According to the International Energy Agency’s (IEA) Electricity 2025 report, solar power is expected to meet approximately half of the world’s electricity demand growth by 2027.
The agency’s flagship report predicts that due to increasing industrial consumption, air conditioning usage, electrification, and data center demand, global electricity consumption will grow at its fastest rate in recent years, rising by nearly 4% annually through 2027.
The report explains that continuous cost reductions and policy support will drive solar deployment, allowing it to meet half of the additional electricity demand. This forecast surpasses the 40% share solar contributed to global electricity demand growth in 2024. By 2027, low-emission energy sources—including renewables and nuclear power—are expected to meet all of the world’s growing electricity demand.
The IEA report further highlights that in 2024, global solar power generation surpassed the 2,000TWh mark, accounting for 7% of total electricity generation—an increase from 5% in 2023.
This means solar power generation grew by 30% in 2024, marking the highest growth rate since 2017, with an annual increase of 475TWh, a record high. The IEA notes that over half of this growth came from China.
By 2024, solar power generation exceeded coal-fired electricity production in the European Union, surpassing a 10% share in the energy mix. Over the next three years, the IEA forecasts that solar power will also surpass the 10% benchmark in China, the United States, and India.
During the 2025-2027 forecast period, global solar power generation is expected to increase by approximately 1,800TWh. By 2027, this growth will make solar the world’s second-largest low-emission electricity source, second only to hydropower.
Meanwhile, renewable energy sources are expected to collectively surpass coal-fired power this year. For the first time in a century, coal’s share in global electricity generation is projected to fall below one-third.
The report also emphasizes the importance of understanding periods when solar PV output declines due to weather conditions. "While such events may put stress on power systems, having sufficient dispatchable capacity and long-term storage will be essential," the report advises.
Additionally, the report highlights key challenges power systems faced in 2024. The IEA states that events such as winter storms, hurricanes, power outages, and droughts underscore the need to enhance power system resilience.
In some regions, rising wholesale electricity price volatility has led to negative wholesale prices. According to the IEA, these occurrences typically indicate insufficient system flexibility due to technical, regulatory, or contractual constraints, reinforcing the growing need for enhanced grid flexibility.
