IEA Sees 4,800 GW Renewable Capacity Growth by 2031

Global renewable power capacity is projected to increase by nearly 4,800 GW between 2026 and 2031, around 60 percent higher than additions recorded in the previous six-year period, according to the International Energy Agency (IEA). Solar photovoltaic (PV) is expected to account for more than 75 percent of the projected additions, followed by onshore wind.

According to the IEA's Renewables 2026 report, growing concerns over energy security, volatile fossil fuel prices and disruptions to global energy markets are accelerating renewable energy deployment across several regions. The ongoing energy crisis following the outbreak of the Iran war in late February has further strengthened government efforts to reduce dependence on imported fuels and develop domestic energy sources.

For the first time, renewable power capacity additions in emerging and developing economies outside China are expected to match those in advanced economies during the 2026-2031 forecast period, indicating a broader geographical expansion of the renewable energy sector.

China is expected to remain the largest contributor to global renewable capacity additions. However, its share is projected to decline from more than 60 percent in 2025 to an average of 53 percent during the forecast period, partly reflecting changes in its renewable energy policies.

India is projected to become the world's second-largest renewable capacity growth market, with its total renewable power capacity expected to more than double by 2031. Renewable energy expansion is also gaining momentum across Southeast Asia, the Middle East and North Africa, and sub-Saharan Africa.

The IEA forecasts that renewable capacity additions across these regions will almost triple during 2026-2031 compared with the previous six-year period, reflecting stronger policy support and growing interest in domestic power generation.

IEA Executive Director Fatih Birol said that energy security, rather than environmental considerations alone, had become the primary driver of renewable energy expansion as countries seek to reduce their exposure to imported fuels.

He said that renewables currently account for around one-third of global electricity generation and are expected to approach half of total generation over the next five years.

The report also identifies growing consumer adoption of distributed solar power as an important contributor to renewable energy expansion. Households and small businesses are increasingly installing rooftop solar PV systems to manage high fuel prices and address unreliable electricity supplies.

Small-scale solar installations have already helped improve electricity services for around 70 million households worldwide, according to the report. Their relatively quick installation and affordability are supporting wider adoption across markets.

Beyond electricity generation, renewable energy use in the transport sector is also expected to increase. The IEA projects that renewable energy consumption in transport will rise by more than 60 percent by 2031, meeting around 6 percent of the sector's global energy demand.

Renewable electricity consumed by electric vehicles is expected to account for approximately 45 percent of this growth, while biofuels will make the second-largest contribution.

The agency has revised its biofuel growth forecast upwards by 40 percent compared with its previous annual report. The revision reflects increased blending requirements in several countries, particularly in Southeast Asia and Latin America, as governments respond to higher fuel prices and supply constraints by raising the minimum share of biofuels in petrol and diesel.

The report also highlights the importance of diversifying renewable energy supply chains as global demand for solar and wind equipment increases.

India is expected to strengthen its position as an alternative manufacturing centre in the solar PV supply chain. Its share of global solar PV module manufacturing capacity is projected to almost double to 17 percent over the next five years, contributing to efforts to reduce dependence on a concentrated manufacturing base.

However, the IEA cautioned that expanding renewable generation capacity will require corresponding investments in electricity transmission and distribution infrastructure.

The volume of advanced-stage renewable energy and energy storage projects awaiting grid connections worldwide increased by 60 percent over the past year to 3,000 GW. This is four times the wind and solar PV capacity connected to electricity networks globally last year.

The report identifies grid expansion, faster connectivity approvals and improvements in power system flexibility as important requirements for integrating increasing volumes of variable renewable generation.

Battery energy storage systems are expected to play a significant role in addressing these challenges by improving the ability of electricity networks to manage fluctuations in renewable power generation.

The IEA also highlighted demand-side flexibility and digital technologies, including artificial intelligence, as potential tools for improving electricity system efficiency. These technologies can help shift electricity consumption towards periods when solar and wind power generation is higher, allowing greater utilisation of renewable electricity.

The agency said that coordinated investments in grids, battery storage and flexible electricity demand would be necessary to ensure that renewable energy expansion delivers more secure, affordable and reliable power supplies.