3.3
Electrification and the decarbonisation of the power sector
The increasing electrification of end uses must develop in parallel with the decarbonisation of the electricity supply, to fully benefit from the substitution of fossil fuel. In 2020, the decarbonisation of global power generation accelerated, with the share of low-carbon generation increasing by 1.6 percentage points in one year, compared with a cumulative increase of 4.1 percentage points over 2010‑2019 (see Figure 3.1 at the beginning of this chapter).
There are two underlying aspects behind this increasing share of low-carbon generation: the first, a decrease of total generation mirroring a situation similar to that seen for the increase of electrification (i.e. a decrease of total energy demand); the second aspect is a continued increase of low-carbon generation providing an opposite movement to the electrification trends (i.e. a decrease of electricity demand in several cases). While the former can be expected to be a temporary issue due to the effects of the Covid‑19 pandemic, the second reflects a structural change of the power generation mix.
Global power electricity generation in 2020 decreased by almost 240 TWh, an amount almost equivalent to the total electricity generation of Australia. This decrease compares with an average annual growth of 600 TWh over the previous decade (about equal to total electricity production in Germany) and is the direct consequence of the lower demand in end-use sectors. Total power generation decreased in 14 out of the 15 countries analysed in this report, with the significant exception of China, which registered a continued increase albeit at a slower pace than in the previous decade – at around 70% of the average growth of 2010‑2019.
Power generation from low-carbon sources kept increasing at a similar pace as in the previous years, with renewable sources more than compensating for a decrease of nuclear generation in 2020. Almost all the countries analysed saw an increase of renewable-based power generation in 2020, with an increase of their share in the mix. The only two exceptions were Colombia and Morocco due to a low-hydro year, while the increase in China and the United States accounted for half of the global increase.
The decrease of total energy demand and the rise of renewable sources brought a sharp decline of coal- and oil-fired power generation, while global gas-fired generation declined only marginally. As a result, almost all countries displayed an acceleration of the decarbonisation trends seen over 2010‑2019 (except for Colombia and Morocco). This acceleration can be expected to slow once electricity demand reverts back to previous (pre‑Covid‑19) levels, unless sufficient low-carbon generation is added to the generation mix to cover for any increased demand. The rebound of electricity demand (with the resulting increase in fossil fuel generation) may even see an increase in CO2 intensity, in particular when combined with additional factors, such as low hydro or wind generation, coal-to-gas substitution (such as in the case of Europe), or a reduction of nuclear power generation (such as in the case of Germany).
Additional efforts and a marked scale-up in the deployment of low-carbon technologies are needed to reach the ambitious goals of the APS and NZE Scenario of the IEA, requiring the global emissions intensity for power generation to decrease at a rate four to eight times faster over the coming decades compared with the past one (Figure 3.7). A scale-up of deployment of renewable technologies might prove challenging without market reforms and adequate support measures, and notably in countries where a significant portion of the renewables resources has been exploited, or where public acceptance is low (the typical not-in-my-backyard issue).