Europe & UK

February 8, 2021 Anand Gupta 0

EU Power Sector in 2020

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EU Power Sector in 2020

February 8, 2021 Anand Gupta

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February 8, 2021 Anand Gupta

Landmark moment as EU renewables overtake fossil fuels

Climate neutrality by 2050 means renewables growth will further accelerate

Ember and Agora Energiewende’s fifth annual report tracking Europe’s electricity transition was published on 25th January 2021. It revealed that renewables overtook fossil fuels to become the EU’s main source of electricity for the first time in 2020.

Key findings

This report compiles and analyses the full-year 2020 electricity generation of every EU country, tracking Europe’s electricity transition. This is the fifth year in a row that Ember (formerly as Sandbag) has done this analysis in conjunction with Agora Energiewende.

Renewables rose to generate 38% of Europe’s electricity in 2020 (compared to 34.6% in 2019), for the first time overtaking fossil-fired generation, which fell to 37%. This is an important milestone in Europe’s Clean Energy Transition. At a country level, Germany and Spain (and separately the UK) also achieved this milestone for the first time. The transition from coal to clean is, however, still too slow for reaching 55% greenhouse gas reductions by 2030 and climate neutrality by 2050.

While Covid-19 had an impact in all countries, its impact on the overall trend from fossil fuels to renewables was quite limited. The rise in renewables was reassuringly robust despite the pandemic, and the fall in fossil-fired electricity could have been even more dramatic, had it not been for such a bounce-back in electricity demand and the worst year on record for nuclear generation.

Rising Renewables

Wind and solar are powering Europe’s renewables rise. Wind generation rose 9% in 2020 and solar generation rose 15%. Together they generated a fifth of Europe’s electricity in 2020. Since 2015, wind and solar have supplied all of Europe’s growth in renewables, as bioenergy growth has stalled, and hydro generation remains unchanged.

Renewables rise is still too slow – wind and solar generation growth must nearly triple to reach Europe’s 2030 green deal targets: from 38 TWh per year average growth in 2010-2020 to 100 TWh per year average growth between 2020-2030. It is encouraging that wind and solar increased by 51 terawatt-hours in 2020, well above the 2010-2020 average, despite facing some impact from Covid-19. The IEA forecast record wind and solar capacity growth in 2021. Still, EU countries need to step up their 2030 commitments considerably. At the moment, national energy and climate plans only add up to about 72 TWh new wind and solar per year, not the 100 TWh/year that are needed.

Falling Fossils

Coal generation fell 20% in 2020, and has halved since 2015. Coal generation fell in almost every country, continuing coal’s collapse that was well in place before Covid-19. Half of the drop in 2020 was due to a decrease in electricity demand, which fell by 4% due to the impact of Covid-19; and half was from additional wind and solar. As electricity demand bounces back in 2021, wind and solar will need to rise at a faster rate if the recent falls in coal are to be sustained.

Gas generation fell only 4% in 2020, despite the pandemic. Most of the fall in fossil was on coal rather than gas in 2020, because a robust carbon price meant gas generation was the cheapest form of fossil generation, even undercutting lignite for the first time in some months. Nuclear generation fell by 10% in 2020 – probably the largest fall ever – and that also kept gas (and to a lesser-extent coal) generation from falling further.

This means Europe’s electricity in 2020 was 29% cleaner than in 2015. Carbon intensity has fallen from 317 grams of CO2 per kilowatt-hour in 2015 to 226 grams in 2020. Although coal generation has almost halved in that time, 43% of the coal decline has been offset by increased gas generation, slowing the reduction in carbon intensity. Read More…

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