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European power demand to grow by a third by 2035
22/11/2023
News
Electric vehicles (EVs), gigafactories, data centres and the buildup of the renewable hydrogen sector will lead to a total power demand growth of 30% in Europe between 2024 and 2035, according to the London Stock Exchange Group (LSEG). Nuclear capacity will fall, coal and lignite will be phased out, and gas generation will remain high.
Sparking the growth in power demand, the report notes that power consumption from EVs is expected to increase to around 170 TWh in 2030, and close to 300 TWh in 2035. Meanwhile, projected electrolyser power consumption for renewable hydrogen production, based on national targets, will reach 200–380 TWh of power consumption in 2030–2035, delivering about 4.2–7.7mn tonnes of hydrogen in 2030–2035.
Nathalie Gerl, Lead Power Analyst, LSEG Power Research, comments: ‘Our forecast is a fascinating look into the future of the European power sector. It shows unprecedented and near-irreversible change as the region comes to terms with new technologies and the need for decarbonisation. The level of change across the region can be put down to significant policy interventions – at a national and supranational level through the European Union.’
By 2035, there will be more nuclear closures in Europe than new starts, according to the report, with nuclear power capacity likely to start picking up in the second half of the 2030s, given the ambitions of France, Sweden, Netherlands, Poland and Czech Republic to build new reactors. The only new nuclear commissioning expected before 2035 are Flamanville 3 (France) in 2024 and Hinkley Point (UK) in 2028. LSEG’s generation forecast declines over time, from 575 TWh in 2024 to 402 TWh in 2035.
Gerl continues: ‘Even though several European countries – most prominently France – have the concrete intention to expand their nuclear fleet (Sweden, Netherlands, Czech Republic) or enter it anew, like Poland, we do not expect that these plans will come to fruition within our forecast horizon.’
She adds: ‘New EPR reactors take more than 10 years to complete, and the market readiness of small modular reactors (SMR) is highly uncertain. There could be SMR commissioning in Europe before 2035, but we don’t expect that in our base case until the ripeness of this technology becomes more evident.’
According to the report, coal and lignite firing will drop drastically, primarily due to the coal phaseout plans which will make Western and Northern Europe coal-free by 2030. For Europe, an 87% drop in coal and lignite firing is expected in 2024–2035.
The reliance on gas for power generation remains high. Coal and nuclear decommissioning will be largely replaced by renewable power, whilst gas-fired power will peak in 2030 above 500 TWh – 18% higher than the estimated 2023 gas generation. Only in the 2030s will gas-to-power start falling gradually, the report finds.
Despite this, there will still be a threefold increase of solar and wind power in Europe in 2035 compared to today. The share of renewables on total power generation increases steadily – 73% renewable power is expected in 2035, and 84% emission-free power (including nuclear). Meanwhile, power sector CO2 emissions are expected to drop by 83% in 2035, compared to 2005 emission levels.
