grow, up 0.8%, despite strong growth in renewables.

Post-COVID, transport fuel demand patterns continued to return, but with major variations across geographies and fuel types. China was a major outlier, in particular in terms of jet fuel remaining significantly below its pre-COVID level, due to its ‘zero COVID’ policy.

Unsurprisingly the Ukraine conflict and curtailment of Russian supplies to Europe precipitated record international gas prices in Europe (a threefold increase) and Asia (twofold), and unprecedented shifts in global oil and gas trade flows.

EI CEO, Nick Wayth, said: “As the world emerged from the pandemic and its impact on demand, 2022 witnessed energy markets again in crisis, with the Ukraine conflict upending assumptions about supply around the world. That in turn precipitated a price crisis and profound cost-of-living pressures across many economies.

On the plus side the report found strong pace of deployment of renewables in the power sector continued, driven by solar and wind. 2022 saw the largest ever increase in wind and solar new build capacity. Together they reached a record 12% share of power generation, with solar up 25% and wind up 13.5%. Renewables (excluding hydro) met 84% of net electricity demand growth in 2022.

EI president Juliet Davenport OBE explained: “The EI Statistical Review provides a high-level view of how our energy systems are adapting to escalating geopolitical and environmental crises.

“2022 saw some of the worst ever impacts of climate change – the devastating floods affecting millions in Pakistan, the record heat events across Europe and North America – yet we have to look hard for positive news on the energy transition in this new data.

“Despite further strong growth in wind and solar in the power sector, overall global energy-related greenhouse gas emissions increased again. We are still heading in the opposite direction to that required by the Paris Agreement.”

The report found carbon dioxide emissions from energy use, industrial processes, flaring and methane (in carbon dioxide equivalent terms) continued to rise to a new high growing 0.8% in 2022 to 39.3 GtCO2e, with emissions from energy use rising 0.9% to 34.4 GtCO2. In contrast, carbon dioxide emissions from flaring decreased by 3.8% and emissions from methane and industrial processes decreased by 0.2%.

Simon Virley Vice Chair and Head of Energy and Natural Resources, KPMG in the UK the world needed to address the continued dominance of fossil fuels.

“Despite record growth in renewables, the share of world energy still coming from fossil fuels remains stubbornly stuck at 82%, which should act as a clarion call for governments to inject more urgency into the energy transition,” he continued.

His warning was backed by Richard Forrest, global sustainability lead partner and chair Energy Transition Institute, Kearney.

“2022 was a turbulent year for the energy industry, with the Ukraine conflict and the tail end of the pandemic driving energy cost and security concerns to the top of the priority list in many regions,” he said “The global energy consumption increased 1.1% over the year, with a 0.8% increase in greenhouse gas emissions reinforcing the need for urgent action to get the world on track to meet the Paris targets. The need to drive the energy transition at pace to deliver clean, affordable and secure energy has never been greater.”