Renewables remain the cheapest source of new electricity in most markets and have further strengthened their cost advantage over fossil fuels. New cost data from IRENA, the International Renewable Energy Agency, shows that renewables helped avoid an estimated USD 480 billion in fossil-fuel costs in 2025, protecting users against fuel-price volatility.
So the story so far is a good one - a technological and economic success, for wind and solar especially. With costs falling dramatically, they have both boomed globally and look likely to continue to do so, with wind going offshore and into deeper water, thanks to floating systems, and floating solar PV arrays also spreading on lakes and reservoirs. Agri-solar/solar grazing projects are also getting popular. Projections see solar beating all comers globally in the years ahead.
What about the other renewables? Although so far less developed, new wave and tidal projects also continue to emerge around the world, tidal stream turbines generally having the edge, since it is easier to capture energy from smooth undersea horizontal water flows than from complex/turgid wave interactions between wind and sea at the surface. Hydro is a major well-established renewable resource, with attractive economics, but there are land-use issues and it can have bio-impact issues in some locations. Some say these issues can be dealt with, but there is a debate over new large hydro projects, although pumped storage can make medium to large hydro attractive and smaller run-of-the-river projects are also a valuable option for some sites. The potential of geothermal energy is very large and new drilling technology may make it more economic, but biomass, although potentially a big resource, will probably remain limited by land use issues - PV solar is much more efficient/acre at energy conversion than photosynthesis. Though biomass is storable and biogas production from farm and food wastes has attractions- no new land is needed.
A mixed bag then, with room for major expansion of solar, wind, tidal and possibly wave, but also, for some options, some major eco-limitations. Even so, renewable progress so far is good - with, for example, the UK now getting 52% of its annual power from renewables, Germany around 68%. The EU average in 2025 was 47%. Progress on energy storage is also good too, including long duration storage.
However, the prospects for the wider global energy future are a bit uncertain. IRENA notes in its new transition progress overview, ‘lacklustre improvements in energy efficiency, combined with increasing demand for energy services and electricity across key sectors, are ramping up demand. The evolving infrastructure requirements of modern economies and communities – such as space cooling for data centres – have led to a further increase in electricity consumption. Efficiency improvements alone cannot offset this demand growth; and despite the progress achieved in renewable capacity expansion, the energy system remains ill-prepared to meet global climate targets’.
We have to do better. And it calls triple renewable energy capacity to be tripled and energy efficiency to be doubled by 2030. It sees electrification as one of ‘the most reliable drivers of structural transformation across energy systems. When combined with renewable energy deployment, modern grids, system flexibility and energy efficiency improvements, it can significantly reduce fossil fuel demand across transport, buildings and industry while improving overall system performance’. This it says ‘will require unprecedented investments in renewable power generation, electricity networks, storage, digitalisation and enabling infrastructure. International co-operation will also be critical in enabling faster global electrification, particularly in emerging and developing economies where expanding access and supporting economic development remain essential priorities’.
Specifically, based on its new revised scenario, in order to remain on a 1.5°C-compatible pathway, it says that ‘electricity must account for 35% of global total final energy consumption (TFEC) by 2035 and more than 50% by 2050. Electrification will also foster energy efficiency and will require a global installed renewable power capacity of around 18.4 TW by 2035 and 38.2 TW in 2050’. Under it’s revised 1.5°C Scenario, it says ‘electrification will be highest in buildings (reaching 55% of total final consumption in 2035 and more than 75% by 2050) followed by industry (around 35% in 2035 and more than 40% by 2050) and transport (15% by 2035 and over 45% by 2050)’.
In terms of funding it says that ‘to accommodate this rapid electrification, average annual global investment in grids must rise from USD 0.5 trillion in 2025 to around USD 1 trillion each year in 2026-2035 and USD 1.2 trillion in 2036-2050, to reach USD 29 trillion in cumulative investment. This must be complemented by an equally rapid growth in global installed storage capacity, from 416 GW in 2025 to 2 530 GW in 2035, and 6 859 GW by 2050. Grid expansion must be accompanied by greater demand-side flexibility, with daily flexibility rising from 7% in 2019 to more than 13% by 2035 and 30% by 2050’.
Can and will that all be done? To get to renewables meeting 76% of total global energy by 2050, as in its new primary energy scenario? It won’t be easy and that’s still with IRENA allowing bit of nuclear expansion - to 9% of global primary energy, up from around 5% now. But 76% may be a good goal- and possibly, if we don’t divert money into costly nuclear and fossil CCS, we can even do better than that, as the global ‘100% renewables’ scenarios from, amongst others, Prof. Mark Jacobson at Stanford University and LUT in Finland have suggested. Though it’s still unclear if that is really credible, especially by 2050: it’s a busy area of debate and disagreement.
What should perhaps also be discussed is how thing would have gone if we had all taken action to crank up renewables seriously from the mid 1970s onwards, as some pioneers advocated at the time. Even if we only got started properly in the 1990s, when climate change began to be taken more seriously, we could by now have been more much advanced in dealing with climate change. There’s no more time to waste…
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