Covid-19 Accelerating Energy Transition, Study Suggests

European power markets moving more quickly from coal

Coal-based power generation fell 25.5% across the European Union (EU) and United Kingdom (UK) in the first three months of 2020 compared to 2019, in large part because of the response to Covid-19, according to new analysis by Wärtsilä.

The impact was even more severe in the past month, with coal generation collapsing by almost one-third (29%) between March 10 and April 10, compared to the same period in 2019, making up only 12% of total EU and UK generation. By contrast, renewables delivered almost half (46%) of generation – an increase of 8% compared to 2019.

“The figures mark a dramatic shift in Europe’s energy mix – one that was not anticipated to occur until the end of the decade,” the report states. “The impact of the Covid-19 crisis has effectively accelerated the energy transition in the short-term, providing a unique opportunity to see how energy systems function with far higher levels of renewables.”

The analysis comes from the Wärtsilä Energy Transition Lab, a new free-to-use data platform Wärtsilä said it designed to help the industry, policymakers and the public understand the impact of Covid-19 on European electricity markets and analyze what this means for the future design and operation of its energy systems. The goal is to help accelerate the transition to 100% renewables.

According to the report, total demand for electricity across the continent is down by 10% due to measures taken to combat Covid-19—marking the lowest level since World War II, according to the report. That has led to an unprecedented fall in carbon emissions from the power sector, with emission intensity falling by 19.5% compared to the same March 10 to April 10 period last year.

“The impact of the Covid-19 crisis on European energy systems is extraordinary,” said Björn Ullbro, vice president for Europe & Africa at Wärtsilä Energy Business. “We are seeing levels of renewable electricity that some people believed would cause systems to collapse, yet they haven’t – in fact, they are coping well. The question is, what does this mean for the future?

“What we can see today is how our energy systems cope with much more renewable power-knowledge that will be invaluable to accelerate the energy transition. We are making this new platform freely available to support the energy industry to adapt and use the momentum this tragic crisis has created to deliver a better, cleaner energy system, faster.”

Ullbro said electricity demand across Europe has fallen due to the lockdown measures applied by governments to stop the spread of the coronavirus. However, total renewable generation has remained at pre-crisis levels with low electricity prices, combined with renewables-friendly policy measures, squeezing out fossil fuel power generation, especially coal.

“This sets the scene for the next decade of the energy transition,” he said.

The Europe-wide impacts are mirrored at a national level, for example:

  • In the UK, renewables now have a 43% share of generation (up 10% on the same 10 March to 10 April period in 2019) with coal power down 35% and gas down 24%.
  • Germany has seen the share of renewables reach 60% (up 12%) and coal generation fall 44%, resulting in a fall in the carbon intensity of its electricity of over 30%.
  • Spain currently has 49% renewables with coal power down by 41%.
  • Italy has seen the steepest fall in demand, down 21% so far.

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