Heat, AI help spike global power demand

• IEA's analysis out Friday sees global demand rising 4% in 2024 and again in 2025, compared to 2.5% in 2023.

The intrigue: There's no single reason, and plain old economic growth is an important driver.

• But several huge economies have faced climate change-worsened heat waves in 2024, and this year has been the warmest on record worldwide.
• Heat drives up cooling demand, and AC is growing in places that currently have limited access to these needed systems.

Meanwhile, generative AI is adding to data centers' surging energy needs.

• IEA notes that data centers could account for 3% of global electricity thirst by 2026, up from 1%-1.3% in 2022.
• But the agency acknowledges lots of uncertainty here and says better data is needed.
• EVs, for their part, should account for 1.5%-2% of demand in 2026, up from 0.5% in 2022.

Power generation from renewables is slated to overtake coal next year, IEA projects.

• The world's power mix is getting cleaner, so IEA sees carbon emissions from electricity production "broadly on a plateau" in 2024 and 2025.
• Still, coal-fired power remains "resilient," IEA notes, which is "hindering a decline" in CO2.
• "It's encouraging to see clean energy's share of the electricity mix continuing to rise, but this needs to happen at a much faster rate to meet international energy and climate goals," IEA energy markets and security director Keisuke Sadamori said in a statement.

The bottom line: These flashy emerging sources come atop continued needs of large, traditional energy users, like heavy industry.

• IEA notes, for instance, that aluminum production consumes 4% of the world's electricity.