Renewables will expand faster than any other major energy source, with solar PV driving global capacity additions through 2035, according to the IEA’s WEO 2025
Annual solar PV additions average 540 GW to 650 GW in the report’s 2 scenarios, but stronger policy and investment are needed to meet net-zero goals
China remains the largest renewables market and manufacturer, ensuring low technology costs but heightening supply chain dependence
Accelerated repowering of solar panels could boost output, cut costs, and sustain long-term solar market growth, reads the report
Renewables are set to expand faster than any other major energy source in all scenarios in the International Energy Agency’s (IEA) World Energy Outlook 2025 (WEO 2025), with solar PV leading the surge.
Solar PV’s growth is likely to average at around 540 GW annually through 2025, similar to 2024 levels, under its Current Policies Scenario (CPS), which will fall short of what is required to align with global net-zero emissions targets, underlining the need for stronger policy and investment. Both solar PV and wind energy technologies face mounting integration challenges. While US renewable installations are likely to be fewer in 2035, owing to policy changes in the States Policies Scenario (STEPS), the rapid expansion continues at the global level.
This analysis reiterates the IEA’s findings in its recent Renewables 2025 report. In the report, the IEA forecast solar PV to account for around 80% of new capacity additions globally, estimating the capacity as 4.6 TW by 2030, including almost 600 GW in 2025, before dropping to over 500 GW in 2026 (see IEA: Solar PV To Drive 80% Of Renewables Growth By 2030).
Nearly all dispatchable sources of electricity increase to 2035 in the CPS scenario in WEO 2025, with battery storage being the fastest-growing power technology, averaging 90% market growth over the last 5 years. It is expected to add around 135 GW of new capacity annually over the next decade by 2035.
In the Stated Policies Scenario (STEPS) scenario, the world’s renewable energy capacity is expected to triple by 2035, raising its share of global electricity generation from 1/3rd in 2024 to more than half. Solar PV leads the growth, with capacity expected to increase more than fourfold to 2035 and annual additions reaching about 650 GW, followed by strong gains in wind power.
According to WEO 2025, coal currently continues to be the largest power source for the world and will continue to lead for another decade, while nuclear power also gains prominence going forward, even as solar PV and wind power are the most cost-competitive in several regions.
By 2035, about 80% of global energy demand growth will come from regions with strong solar irradiation – a major shift from the past decade when half the growth came from areas with weaker sunlight, point out the analysts. This trend is driving faster solar adoption and higher demand for cooling, especially in Asia, where many new demand centers have coal but rely on imported oil and gas. Most of the electricity demand is expected to be led by India and Indonesia under the CPS; however, there is currently little push for a more electrified energy system.
The report writers believe that accelerated repowering programs and streamlined permitting could further boost solar PV output. Replacing old panels on existing infrastructure can increase energy output cost-effectively. Referring to a 2019 Joel, Woodhouse and Bulović research, the report writers stress, “Replacing solar panels once after 10 to 15 years instead of operating them for 20 to 30 years could reduce the overall LCOE by up to 20% under good conditions.”
They add, “Without increasing the total installed capacity in the projection period to 2050, an accelerated repowering schedule for solar PV power around the world could increase the solar PV panel market size by up to 60% in 2035 compared to the level in the STEPS, and double it by 2040, sustaining continued long-term market growth.”
According to the WEO 2025, China will continue to be the largest renewables market, accounting for 45% to 60% of global deployments over the next 10 years across all scenarios. It will also continue to enjoy the distinction of being the largest manufacturer of most renewable technologies. With its economies of scale and investments in factories abroad, China will keep prices for solar panels and batteries low. Yet, this raises the concern of the country’s continued dominance over solar supply chains, point out the analysts.
The report this year includes only CPS and STEPS as the 2 exploratory scenarios. It does not, however, offer any Announced Pledges Scenario (APS) that has been included since 2021, as several nations are yet to submit their Nationally Determined Contributions (NDC), based on which the APS is assessed.
The complete WEO 2025 report is available for free download on IEA’s website.