Global renewable power capacity is projected to increase by 4,600 GW between 2025 and 2030—equivalent to adding the combined generation capacity of China, the European Union, and Japan to the world’s energy infrastructure—according to the International Energy Agency’s latest assessment. This expansion represents a doubling of deployment from the previous five-year period, yet falls 5% below projections issued just twelve months ago, primarily due to policy reversals in the United States and regulatory adjustments in China that have introduced significant market uncertainty.
Solar photovoltaic installations will dominate this growth trajectory, accounting for nearly 80% of new renewable capacity additions through 2030. The technology’s expansion reflects continued cost competitiveness, with module prices declining more than 45% year-on-year in 2024 to reach USD 0.09/W globally—a level below production costs for most manufacturers. This price compression stems from manufacturing overcapacity concentrated in China, where supply capacity exceeds annual deployment by more than 100%. Wind power additions are expected to increase 45% compared to the 2019-2024 period, reaching 732 GW of new onshore capacity despite supply chain pressures and permitting bottlenecks that have constrained offshore wind deployment.
The United States registered the sharpest forecast revision, with projected renewable capacity additions through 2030 reduced by nearly 50% compared to previous estimates. The One Big Beautiful Bill Act accelerated the phase-out of investment and production tax credits, advancing expiration dates that developers had anticipated when structuring project finance models. The legislation requires projects to be commissioned by December 31, 2027, to qualify for tax credits unless construction begins within twelve months of enactment, creating a compressed timeline that eliminates projects unable to meet accelerated milestones. An executive order suspending offshore wind leasing on federal waters and restricting permitting for onshore wind and solar PV projects on federal land further constrains development pathways.
Within the US forecast, wind capacity faces a 57-GW reduction through 2030, affecting both offshore and onshore segments nearly equally. Solar PV projections declined by 140 GW, with distributed residential systems experiencing the most severe impact—a nearly 70% downward revision—as residential tax credits expire at the end of 2025, well ahead of commercial and utility-scale credit termination dates. The early elimination of residential incentives removes the economic rationale for homeowner adoption in markets where retail electricity prices have declined from energy crisis peaks, reducing payback attractiveness.
China’s forecast adjustment, while smaller in percentage terms at 5%, represents the second-largest absolute capacity reduction at 129 GW. The transition from 15-20 year contracts at provincial coal benchmark prices to competitive auctions with contracts-for-difference structures introduces revenue uncertainty that affects project economics. The previous fixed-tariff regime provided developers with guaranteed returns; the new system requires participation in regional wholesale markets where price volatility creates financing challenges. This policy shift prompted a surge in project completions during the first half of 2025, with solar PV additions reaching 93 GW in May—twelve times the May 2024 total—before collapsing 85% to 15.5 GW in June as the fixed-tariff deadline passed.
The forecast anticipates more moderate installation rates in China during the second half of 2025 as developers adapt to auction-based revenue structures. Commercial and industrial solar PV systems face additional constraints, as regulators now require increased self-consumption ratios and mandate that excess generation be sold into wholesale markets rather than receiving fixed compensation. These requirements reduce the economic appeal for commercial building owners who previously relied on predictable revenue streams from surplus power sales.
European Union renewable capacity additions are expected to increase modestly, revised upward by approximately 4% from the previous forecast. Higher-than-anticipated utility-scale solar PV deployment in Germany, Spain, Italy, and Poland offsets a weaker outlook for offshore wind, where project cancellations and auction failures reflect deteriorating economics. Germany’s offshore wind developers opted out of a December 2024 auction for 3 GW of capacity; the United Kingdom cancelled a 2.4-GW project; and the Netherlands reduced and delayed auction volumes by 1 GW. Belgium postponed a 700-MW tender due to cost concerns and supply chain constraints.
The offshore wind forecast globally has been revised downward by more than 25% compared to the previous assessment. Several developers reduced their 2030 deployment targets, with the policy shift in the United States and project delays in Europe, Japan, and India driven by higher costs and supply chain challenges. Offshore wind capacity is now projected to reach 140 GW through the forecast period, more than doubling the previous five-year growth but falling well short of industry projections that underpinned supply chain investments made during 2021-2023.
