Global demand for fossil fuels to peak before 2030, says IEA director

Fatih Birol added that this is the first time that a peak in demand is visible for each fuel this decade, and it is earlier than most people anticipated

The demand for fossil fuels - oil, gas and coal - would peak before the end of this decade, the director of the International Energy Agency, Fatih Birol, said on Tuesday, citing projections by the agency.

In an article in the Financial Times (FT), Biroh said that IEA will release its World Energy Outlook for this year next month. It "shows the world is on the cusp of a historic turning point".

Birol added that this is the first time a peak in demand is visible for each fuel this decade, and it is earlier than most people anticipated. For coal, Birol said that as solar and wind dominate the expansion of electricity systems, the investments in fossil fuels are drying outside China.

 

Even inside China, which is the largest user of coal, there is an "impressive" growth of renewables and nuclear power. Birol also emphasised "structural shifts" in China's economy as it moves from heavy industry to less energy-intensive industries and services.

For oil, Birol said that the growth of electric vehicles across the globe will lead to its demand hitting a peak before 2030. "Electric buses and two- and three-wheelers are also growing strongly, especially in emerging economies, further eating into demand," he said.

For gas, he said that the "golden age of gas" is nearing its end. This is due to the use of renewable energy in producing energy, the rise of heat pumps and Europe's shift away from gas after the war in Ukraine.

IEA, according to another report by FT, said that the rollout of renewable technology has accelerated in the last 12 months.

However, while acknowledging renewables' speedy adoption, Birol added that current policies are "nowhere near steep" enough to limit global warming to 1.5 degrees Celsius. He said it would require "significantly stronger and faster" policy action by governments across the globe.

"With today's policies already bringing the fossil fuel peaks into sight, decision-makers need to be nimble," he said.

According to experts, however, in India the demand for fossil fuels will continue to rise in the foreseeable future.