IEA Report Electricity 2024 | 02 Feb 2024

Source: DTE

Why in News?

Recently, the International Energy Agency (IEA) unveiled key insights into India's energy future with its report "Electricity 2024."

• This comprehensive analysis highlights trends, such as the persistent role of coal, a surge in renewable energy, and the promising growth of nuclear power, shaping India's power sector until 2026.

What are the Key Highlights of the Electricity Report 2024?

• Continued Reliance on Coal:
  • India is projected to rely on coal to meet rising electricity demand through 2026.
    • Coal-fired generation is expected to meet 68% of India's electricity demand by 2026, despite a decrease from 74% in 2023.
    • Coal-fired power generation is expected to rise by 2.5% annually (2024-2026).
    • Despite India’s net-zero target by 2070, coal is expected to dominate, meeting 68% of demand.
• Renewable Generation:
  • Renewable energy (RE) generation remained relatively stable, with a 21% share of electricity generation in 2023. The rise in solar and wind was largely offset by reduced hydropower output
  • Close to 21 gigawatts (GW) of RE capacity was added during 2023, with RE accounting for nearly 44% of total installed capacity in 2023.
• Electricity Demand Dynamics:
  • India's electricity demand rose by 7% in 2023, driven by rapid economic growth and increased space cooling needs.
  • Expected annual average growth of 6.5% between 2024 and 2026.
  • India's electricity demand is projected to outpace China's by 2026, with the world's fastest growth rate.
• Global Comparison and Emerging Economies:
  • China holds the largest volume of expected growth, India’s electricity demand in the three years might nearly be equivalent to the United Kingdom’s.
  • Developed economies reported substantial reductions in manufacturing and industrial output, and high inflation.
    • About 85% of new electricity capacity is expected from emerging economies, particularly in South Asia, with China and India in the lead.
• Hydropower Challenges and Mandates:
  • Changing weather patterns led to a 15% fall in hydropower generation in 2023.
    • To ensure uninterrupted power supply, the government mandated a blending of a minimum of 6% of imported coal with domestic coal until March 2024.
• Diversification Efforts:
  • Besides adding wind and solar power capacity, large hydro and nuclear power projects are being developed in the country.
• Nuclear Power Surge:
  • More than half of the nuclear power plants in the pipeline globally (between 2024-2026) are in China and India.
    • IEA forecasts global nuclear generation will be almost 10% higher in 2026, compared to 2023.
  • India announced plans in 2022 to triple its nuclear capacity by 2032, aiming to add 13 GW, with 6 GW currently under construction.
    • India currently has 23 operable nuclear reactors providing about 2% of the country’s electricity.
    • Report highlighted that the largest domestically built nuclear power plant, the 700 MWe Kakrapar Unit 3 reactor, commenced operations in Gujarat in June 2023 and reached full capacity in August 2023.
  • Based on the country’s project timeline, Nuclear power generation is expected to increase rapidly during 2024-2026, with new plants totalling an estimated 4 GW of capacity entering commercial operation”.
• Global Nuclear Landscape:
  • According to the World Nuclear Association estimates as of November 2023, 68 GW of nuclear capacity is under construction, 9 GW is currently planned and 353 GW is proposed.
  • Asia is expected to surpass North America's nuclear power growth by 2026, reaching a 30% share of global nuclear generation.
• Small Modular Reactor (SMR) Technology:
  • The report highlighted that momentum is growing behind small modular reactor (SMR) technology.
    • SMRs are advanced nuclear reactors that have a power capacity of up to 300 MW(e) per unit, which is about one-third of the generating capacity of traditional nuclear power reactors.
    • SMRs, which can produce a large amount of low-carbon electricity, are:
      • Small: physically a fraction of the size of a conventional nuclear power reactor.
      • Modular: making it possible for systems and components to be factory-assembled and transported as a unit to a location for installation.
      • Reactors: harnessing nuclear fission to generate heat to produce energy.
    • The SMR Technology development and deployment are progressing, but not without challenges. R&D is starting to accelerate.

What is the International Energy Agency (IEA)?

• About:
  • The IEA was created in 1974 by member countries of the Organisation for Economic Co-operation and Development (OECD) to help industrialized countries respond to major 1973-1974 oil crisis.
    • Since then, its work has expanded to cover energy security, economic development, and clean energy.
  • The IEA is an autonomous forum that provides analysis, data, and policy recommendations to help countries provide secure and sustainable energy.
  • The IEA has four main areas of focus: energy security, economic development, environmental awareness and engagement worldwide.
  • Headquartered in Paris, France.
• Members:
  • The IEA family is made up of 31 member countries, 13 association countries including India, and 4 accession countries.
    • A candidate country to the IEA must be a member country of the OECD.
• Major Publications:
  • World Energy Outlook reports.
  • India Energy Outlook Report.
  • World Energy Investment Report.
  • The IEA Technology Roadmap and Policy Pathway series.
  • The Annual Energy Efficiency Market Report.
  • The Energy Technology Perspectives.