On July 30, the International Energy Agency released its "Electricity Mid-Year Update," which showed that despite economic pressures, global electricity demand continues to grow strongly. It is projected to grow by 3.3% in 2025 and 3.7% in 2026, more than double the growth rate of total energy demand during the same periods. While this growth rate slows from the 4.4% increase in 2024, it remains significantly higher than the 2.6% average from 2015 to 2023. This demand growth is primarily driven by electricity consumption in factories and household appliances, building cooling, data center operations, and electric vehicle operations.
Regionally, emerging economies in Asia are driving the growth. China and India will contribute 60% of global electricity consumption growth in 2025 and 2026, with demand growth rates in these two countries expected to accelerate to 5.7% and 6.6%, respectively, in 2026. Due to the rapid expansion of data centers in the United States, electricity demand will grow by more than 2% annually from 2025 to 2026, more than double the average rate of the past decade. Electricity consumption in the European Union will grow by approximately 1% this year, with a slight acceleration expected in 2026.
The report predicts that renewable energy is expected to replace coal as the world's largest electricity source by as early as 2025 and as late as 2026, with the exact timing subject to weather and fuel price trends. Meanwhile, nuclear power output is projected to reach a record high, driven by reactor restarts in Japan, strong growth in nuclear power output in the United States and France, and new nuclear power projects in Asia. Gas-fired power generation is steadily growing, continuously replacing coal and oil in the power sector in many regions.
Due to factors such as energy mix adjustments, CO2 emissions from power generation are expected to stabilize in 2025 and decline slightly in 2026, but weather and economic conditions could affect this trajectory.
