EU power sector emissions fell by a staggering 8% in 2014, whilst electricity consumption fell by 2.7%, which far more than would be expected just from the mild year alone.

This dramatic fall reinforces Sandbag’s prediction that EU electricity consumption will fall by 10% this decade, and that the EU ETS surplus will grow to 4.5 billion by 2020.

The fall in electricity consumption was despite real GDP growth of 1.3%, and adds weight to the idea that the historic link between GDP and electricity consumption no longer exists in the same way.

EU28 electricity generation vs GDP

The graph below shows that EU electricity consumption has already fallen by over 5% since 2010, and virtually every country has seen falls in electricity consumption.

electricity consumption 2014 vs 2010

Sandbag’s analysis (see the full spreadsheet here) for the power sector is based on ENTSO-E, which is not complete, so many manual adjustments were needed.

Large falls in coal generation

Of the reduction in fossil generation, 36% was a fall in gas generation, and 64% was a fall in coal/lignite/oil generation. This is a large turnaround on the previous 3 years, where all the falls in fossil generation were from gas, and coal generation actually increased marginally.

EU fossil generation year on year change

Falling coal generation in 2014 was caused mostly by:

1. Gas generation had already fallen to zero in many hours, so the next fall was naturally on coal (especially in Germany, France, and Italy).

2. The UK carbon floor price (which was £9/tonne last year on top of the EU ETS price) combined with a lower gas price, led to massive coal to gas switching in summer 2014. Gas prices in the continent were similar to UK levels, but without the carbon tax, the low EU ETS price alone was not enough to see switching from coal to gas.

The split by country was:

Coal and gas generation year on year change

Further analysis

Power emissions fell by about 84mt on about 1000mt of power sector emissions. (This does not include heat installations, which constitute about 200mt, and are likely to have fallen by a similar level). There was 84TWh less demand and 30TWh more renewables, which meant about 114TWh less fossil generation was needed.

Other interesting observations are:

  • Renewables generation growth slowed in 2014; it has averaged 53TWh over the previous 3 years.

  • Although electricity consumption fell overall by 2.7%, Austria and the Netherlands bucked the trend with rising consumption.

  • French power emissions have halved in one year, and had virtually no coal generation (although France started from a low base)

  • Spanish emissions rose as CHP subsidies were phased out, leading to an increase in coal generation.

Power the milky way nate2b

'Power the Milky Way' photo by nate2b on Flickr, used under a Creative Commons licence