Renewable Energy Growth in 2025: Progress and Challenges

In 2025, the renewable energy sector made significant strides, with solar power leading the charge and contributing to nearly half of the global electricity capacity. The International Renewable Energy Agency (IRENA) reported that renewables accounted for 85.6% of the global capacity expansion, with solar alone making up nearly three-quarters of these additions. This surge resulted in a record 15.5% increase in installed renewable capacity, reaching 49.4% of the global total. Despite these gains, IRENA warns that the pace is insufficient to meet international commitments, as non-renewable energy sources also saw a sharp increase, particularly in China.

The geopolitical landscape, notably the US-Iran conflict, has underscored the need for energy security, making renewables more appealing. IRENA's Director General, Francesco La Camera, emphasized the resilience of decentralized energy systems that rely on renewables. However, the agency remains cautious, noting that the share of renewable additions decreased from 92% in 2024 to 85.6% in 2025, with non-renewable additions nearly doubling, driven by coal in China and natural gas in the US.

The datacenter and AI sectors have significantly influenced energy trends, with a notable increase in natural gas projects in the US, surpassing China. This growth is attributed to AI datacenter projects and government policies favoring AI development over sustainability. Despite the ambitious goal set at COP28 in 2023 to triple renewable capacity to over 11 TW by 2030, the current pace, with 5.15 TW achieved by the end of 2025, suggests a need for accelerated efforts.

IRENA concludes that significant acceleration is necessary to meet the 2030 target, highlighting the ongoing challenge of balancing renewable expansion with the resurgence of fossil fuels.