Global Electricity Demand and the Pursuit of Sustainable Development Goals

Advancing SDG 7: Affordable and Clean Energy

A recent International Energy Agency (IEA) report indicates that global electricity demand is projected to grow robustly, with increases of 3.3% in 2025 and 3.7% in 2026. This expansion is critical for achieving universal access to modern energy services. The rising demand is driven by several factors essential for economic development and improved living standards, directly aligning with the objectives of SDG 7.

• Industrial applications and manufacturing
• Household appliances and air conditioning
• Expansion of digital infrastructure, including data centres
• Electrification of transport through electric vehicles (EVs)

To meet this growing demand sustainably, the global energy mix is undergoing a significant transformation. In a major step towards achieving clean energy targets, renewables are forecast to surpass coal as the world’s primary source of electricity by 2026 at the latest. This transition is a cornerstone of SDG 7, promoting a shift away from fossil fuels to cleaner, more sustainable alternatives.

Addressing SDG 13: Climate Action through Power Sector Decarbonization

The changing composition of electricity generation is poised to make a substantial contribution to SDG 13 (Climate Action). The report forecasts that carbon dioxide emissions from the power sector will plateau in 2025 and begin a slight decline in 2026. This positive trend is a direct result of the strategic shift towards low-carbon energy sources.

1. Renewable Energy Expansion: Renewables are set to become the largest source of electricity, fundamentally decarbonizing the global power grid.
2. Nuclear Power Growth: Nuclear power output is expected to reach unprecedented levels, bolstered by reactor restarts and new capacity additions, providing a stable, low-carbon baseload power source.
3. Fuel Switching: The continued displacement of coal and oil by natural gas in many regions serves as a transitional step towards lower emissions.

Fostering SDG 9: Industry, Innovation, and Infrastructure

The report underscores the critical need for infrastructure development to support the energy transition, a key component of SDG 9. The rapid expansion of variable renewable energy sources necessitates significant investment in resilient and modern infrastructure to ensure grid stability and energy security.

• Grid Modernization: Enhanced investment in electricity grids is required to manage increased loads and integrate intermittent renewable sources.
• Energy Storage Solutions: Development and deployment of energy storage are essential for balancing supply and demand.
• Demand-Side Flexibility: Innovative regulatory frameworks and market designs are needed to encourage demand response, enhancing system efficiency and affordability.

The growth in data centres and EVs, while driving demand, also represents an opportunity for innovation in energy-efficient technologies and smart grid management, further aligning with the goals of SDG 9.

Regional Disparities and Economic Implications (SDG 8 & SDG 11)

The growth in electricity demand is not uniform, with emerging economies in Asia, particularly China and India, accounting for approximately 60% of the global increase through 2026. This growth is fundamental to achieving SDG 8 (Decent Work and Economic Growth) and SDG 11 (Sustainable Cities and Communities) in these regions.

• China: Demand growth is forecast to accelerate to 5.7% in 2026.
• India: Demand growth is projected to reach 6.6% in 2026.
• United States: Growth is expected to remain above 2%, largely due to the expansion of data centres.
• European Union: A more modest growth of around 1% is anticipated for this year.

However, the report highlights challenges related to energy affordability. Rising wholesale electricity prices in the EU and US, driven by natural gas markets, pose risks to the competitiveness of energy-intensive industries and impact household energy costs. These price disparities underscore the importance of ensuring that the energy transition is just and equitable, safeguarding economic stability and protecting vulnerable populations as outlined in SDG 7 and SDG 8.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

The article on global electricity demand and generation connects to several Sustainable Development Goals (SDGs) by discussing the transition in energy sources, economic growth, industrial needs, and environmental impacts.

• SDG 7: Affordable and Clean Energy: The core theme of the article is the global electricity supply and demand. It directly discusses the shift towards cleaner energy sources like renewables and nuclear power, while also touching upon the affordability of electricity with mentions of rising wholesale prices in the EU and the US.
• SDG 8: Decent Work and Economic Growth: The article explicitly links electricity demand to economic activity. It states that demand is rising due to industrial use and highlights how emerging economies like China and India are driving “60 per cent of the increase in global electricity consumption,” which is tied to their economic expansion.
• SDG 9: Industry, Innovation, and Infrastructure: The text points to the increasing demand for electricity to “power factories,” “operate growing fleets of data centres,” and “run electric vehicles.” It also emphasizes the need for “greater investment in grids, storage and other sources of flexibility,” which is a direct call for improving energy infrastructure to support industrial and technological growth.
• SDG 13: Climate Action: The article addresses climate change mitigation by analyzing the impact of the changing energy mix on carbon emissions. It forecasts that as a result of the growth in renewables and nuclear power, “carbon dioxide emissions from electricity generation are currently forecast to plateau in 2025 and record a slight decline in 2026.”

2. What specific targets under those SDGs can be identified based on the article’s content?

Based on the article’s discussion, several specific SDG targets can be identified:

1. Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix.
   • The article directly supports this target by stating, “Renewables are expected to overtake coal as the world’s largest source of electricity as early as 2025 or by 2026 at the latest.” This highlights a significant increase in the share of renewable energy in the global electricity sector.
2. Target 7.a: By 2030, enhance international cooperation to facilitate access to clean energy research and technology… and promote investment in energy infrastructure and clean energy technology.
   • The article points to the necessity of infrastructure investment to support the energy transition, noting that the expansion of renewables “must be matched by greater investment in grids, storage and other sources of flexibility to ensure power systems can meet the growing demand securely and affordably.”
3. Target 9.4: By 2030, upgrade infrastructure and retrofit industries to make them sustainable… with greater adoption of clean and environmentally sound technologies and industrial processes.
   • The shift in electricity generation away from coal and towards renewables, nuclear, and natural gas to power factories and data centers reflects an ongoing upgrade of energy infrastructure and a move towards cleaner technologies for industrial use.
4. Target 13.2: Integrate climate change measures into national policies, strategies and planning.
   • The article describes a global trend in the power sector that serves as a key climate change measure. The forecast that “carbon dioxide emissions from electricity generation are currently forecast to plateau in 2025 and record a slight decline in 2026” is a direct result of the large-scale integration of lower-carbon energy sources, reflecting a de facto implementation of climate strategies.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

The article provides several quantitative and qualitative indicators that can be used to measure progress towards the identified targets:

• Indicator for Target 7.2: The primary indicator is the changing share of energy sources in electricity generation. The article provides a key milestone: the point at which renewables will overtake coal as the largest source of electricity (“as early as 2025 or by 2026”). This serves as a direct measure of the increasing share of renewable energy.
• Indicator for Target 8.1 (Sustain per capita economic growth): The article uses projected electricity demand growth as a proxy indicator for economic activity. Specific figures are provided, such as the forecast for demand growth to accelerate to “5.7 per cent in China and 6.6 per cent in India next year,” linking energy consumption directly to economic expansion.
• Indicator for Target 9.4: The growth in electricity consumption from specific innovative and industrial sectors serves as an implied indicator. The article mentions the “rapid expansion of data centres” in the United States and the growing demand from “electric vehicles” as key drivers, signaling the adoption of new technologies that require upgraded infrastructure.
• Indicator for Target 13.2: A direct indicator for measuring the impact of climate action in the electricity sector is the level of CO2 emissions. The article provides a specific forecast: “carbon dioxide emissions from electricity generation are currently forecast to plateau in 2025 and record a slight decline in 2026.” This trend is a measurable outcome of the shift to cleaner energy.

4. Create a table with three columns titled ‘SDGs, Targets and Indicators” to present the findings from analyzing the article.

Source: energi.media