The Peak of Fossil Fuel Dependence: A Turning Point for Global Energy

As the world grapples with the imperatives of climate change, a significant milestone has been reached in the quest for sustainable energy. According to the Energy Institute (EI), major advanced economies have likely peaked in their dependence on fossil fuels. This conclusion is drawn from the latest data showing European hydrocarbon usage falling below 70% of primary energy for the first time since the industrial revolution, driven by a combination of demand reduction and the growth of renewable energy sources.

The 73rd annual edition of the Statistical Review of World Energy, previously produced by BP and also presented by the EI, underscores this pivotal shift. In the United States, fossil fuel consumption has dropped to 80% of total primary energy in 2023. Meanwhile, emerging economies continue to face challenges in reducing fossil fuel reliance, although China has shown remarkable progress in expanding its renewable energy sector.

In Europe, the reduction in fossil fuel consumption is particularly notable. In 2023, Europe’s fossil fuel consumption decreased by 6%, with coal usage halved over the past decade. France, traditionally a low fossil fuel consumer, saw a 48% reduction last year. No European country saw an increase in fossil fuel consumption in 2023, suggesting a steadfast commitment to energy transition.

The response to the Russia-Ukraine conflict has also demonstrated the adaptability of energy markets. Wayth noted that market rebalancing and consumer responsiveness to price signals could accelerate the energy transition.

Growing Pains in Developing Economies

Globally, the picture is more complex. In India, fossil fuel consumption surged by 8%, now accounting for nearly all energy demand growth and 89% of overall consumption. For the first time, India’s coal consumption exceeded that of Europe and North America combined. In Africa, primary energy consumption decreased slightly by 0.5% in 2023, with fossil fuels making up 90% of the total energy mix.

China presents a mixed yet hopeful scenario. While its post-Covid recovery saw a 6% increase in fossil fuel use, the share of primary energy from fossil fuels has been declining since 2011, reaching 81.6% in 2023. Notably, China contributed 55% of all global renewable generation additions in 2023, surpassing the rest of the world combined. The country also overtook Europe in energy consumption per capita for the first time.

The Chinese power sector’s transformation is particularly significant, with over half of global additions in renewable energy generation attributed to China. Moreover, the surge in electric vehicle (EV) sales is poised to impact fuel demand significantly. In 2024, China’s electric car sales are projected to reach about 10 million, nearly half of all new car sales.

The data from the Energy Institute’s latest report paints a picture of a world at a critical juncture in its energy transition. Advanced economies are moving decisively away from fossil fuels while developing economies face more significant challenges and opportunities for rapid renewable energy adoption. The path to net zero is uneven but increasingly clear, with regional variations shaping the global energy landscape. The progress in renewable energy, particularly in China, offers a promising glimpse into a future where sustainable energy sources dominate, paving the way for a more resilient and equitable global energy system.

Source and Images: BP & Energy Institute