IEA World Energy Outlook: Solar-Led Renewables Grow Faster Than Fossil Fuels Despite US Policy Shift

IEA World Energy Outlook: Renewables Still Accelerating

The International Energy Agency's latest World Energy Outlook (WEO) — a 518-page assessment — finds that renewable energy continues to expand faster than fossil fuels worldwide, led by solar photovoltaics. The report was published amid political tensions after the agency faced criticism from the U.S. administration over its previous oil forecasts.

Multiple scenarios, one clear trend

The WEO presents three scenarios: the Current Policies Scenario (CPS), the Stated Policies Scenario (STEPS) and a Net-Zero-by-2050 pathway. Across all scenarios, renewables grow faster than any other major energy source, though the pace and temperature outcomes differ markedly depending on policy choices.

• Renewables leadership: Solar PV is the fastest-growing source of new generation. China remains the dominant market, accounting for roughly 45–60% of global renewable deployment over the next decade.
• U.S. policy impact: In one pathway, recent U.S. policy shifts lead to about 30% less installed renewables capacity in the United States by 2035 compared with last year’s outlook — yet global renewable deployment continues to expand rapidly.
• Electricity demand drivers: Growth in data centres, artificial intelligence applications and increased air conditioning use are major contributors to rising electricity demand.

Fossil fuels, emissions and warming

Under the IEA's CPS, oil and natural gas demand would rise by about 16% to 2035 and continue to grow toward 2050. In the STEPS pathway, oil demand is projected to peak “around 2030” and fall to roughly 100 million barrels per day by 2035 before declining further. Gas demand is now expected to keep growing into the 2030s, driven in part by policy changes and lower prices.

“The pace varies, but renewables grow faster than any other major energy source in all scenarios, led by solar photovoltaics,” the IEA says.

Crucially, the IEA finds that under every scenario examined the world would exceed the Paris Agreement’s 1.5°C goal unless governments adopt stronger and faster climate policies. Projected long-term warming differs by scenario: in CPS, warming would exceed 2°C around 2050 and reach about 2.9°C by 2100; in STEPS, warming would surpass 2°C by roughly 2060 and reach ~2.5°C by 2100; in the Net-Zero pathway, temperatures would peak near 1.65°C around 2050 and then decline, returning below 1.5°C by 2100.

Politics and process

The IEA reinstated the Current Policies Scenario after removing similar scenarios in 2020, a decision that drew criticism from climate advocates who called the move politically motivated. The IEA’s executive director said the agency received input from many governments and stakeholders and included multiple scenarios to reflect uncertainties and differing views about the energy future.

What this means

Even as renewables — particularly solar — accelerate globally, the IEA’s WEO underscores that technology trends alone will not guarantee climate targets. Policy choices, investments and international cooperation remain decisive: without stronger measures, the world is on a path to exceed 1.5°C of warming.