Despite Record Growth of Renewable Energy, Fossil Fuels Still Dominate

Global energy demand increased by only one percent last year, and the record growth of renewable energy is still not enough to take over the dominance still held by fossil fuels.

According to a statistical report published by Reuters, so-called ‘dirty energy’, or fossil fuels, accounted for 82 percent of total global energy supply in 2022, despite efforts from around the world.

Last year was certainly marked by turmoil in energy markets after Russia attacked Ukraine, causing gas and coal prices in Europe and Asia to rise to record high levels.

Because there was no other option but to switch to renewable sources, it was expected that the dominance of oil, gas, and coal would decline.

– Despite further strong growth of wind and solar in the energy sector, total global greenhouse gas emissions related to energy have risen again – said Juliet Davenport, president of the British global industrial body Energy Institute, adding that we are still heading in the opposite direction from what the Paris Agreement requires.

Let us remind you that greenhouse gas emissions need to be reduced by about 43 percent by 2030 to meet the international goal of the Paris Agreement.

According to the annual report first published by the Energy Institute in collaboration with consulting firms KPMG and Kearny after taking it over from BP, global energy consumption increased everywhere except in Europe, and renewable energy sources accounted for 7.5 percent of global consumption, which is about one percent more than the previous year.

Emissions Still High

Electricity production increased by 2.3 percent, which is a slowdown compared to the previous year, while production from wind and solar rose to a record 12 percent, again surpassing nuclear, which fell by 4.4 percent. The share of coal in electricity production remained dominant last year, accounting for about 35.4 percent.

Oil consumption increased by 2.9 million barrels per day to 97.3 million, with a slowdown in growth compared to the previous year. Compared to pre-pandemic levels, oil consumption was down by 0.7 percent. Oil production increased by 3.8 million barrels, with the largest share coming from OPEC members and the United States. Nigeria recorded the largest decline.

Amid record prices in Europe and Asia, global gas demand fell by three percent, but still accounted for 24 percent of total energy consumption. However, liquefied natural gas (LNG) production increased by five percent to 542 billion cubic meters, continuing to grow at a similar pace as the previous year, with the largest growth coming from North America and Asia.

A significant part of the growth in LNG demand is also attributed to Europe, which increased its imports by 57 percent, while countries in the Asia-Pacific region, South and Central America reduced their gas purchases. Additionally, Japan replaced China as the world’s largest LNG importer.

On the other hand, coal prices rose by 145 percent in Europe and 45 percent in Japan in 2022, reaching record levels, while coal consumption increased by 0.6 percent, the highest level since 2014.

Coal production was seven percent higher than the previous year, with China, India, and Indonesia being the main contributors to the growth.

The growth of renewable energy, excluding hydropower, has slightly slowed to 14 percent, but solar and wind capacities continue to show record growth of 266 gigawatts last year, with solar energy taking the largest share.

Although everyone talks about reducing global CO2 emissions, according to this report for 2022, global emissions related to energy, which include industrial processes and combustion, increased by 0.8 percent, reaching a new record level of 39.3 billion tons of CO2.