India’s forecast increased nearly 10%, reflecting record auction capacity awarded in 2024 for onshore wind and utility-scale solar PV, rapid recovery of the onshore wind industry, introduction of a rooftop PV support scheme, and more efficient permitting for pumped-storage hydropower. The country is on track to meet its 2030 target and become the second-largest growth market for renewables globally, with capacity set to rise 2.5 times over five years. India’s expansion is driven by higher auction volumes, new subsidies covering 60% of investment costs for distributed solar systems, and faster hydropower permitting that is tripling pumped-storage capacity by 2030.
The Middle East and North Africa forecast increased 23%, the largest regional upgrade. Saudi Arabia’s deployment acceleration accounts for most of this revision, with 4 GW of utility PV commissioned one year ahead of schedule in early 2025 and 15 GW of bilateral contracts signed during the year. Annual additions for 2025 reached nearly 9 GW—triple the 2024 level—reflecting progress toward the 2030 target of 100-130 GW installed capacity. The kingdom aims for renewables to supply 50% of power generation by 2030, displacing oil consumption that still accounts for 40% of generation amid rising cooling and desalination demand.
Solar PV manufacturing concentration remains above 90% in China for key production segments through 2030 despite diversification efforts. Outside China, module capacity exceeds local deployment by approximately 20% in 2024 and is projected to reach 30% by 2030, yet dependency on Chinese input materials—particularly wafers—is expected to remain largely unchanged. The United States’ new Foreign Entity of Concern restrictions and elevated tariffs could render approximately 90% of global PV module manufacturing capacity outside the United States non-competitive in the US market by 2026. These trade measures favor domestic production but create supply constraints, as only 70 GW of domestic capacity and 180 GW of foreign supply would remain theoretically competitive under the new tariff structure.
Wind turbine manufacturing presents a more geographically diverse picture, though China still accounts for 70-80% of global blade manufacturing, 45-50% of tower production, and around 70% of nacelle assembly capacity. Chinese original equipment manufacturers are expanding rapidly into emerging markets, securing supply contracts in Brazil, Argentina, Australia, Chile, Egypt, and other countries where their 20-40% price discount relative to Western OEMs makes them competitive. The combined size of these non-core markets is set to triple by 2030, surpassing 40 GW of annual wind deployment and providing Chinese manufacturers with outlets for overcapacity as domestic growth decelerates.
Variable renewable energy integration challenges are intensifying as wind and solar shares in global electricity generation approach 30% by 2030—double today’s level. Curtailment rates have been rising in multiple markets: Germany, Brazil, Chile, the United Kingdom, and Ireland all report increasing volumes of constrained renewable generation. China’s curtailment increased roughly 55% in 2024, reaching 4.1% for wind and 3.2% for solar PV, though authorities raised provincial curtailment thresholds from 5% to 10% in high-penetration areas to ease grid congestion and support further expansion.
The number of hours with negative electricity prices has surged across European markets, coinciding with peak solar generation during midday hours. In Germany, negative prices occurred for approximately 460 hours in 2024—double the 2023 figure—while France experienced nearly 350 hours, a twelve-fold increase from the previous year. Spain, which did not allow negative prices until mid-2021, recorded 460 negative-price hours in the first seven months of 2025 alone. These price signals indicate insufficient system flexibility to absorb renewable generation during periods of high output and low demand.
Renewable electricity generation is projected to increase 60% from 9,900 TWh in 2024 to 16,200 TWh by 2030, with renewables surpassing coal as the largest global electricity source by the end of 2025 or mid-2026. Solar PV alone will account for over 60% of the generation increases, followed by wind at 32%. The share of renewables in global electricity generation will rise from 32% in 2024 to 43% by 2030, while variable renewable energy sources will nearly double their share to 28%. This rapid expansion necessitates corresponding investments in grid infrastructure, storage deployment, and demand-side flexibility mechanisms to maintain system reliability as dispatchable thermal generation declines.
