World's Top Energy Authority Admits EV Sales Dented Oil Demand Last Year, But Emissions Rose Anyway Due To 'Exceptional' Shortfall From Climate Crisis

The International Energy Agency (IEA) disclosed that the sale of electric vehicles, which accounted for one-fifth of all new cars sold worldwide last year, resulted in a notable reduction in oil demand.

What Happened: The IEA’s report states that without EVs, solar, wind, and nuclear energy, global emissions over the past five years would have tripled, Electrek reported. The report is part of the IEA’s annual update on global energy-related CO2 emissions and the first edition of the Clean Energy Market Monitor.

Even though energy-related emissions increased in 2023, the rise was less significant than in 2022 due to the expansion of clean energy technologies. Emissions increased by 410 million tonnes, or 1.1%, in 2023, reaching a record 37.4 billion tonnes.

Severe droughts in the U.S., China, and other economies led to a significant decrease in hydropower, accounting for over 40% of the rise in emissions in 2023. To make up for the “exceptional” shortfall, countries turned to fossil fuels. However, without the drop in hydropower, global emissions from electricity generation would have decreased in 2023.

See Also: Best Renewable Energy Stocks Right Now

Brighter Picture? Advanced economies experienced a record drop in emissions in 2023, despite GDP growth. This decrease was due to increased renewables deployment, coal-to-gas switching, energy efficiency improvements, and a decline in industrial production, according to the IEA.

The growth in clean energy between 2019 and 2023 was twice that of fossil fuels. The deployment of wind and solar in electricity systems worldwide since 2019 has significantly curtailed the demand for fossil fuels.

The increase in EVs on the roads significantly prevented oil demand from exceeding pre-pandemic levels. “The clean energy transition has undergone a series of stress tests in the last five years – and it has demonstrated its resilience,” said IEA executive director Fatih Birol.

Why It Matters: In June 2023, the IEA predicted a peak in global oil demand by 2028, attributing this to the rise of EVs. Fatih Birol, the IEA’s director, emphasized the need for oil producers to adapt to the accelerating clean energy transition.

Despite the growth of EVs, the U.S. continues to face a “dirty grid” problem, with 60% of its electrical power still derived from non-renewable fossil fuels. However, the increasing adoption of solar power is expected to help address this issue.

Read Next: ‘That Is What Surprises People Most,’ Says Elon Musk After New Owner Says His Chunky Steel Cybertruck More Comfortable Than Model S

Photo via Shutterstock