Commodities
Global Growth in Energy Demand Slows in 2025, Electricity Excepted; Renewables Displace Coal: IEA
Demand growth for energy grew at a slower pace in 2025 than the year before, the IEA said in a new report published on Monday, noting that electricity was a clear exception.Solar PV was the largest single contributor to growth in global energy supply for the first time ever, it said.The IEA's Global Energy Review gives a snapshot of energy demand, electricity generation and use, energy technology deployment and a profile of carbon dioxide emissions from energy production.Overall demand growth for energy worldwide was 1.3% in 2025, down from the 1.4% average over the previous decade and much slower than 2025, with slower economic growth and less extreme weather in places plus more uptake of energy-efficient appliances.Global electricity demand grew 3% with the source of that demand spread across buildings and industry as well as electric vehicles and data centers.Solar PV accounted for 25% of the increase in energy supply in 2025 while natural gas accounted for 17%. Renewables and nuclear combined met almost 60% of new energy demand, the report said.Demand for crude oil grew 0.7% as the IEA had forecast, a level constrained by more uptake of electric vehicles, with EVs achieving a 20% increase in sales in 2025 to more than 20 million units, or one in four new cars worldwide.Renewables displaced some coal-fired generation in China but coal demand increased in the US due to higher natural gas prices which led to some switching to the solid fuel for power generation. While there was growth in global coal demand in 2025, it showed a slowdown."Global energy demand continued to increase in 2025 against a complex economic and geopolitical backdrop, with one trend unmistakeable: the expanding electrification of economies," said IEA Executive Director Fatih Birol."In today's rapidly shifting landscape, countries that prioritise resilience and diversification will be best placed to manage volatility and deliver secure and affordable energy in the years ahead."The US stood out with demand for energy in 2025 growing at the second-fastest rate this century, excluding post-recession recovery years, with power demand from data centres a key driver along with robust industrial output and a cold winter.While China accounted for the largest overall share of global energy demand growth in 2025, that still marked a slowdown to 1.7% as more efficient renewables displaced coal.Energy-related CO2 emissions growth slowed, rising by 0.4%, the report noted. China's emissions fell due to a surge in renewables while India's CO2 emissions flatlined for the first time since the 1970s when the Covid pandemic is excluded from data.Advanced economies, generally further ahead in renewables deployment, actually contributed more to emissions growth at 0.5% than emerging and developing economies at 0.3%, the report said, a trend not seen since the 1990s.Solar PV additions globally reached 600 terrawatt-hours in 2025, the largest increase for any source of electricity generation ever seen in a single year, directly reducing coal's share in power production.Similarly, the addition of 110 gigawatts of new battery energy storage capacity was more than the biggest year ever for additions of gas-fired generation capacity.Construction began in 2025 on 12 gigawatts of nuclear power capacity, the report noted, amid a revival of the technology in some regions.Strikingly, the installation of low-emissions technologies since 2019 has avoided the annual fossil fuel consumption equivalent to all energy demand in Latin America, the report said.