Global renewable energy installed capacity stood at 4.1TW in 2025. According to GlobalData’s latest “Renewable Energy: Strategic Intelligence” report, that figure is forecast to reach 8.4TW by 2031, a compound annual growth rate of 13% over six years.
The headline number is significant, but the geographic and policy fault lines running beneath it tell a more complex story about where that growth is actually happening and at what cost.
Solar PV is the primary engine of expansion, accounting for 56.1% of total installed renewable capacity in 2025 and, for the first time, surpassing wind as the largest source of renewable electricity generation. GlobalData estimates solar PV output at 2,800TWh last year against wind’s 2,770TWh, a margin narrow enough to qualify as statistical parity but directionally decisive. The cost deflation driving solar deployment shows no sign of reversing, and the technology’s modularity allows capacity additions at a pace and scale that large-scale wind and other generation technologies cannot match.
China’s dominance in both production and deployment is the structural fact that shapes every other number in this market. The country generated 1,150TWh of solar PV output in 2025, roughly 41% of global solar generation, and led APAC’s wind installations at 699.5GW alongside 1,550GW of solar PV capacity across the region. Clean energy drove over 90% of China’s incremental investment growth last year, and renewable manufacturing and installation contributed more than a third of overall economic expansion. These figures reflect not just a policy priority but a vertically integrated industrial strategy that has compressed costs across the entire supply chain, from polysilicon and wafers to inverters and mounting systems.
The US and India represent the next tier, with solar PV output of 486TWh and 189TWh respectively in 2025. Both markets benefit from strong policy frameworks, the US Inflation Reduction Act and India’s national solar missions, but their trajectories are diverging sharply. India’s deployment pipeline is accelerating within a relatively stable policy environment, while the US is entering what GlobalData characterises as a phase of higher costs, increased volatility, and slower project delivery following second-term federal policy shifts under President Trump. Federal support is tilting toward fossil fuels and away from green incentives, a reorientation that is already affecting project economics and financing timelines.
The resulting dynamic is what GlobalData’s power analyst Rehaan Aleem Shiledar describes as a “two-speed” expansion: the US slows while the rest of the world scales. That decoupling matters because it changes the assumption, embedded in much energy transition modelling, that US federal policy is a necessary catalyst for global momentum. The data increasingly suggests otherwise. Corporate procurement commitments, grid economics in non-US markets, and manufacturing cost curves set in China are sustaining investment flows largely independent of Washington’s policy stance.
Intermittency remains the persistent operational constraint on wind and solar at scale, and artificial intelligence is emerging as the primary technical response. Industry participants including Vestas, ENERCON, JinkoSolar, and First Solar are deploying AI across generation forecasting, storage dispatch optimisation, and smart-grid coordination. The practical effect is a reduction in curtailment and operating costs alongside improved grid resilience, though the full system-level impact of AI integration at the scale implied by an 8.4TW renewable base remains difficult to quantify with precision.
AI is also reshaping demand patterns in ways that create both pressure and opportunity for renewable developers. Data centre electricity consumption, driven by AI workloads, is growing rapidly enough that hyperscalers and colocation operators are moving beyond standard renewable energy certificates toward direct investment in generation capacity. Google and NextEra Energy announced a collaboration in December 2025 to develop gigawatt-scale AI data centres powered by clean energy; Equinix partnered with CleanMax on a 33MW captive renewable project. These arrangements lock in long-term offtake at volumes that materially improve project financing conditions, effectively creating a private procurement channel that partially insulates developers from policy volatility.
The 13% CAGR to 2031 implied by GlobalData’s forecast requires sustained execution across grid infrastructure, permitting regimes, and supply chain logistics simultaneously. Transmission bottlenecks in Europe and parts of Asia already constrain the practical realisation of installed capacity, and interconnection queues in the US have lengthened considerably. Whether the doubling of global installed capacity translates into a proportional increase in clean electricity generation depends heavily on how quickly those non-technology constraints are resolved, a question that no cost deflation curve or AI optimisation algorithm can answer on its own.
