Comment on IEA Global Energy Review

Commenting on the Global Energy Review published today by the International Energy Agency (IEA), Richard Black, Director of the Energy and Climate Intelligence Unit (ECIU) said:

“This report provides shocking evidence of the impact that coronavirus is having across the world, including on energy markets. An important question however is how these impacts will relate to real-economy signals in the longer term.

“Coal for example is already in long-term decline in many developed countries, oil basins like the North Sea are mature and approaching the end of their lives, and sectors like US shale are already carrying unsustainable debt levels. All may struggle to emerge intact as the world recovers from the pandemic – but conversely, unlike previous crises like the 2008 financial crash, in the power sector renewables are now the cheapest option and as the report finds, they are squeezing out conventional forms of generation like coal and natural gas even during national lockdowns.

“Another important factor is that in recent weeks there have been robust promises from national leaders and calls from businesses for post-coronavirus stimulus packages to accelerate the clean energy transition. If these pledges come good, and states do develop concrete recovery policies to drive the low-carbon transition, then the crisis could come to be seen as a genuine turning point for world energy markets.”