The IEA in a new report says that electrification could bring the global electricity share closer to the proposed 35% target by 2035
It will be backed by cost-effective technologies such as solar PV, wind and battery storage as these become increasingly competitive
The IEA says grids, storage and system flexibility will need to expand alongside electrification
Faster electrification could help fuel-importing countries cut their energy import bills by around $400 billion a year by 2035, the International Energy Agency (IEA) said in a new report.
Under the report’s High Electrification Scenario, the IEA estimates that fuel-importing countries could cut their energy import bills by about $400 billion a year by 2035. The savings could rise to more than $500 billion when measured against the higher energy prices prevailing in 2026.
The IEA says cost-effective technologies available today, including solar PV and battery storage, together with energy prices at levels seen before the current supply shock, could bring global electrification to around 33%, up from 23% today. This would put the proposed 35% share of electricity in final energy consumption by 2035 within “striking distance.”
The agency adds that higher energy prices amid the Strait of Hormuz crisis could make even more energy consumption cost-effective to electrify.
Notably, the COP31 Presidency has announced the 35-by-35 Global Electrification Pledge, which seeks to raise electricity’s share of global final energy consumption to 35% by 2035. The pledge is intended to support pathways to keep the 1.5°C goal alive and complement efforts to expand renewable energy and improve energy efficiency. However, it does not include any specific renewable energy targets.
Released ahead of COP31 in November 2026, the IEA’s Special Report on Electrification makes the case that electrification can strengthen energy security while supporting affordable and clean energy. The report identifies transport, buildings, industry and agriculture as major areas for electrification in emerging markets and developing economies.
The COP31 President of Negotiations, Chris Bowen of Australia said, “Electrified economies, powered with clean energy, and backed by modern grids and storage, are an enduring answer.”
In the report’s foreword, Bowen said the analysis shows that “we already have the means to deliver an electrified world today,” adding that homes, businesses and communities have substantial cost-effective electrification potential using technologies that are already commercially available. These include solar, batteries, electric vehicles, heat pumps, among others.
Solar PV deployment has increased more than tenfold since 2015, expanding from 56 GW to nearly 630 GW in 2025. To achieve the net zero emissions (NZE) scenario by 2050, the IEA calls for a annual solar PV additions doubling to over 1.2 TW by 2035.
Battery storage capacity will also need to rise almost tenfold to around 2.9 TW by 2035 in the IEA projections from around 300 GW installed at the end of 2025, helping shift electricity across the day. “Together, storage and demand response can support affordable electrification by tapping lower-cost variable renewables and making fuller use of existing infrastructure,” reads the report.
The IEA says falling technology costs have strengthened the competitiveness of solar PV and wind. Since 2010, the levelized cost of electricity (LCOE) has fallen by 90% for solar PV and 70% for wind, while battery storage costs have also dropped by 90% over the past 15 years. It projects a further 40% decline in solar PV costs, 35% in battery costs and 10% in onshore wind costs between 2025 and 2035.
In major markets, solar PV and wind remain among the most competitive power technologies after accounting for their system value and variable output. New solar PV is more competitive than gas or coal in the European Union today and is on a par with new coal-fired power in China, according to the report.
The IEA says combining solar PV with battery storage can increase its value by shifting electricity to periods of higher demand. A hybrid portfolio combining solar, wind and batteries can also increasingly provide electricity at costs comparable with conventional dispatchable power.
The broader message is that falling technology costs are making electrification more cost-effective, but scaling it will require changes across the power system. Faster electrification will require more grids, storage and system flexibility, the IEA says.
The report’s 2050 net-zero emissions pathway also sees a significant expansion of nuclear power, with capacity increasing from around 3 GW today to more than 40 GW by 2035.
Commenting on the report, Janet Milongo, Energy Transition Lead at Climate Action Network (CAN) International said, “The 35-by-35 target will only represent climate progress if it is powered by sustainable renewable energy – and that’s not nuclear or fossil fuels.”
Milongo said the target should not be measured only by the amount of energy that becomes electrified. “We must ask what generates that electricity, who has access to it, who owns the infrastructure, and whether it is helping communities transition away from fossil fuels,” she said.
The complete report is available for free download on the IEA’s website.
