A new report from the International Energy Agency, Electricity 2024, has looked at present consumption and expected demand for the form of energy to 2026. As usual with IEA reports, there is an interesting range of findings and projections.

Perhaps the most striking is that per capita, electricity consumption in Africa is currently around what it was in the 1990s, and has even declined in recent years as growth in electricity generation has not kept up with growth in population. Conversely, while per capita consumption in India and Southeast Asia was lower than in Africa three decades ago, in India it is now twice what it is in Africa, and in Southeast Asia 40% higher than in Africa, reflecting strong economic growth in those Asian areas.

Also interesting is the finding that electricity consumption by data centres, artificial intelligence and cryptocurrency “could double” between 2024 and 2026; data centres alone are expected to rise from consuming 460 TWh in 2022 to 1100 TWh in 2026, “roughly equivalent to the electricity consumption of Japan”.

Electricity consumption in advanced economies generally fell in 2023, while in most of the rest of the world it grew (such that global demand grew by 2.2%), and demand growth globally is expected to pick up over the next three years, averaging an annual 3.4%. Part of this will be increased economic activity, while the other part will be increased electrification. Almost 85% of increased electricity demand is to come from non-advanced economies to 2026 – China’s is expected to grow by 1400 TWh between 2024 and 2026, roughly half of the European Union’s current total consumption. (Per capita electricity consumption is already higher in China than in the EU.)

Meanwhile, the rate of demand growth is expected to be higher in India than in China. Profoundly, all additional demand for electricity is projected to be covered by “technologies that produce low-emissions electricity”, which includes renewables and nuclear.

Carbon dioxide emissions from electricity generation are expected to decline slightly globally to 2026, with falls in China, the USA, Japan, Korea and the European Union, while emissions in India and Southeast Asia are set to rise.

The report also notes the strong advantages that US and Chinese industry enjoys over European industry in terms of electricity prices, with the gap widening such that EU prices (on average) are now almost double those in the US and China. In the words of the report, “the competitiveness of EU energy-intensive industries is expected to remain under pressure”, and the scope and effectiveness of policy initiatives and financial instruments will “likely determine the future of the European Union’s energy-intensive industrial sector”. The stakes are large indeed.