The accelerated case scenario indicates that global renewable capacity could reach over 10,400 GW by 2030—bridging most of the gap to the COP28 tripling target of 11,500 GW—if governments address key policy, grid integration, financing, and permitting challenges in the short term. This outcome would require an expansion of nearly 20% above the main case projection. China’s accelerated case shows only 13% higher capacity additions than the main forecast, limited by the pace at which transmission and distribution infrastructure can be expanded and regional wholesale electricity markets can be established. The European Union’s accelerated case demonstrates 30% upside potential, contingent on faster solar PV growth to offset slower-than-expected onshore and offshore wind progress.
Achieving higher deployment trajectories across all regions depends critically on resolving grid connection bottlenecks that currently constrain project development timelines. Renewable energy capacity in connection queues globally totals approximately 1,700 GW in advanced stages of development, with additional early-stage capacity exceeding 1,100 GW. The United States experienced a 23% decline in advanced-stage projects, partly due to ongoing interconnection queue reforms implemented by FERC and partly reflecting development slowdowns from policy uncertainty. Grid operators in multiple jurisdictions are transitioning from first-come-first-served to first-ready-first-served queue management, prioritizing projects that have reached key development milestones.
Financial health challenges persist for equipment manufacturers despite surging global installations. Major solar PV manufacturers in China reported cumulative net losses approaching USD 5 billion since early 2024, with average net margins falling to approximately -10% in the fourth quarter. Oversupply conditions—with manufacturing capacity exceeding deployment by margins that allow for inventory accumulation throughout the supply chain—have compressed margins below production costs for most integrated manufacturers. Wind equipment manufacturers outside China reported cumulative net losses of USD 1.2 billion in 2024, though conditions appear to be stabilizing as macroeconomic pressures ease and companies shift focus toward proven technological solutions rather than price competition.
Renewable energy developers have largely maintained or increased their capacity deployment targets for 2030 despite equipment manufacturer struggles and policy uncertainties. Assessment of large renewables developers shows one-fifth increased deployment goals while three-quarters kept targets at similar levels to the previous year. Corporate power purchase agreements, utility contracts, and merchant plants account for 30% of global renewable capacity expansion through 2030—double the share in the previous forecast—as both developers and buyers benefit from lower solar PV costs. This shift toward market-based procurement mechanisms reflects growing confidence in renewable cost competitiveness even as subsidy support diminishes in key markets.
The renewable transport sector is expanding, with renewable energy consumption projected to increase 50% by 2030, though renewable electricity use for electric vehicles declined nearly 15% from the previous forecast due primarily to reduced US EV adoption. Biofuel demand growth was revised 50% upward, reflecting higher transport fuel demand projections in the United States, Brazil, and Indonesia, and increased biodiesel blending mandates. Global biofuel demand will reach 8% of total transport fuel consumption on a volumetric basis by 2030, with Brazil, Indonesia, and India expanding mandates and fuel consumption simultaneously.
Performance-based standards and GHG thresholds now cover approximately 80% of global biofuel demand, with near-universal coverage in advanced economies. By 2030, these mechanisms are projected to underpin nearly one-third of biofuel demand globally, up from just under 20% in 2024. The United States, Canada, Germany, and Sweden rely on performance-based frameworks as primary policy tools, while France, Spain, the Netherlands, and Romania plan to implement similar systems. The IMO’s proposed Net-Zero Framework for international shipping could generate an additional 0.4 EJ of renewable fuel demand by 2030 if implemented as announced.
Renewable heat consumption is forecast to expand 42% by 2030, reaching 18% of total heat demand globally—up from 14% in 2024—driven by renewable electricity use in industry and buildings and rising bioenergy consumption. Traditional biomass use will decline 26%, with its share falling from 10% to 7% of heat demand. Heat-related CO₂ emissions are expected to increase nearly 0.6 Gt CO₂ to reach 14.6 Gt CO₂ by 2030, stemming almost entirely from the industry sector as industrial heat demand grows 14% while fossil fuels continue to meet the majority of requirements.
The renewable electricity forecast revision reflects a recalibration of near-term deployment expectations against a backdrop of shifting policy landscapes and evolving market conditions. While solar PV cost competitiveness continues to drive adoption and wind deployment maintains upward momentum, the coordination between policy frameworks, grid infrastructure development, and manufacturing supply chains will determine whether the sector can maintain trajectories sufficient to meet climate objectives while navigating trade tensions, financing constraints, and integration challenges inherent in rapid variable renewable penetration increases.
