Record Energy Demand, Record Fossil Fuel Use
The 2025 Statistical Review of World Energy, now published by the Energy Institute (EI) after more than seven decades under BP, introduced a new metric: Total Energy Supply (TES). This measure provides a clearer picture of how much sound energy is delivered to society, accounting for the inefficiencies of different energy sources. The findings are striking: global energy demand reached an all-time high in 2024, with every major energy source—coal, oil, gas, renewables, hydro, and nuclear—hitting record consumption levels. Electricity demand grew at a robust 4%, outpacing overall energy growth, driven by the global shift toward electrification.
Renewable energy, particularly wind and solar, experienced significant growth, expanding by 16% in 2024, with China alone accounting for 57% of the new additions. Global solar capacity has nearly doubled in just two years, a testament to plummeting costs and aggressive deployment. Yet, fossil fuel consumption also rose, albeit more modestly, demonstrating that renewables are not yet displacing conventional sources but rather supplementing them to meet soaring demand. Global carbon dioxide emissions climbed by 1% in 2024, marking the fourth consecutive year of record highs. This sobering reality highlights a critical disconnect: while clean energy is growing rapidly, it’s not reducing fossil fuel reliance at the scale needed to curb emissions.
Turley’s Law: The Paradox of Renewable Investment
Why does this happen? Turley’s Law points to several factors. First, renewables like wind and solar are intermittent, requiring backup from reliable sources—often natural gas or coal—when the sun isn’t shining or the wind isn’t blowing. For example, Germany’s aggressive push for renewables has not eliminated its coal plants, which are still needed to stabilize the grid during low renewable output. Second, the global energy demand is growing faster than renewable capacity can keep up, particularly in developing economies like China and India, where coal and oil remain economic lifelines. In 2024, India’s coal demand rose 4%, equaling the combined coal consumption of North America, Europe, and other regions.
David Allen, CFA, Hedge Fund Solutions and Board Director of CFA Society New York, was a guest on the Energy News Beat podcast Conversations in Energy with Stu Turley, and created the term “Turley’s Law” after the podcast. He put all of the parts together in their conversation.
The Numbers Tell the Story
The 2025 Statistical Review provides hard data to back Turley’s Law. Fossil fuels accounted for roughly 80% of the global energy mix in 2024, down only slightly from 82% in 2023 and 84% a decade ago. At this rate of decline, it could take centuries for fossil fuels to lose their dominance. Oil consumption surpassed 100 million barrels per day in 2023 for the first time, with non-OPEC+ producers like the U.S. leading supply growth. Natural gas demand grew by 2.7% in 2024, hitting a new high, particularly in fast-growing Asian markets. Coal, often seen as the dirtiest fossil fuel, saw steady demand, especially in non-OECD countries.
Why the Transition Is “Chaotic”
The Energy Institute describes the energy transition as “chaotic,” a term that captures the structural, economic, and geopolitical barriers at play. Developing economies, which account for four-fifths of global energy demand growth, prioritize affordability and reliability, qualities fossil fuels still provide. Advanced economies, while slowing fossil fuel demand, face challenges in scaling renewables fast enough to replace existing infrastructure. Geopolitical tensions, such as the rerouting of Russian energy flows post-Ukraine invasion, have further entrenched fossil fuel reliance in some regions.
Turley’s Law also highlights a policy paradox. Subsidies and mandates for renewables often coexist with incentives for fossil fuel production, as governments balance climate goals with energy security. For instance, the U.S. has boosted renewable capacity while becoming the world’s top oil and gas producer. Similarly, Europe’s Big Oil companies, like BP and Shell, briefly pivoted to renewables but scaled back when profits lagged, refocusing on oil and gas to reward shareholders.
A Pragmatic Path Forward
The persistence of fossil fuels doesn’t negate the progress of renewables. Solar and wind are now cost-competitive, with 81% of new renewable capacity in 2023 cheaper than fossil fuel alternatives. However, Turley’s Law reminds us that throwing money at renewables without addressing systemic issues—like grid reliability, storage, and fossil fuel dependency in manufacturing—won’t deliver the desired transition. Policymakers must adopt a pragmatic approach, investing in energy storage (e.g., batteries), grid modernization, and nuclear power to complement renewables. Carbon pricing or production caps, as suggested by some studies, could also curb fossil fuel reliance more directly.
