‘Golden age’ of gas ending – IEA
Global demand for natural gas is expected to reach its peak as early as 2030, according to the World Energy Outlook 2023 issued by the International Energy Agency (IEA) on Tuesday.
Gas consumption worldwide has increased by an annual average of nearly 2% since 2011. However, growth will slow to less than 0.4% from now until the end of the decade, experts at the Paris-based institution said.
“The Golden Age of Gas is nearing an end,” the outlook proclaims.
According to the report, power and buildings sectors have already seen peaks in natural gas use, with additions for power plants and space heating boilers facing muted demand. These two sectors are ranked among the biggest consumers of natural gas, accounting for 39% and 21% of total demand, respectively. Their reduction in natural gas use is enough to cause overall demand to peak by 2030.
The high point for natural gas power capacity additions was in 2002, when they exceeded 100 gigawatt (GW) and made up around 65% of total annual capacity additions, according to the IEA, which marked the drop at less than 30 GW in 2022.
However, the global installed capacity of natural gas power has continued to expand over time despite the slowing in annual additions, the agency said, explaining that gas in this respect differs from coal, where installed capacity reduces in the future.
“Natural gas demand in the power sector nevertheless declines from today until 2050, with a particularly strong dip in the 2030s, when co-firing in gas-fired power plants begins to be deployed at scale,” the report reads.
The IEA highlighted that, in advanced economies, the rebound in natural gas demand seen in 2021 did not last long, and declined below pre-pandemic levels in the following year.
According to the report, demand will continue to decrease and, by 2030, this will more than offset continued growth in emerging markets and developing economies.
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