Context: Recently, the International Energy Agency (IEA) has released a report namely, Global Energy Review:2020 which also includes the impact of the Covid-19 crisis on global energy demand and CO2 emissions.
Key Points

• The imposition of lockdown in several countries has largely restricted transportation such as road and air travel. In turn, the drastic reduction in the global energy demands has been observed.
• The countries in full lockdown are experiencing an average decline of 25% in energy demand per week, while in those with a partial lockdown, the fall in energy demand is about 18% per week.
• Global energy demand declined by 3.8% in the first quarter of 2020 compared to the first quarter of 2019.
• Further, it is expected that the impact of Covid-19 on energy demand in 2020 would be more than seven times larger than the impact of the 2008 financial crisis on global energy demand.

Global demand of various energy sources can be analysed as given below:

• Coal Demand: It has been declined by 8% compared with the first quarter of 2019. The reasons for such decline include, China – a coal-based economy – was the country hardest hit by Covid-19 in the first quarter and cheap gas and continued growth in renewables elsewhere challenged coal.
• Oil Demand: It has declined by 5% in the first quarter, majorly due to curtailment in mobility and aviation, which account for nearly 60% of global oil demand. The report also estimates that the global demand for oil could further drop by 9% on average in 2020, which will return oil consumption to 2012 levels.
• Gas Demand: The impact of the pandemic on gas demand has been moderate, at around 2%, as gas-based economies were not strongly affected in the first quarter of 2020.
• Renewables Energy Resources Demand: It is the only source that has registered a growth in demand, driven by larger installed capacity. Further, the demand for renewables is expected to rise by 1% by 2020 because of low operating costs and preferential access for many power systems.
• Electricity Demand: It has been declined by 20% during periods of full lockdown in several countries. However, the residential demand is outweighed by reductions in commercial and industrial operations.

Covid-19 and CO2 Emissions

• Overall, the emissions decline in 2020 could be 8% lower than in 2019, which would be the lowest level of emissions since 2010.
• It is also the largest level of emission reduction — six times larger than witnessed during the 2009 financial crisis, and twice as large as the combined total of all reductions witnessed since World War II.
• In the first quarter of 2020, the decline in CO2 emissions is more than the fall in global energy demand.

Global Scenario

• In advanced economies, coal demand will fall by 25 percent in the US, 20 percent in the European Union (EU) and 5-10 percent in Korea and Japan. 
• In the coming months, the demand for coal will be impacted based on how its biggest consumers, such as China, recover from the crisis. 
• Renewable sources of energy have been the “most resilient” to Covid-19 lockdown measures and the total global use of renewable energy is expected to rise by 1 percent by 2020. 
• Emissions declined the most in regions which were impacted the highest by the disease. For instance, there was an 8 percent decline in emissions in China and Europe, and a 9 percent decline in the US.

?India’s Energy Demands

• India, which is one of the IEA association countries, has experienced a reduction in its energy demands by 30% as a result of the nation-wide lockdown.
• Moreover, in India, where economic growth and power production are slowing significantly, the demand for coal is expected to decline steeply.
• China and India are the largest and third-largest electricity users in the world respectively, and coal use is dominant in both these countries shaping the global demand for this fuel.

About International Energy Agency (IEA)

• It is an Paris based autonomous intergovernmental organisation. 
• MISSION – To ensure reliable, affordable and clean energy for its  member countries and beyond. 
• Its mission is guided by four main areas of focus: energy security, economic development, environmental awareness and engagement worldwide Headquarters (Secretariat): Paris, France.

Roles and functions

• Established in the wake of the 1973-1974 oil crisis, to help its members respond to major oil supply disruptions, a role it continues to fulfil today.
• IEA’s mandate has expanded over time to include tracking and analyzing global key energy trends, promoting sound energy policy, and fostering multinational energy technology cooperation.

Reports released by IEA

• Global Energy & CO2 Status Report.
• Oil Market Report
• Global Energy Review
• World Energy Outlook.
• World Energy Statistics.
• World Energy Balances.
• Energy Technology Perspectives.

Composition and eligibility

• It has 30 members at present. IEA family also includes eight association countries. A candidate country must be a member country of the OECD. But all OECD members are not IEA members.
• India is its associate member not permanent member.

To become member a candidate country must demonstrate that it has:

• Crude oil and/or product reserves equivalent to 90 days of the previous year’s net imports, to which the government has immediate access (even if it does not own them directly) and could be used to address disruptions to global oil supply.
• A demand restraint programme to reduce national oil consumption by up to 10%.
• Legislation and organisation to operate the Co-ordinated Emergency Response Measures (CERM) on a national basis.
• Legislation and measures to ensure that all oil companies under its jurisdiction report information upon request.
• Measures in place to ensure the capability of contributing its share of an IEA collective action.