Global growth in solar “the largest ever observed for any source”

On Monday, the International Energy Agency released its analysis of the energy trends of 2025, covering the entire globe. It confirms and extends the primary conclusion of a more limited analysis by the International Renewable Energy Agency: 2025 was the first year of solar’s dominance. Increased solar production was a key reason the growth of carbon-free energy sources outpaced rising demand.

Coupled with a massive growth in battery storage and relatively stagnant fossil fuel use, the year has led the IEA to declare that “the world has entered the Age of Electricity.”

Electrons for everyone

The IEA report covers energy use, including the electrical grid, transportation, home heating, and other forms of consumption. As such, it can track how some of those uses are shifting, as electric vehicles displace some gasoline use and heat pumps replace gas and oil heating. It also saw a more global trend: The demand for electricity grew at twice the rate of overall energy demand. All of these went into the conclusion that we’re starting the Age of Electricity.

In terms of specifics, the IEA saw electric vehicle demand rise by nearly 40 percent, with electric car sales being a quarter of the total of cars sold last year. While that’s having a measurable effect on electricity demand, it remains relatively small at the moment. It’s almost certain to be contributing to the size of the rise in oil use last year: 0.7 percent. In absolute terms, that’s less than half the average rise of the previous decade.

The share of each source that was used to meet changes in energy demand vs. 2024. Nearly every source of energy grew, but renewables accounted for over half, with solar dominating.

Credit: IEA

Heat pump sales were largely flat last year, but in a number of countries, past growth has meant that heat pumps now account for a majority of new heating units sold. But relatively cold weather in populated regions of the world made the building sector the primary driver of demand for natural gas. Even so, its use rose only 1 percent in 2025 compared to 2024.

Trends like these are likely to accelerate in 2026 due to the conflicts in the Middle East. The closing of the Strait of Hormuz will severely affect the flow of oil globally, and a number of countries are dependent on liquefied natural gas from Persian Gulf states. Even if non-fossil alternatives were unavailable, we’d see lower consumption due to a combination of reduced availability and higher prices. Instead, we’re more likely to see an accelerated shift away from fossil fuels due to increased interest in electrified alternatives and government efforts to limit the impact of future fuel shocks.

Moving to a solar-dominated grid

When it comes to supplying electrons for those alternatives, the central story is solar power. “The absolute increase of solar PV generation in 2025 is the largest ever observed for any source,” the IEA says, “excluding years marked by rebounds from global economic shocks such as COVID-19.” In other words, with nothing in particular driving the energy markets in 2025, Solar’s growth was unprecedented. On its own, its growth covered a quarter of the rising demand for all forms of energy. If you limit it to electricity, increased solar production covered over two-thirds of the increased demand.

Overall, solar generated over 2,700 terawatt-hours last year, more than double its output from three years earlier. It now accounts for over 8 percent of the world’s total electricity production. Thirty individual countries installed at least a gigawatt of solar last year, and it is now the single largest grid source by capacity (though other sources still outproduce it at the moment).

Change in the production of different electricity sources. Most have barely budged in the past two years, with solar being a big exception.

Credit: IEA

The solar boom is the primary reason that carbon-free generating sources—hydro, nuclear, solar, wind, and other renewables—were able to grow faster than demand in 2025. In other words, as electrification increases, we’re at the point where we are capable of meeting the additional demand without boosting carbon emissions. These sources covered nearly 60 percent of the overall growth in demand for energy of all types.

Solar’s growth is being accompanied by a key enabling technology: batteries. Batteries were the fastest-growing power technology, with capacity additions rising 40 percent between 2024 and 2025, reaching 110 GW of new capacity last year. That is apparently more than the highest one-year addition of natural gas capacity and leaves our total installed capacity at over 10 times what it was just five years ago. Batteries, when combined with cheap solar, can limit the need for fossil fuel-powered backups.

As noted above, natural gas use increased (by about 1 percent), but that was primarily due to weather-driven heating demand. Coal was largely flat, with use rising by just 0.4 percent. While the US saw a small increase in coal use, coal use in the EU dropped below 10 percent of electricity production last year for the first time since statistics were kept. While China commissioned a lot of coal plants in 2025, those were largely started during a prior energy shock. China actually saw its coal use for electricity drop last year due to its massive investment in renewables (China was responsible for 60 percent of renewable global growth last year).