Economic Growth Delinks from Emissions: IEA

Global energy-related carbon dioxide emissions were flat for a third straight year in 2016 even as the global economy grew, according to the International Energy Agency (IEA) March 17.

The US and the UK both saw a lot of coal displaced from the power generation sector, with more power generated by gas than coal in the US last year for the first time -- something that the US Energy Information Administration (EIA) forecast a year ago.

Global emissions from the energy sector stood at 32.1 gigatonnes last year, the same as in the previous two years, while the global economy grew by 3.1%, according to estimates from the IEA. Carbon dioxide emissions declined in the US and China, the world’s two-largest energy users and emitters, and were stable in Europe, offsetting increases in most of the rest of the world.

The biggest drop came from the US, where carbon dioxide emissions fell by 3%, or by 160mn metric tonnes, while the economy grew by 1.6%. Emissions were at their lowest level since 1992, a period during which the economy grew by 80%.

There could be more to come. Gas production in the US could keep growing strongly which would boost domestic manufacturing, supply more competitive gas to Asia through to LNG exports, and provide alternative gas supplies to Europe, the IEA said.

In the European Union, emissions were largely stable last year as gas demand rose about 8% and coal demand fell 10%. Renewables also played a significant, but smaller, role. The UK saw a significant coal-to-gas switching in the power sector, thanks to cheaper gas and a carbon price floor.

(Credit: IEA)

All this represents a “sign that market dynamics and technological improvements matter [...] especially true in the US where abundant shale gas supplies have become a cheap power source,” said IEA executive director Fatih Birol (pictured above) although he added that it was too soon to say that global emissions have definitely peaked.

In 2016, renewables supplied more than half the global electricity demand growth, with hydro accounting for half of that share. The overall increase in the world’s nuclear net capacity last year was the highest since 1993, with new reactors coming online in China, the US, South Korea, India, Russia and Pakistan, the IEA said.

William Powell