The World Energy Outlook 2025,released by the International Energy Agency(IEA)on Wednesday,presents a detailed assessment of global energy trends at a moment of mounting transition pressures.Among its extensive findings,two realities stand out:about 730 million people still live without electricity,even as climate risks intensify.Considered together,these figures expose a defining tension for the global economy-the expansion of electricity supply,now essential to economic inclusion and technological progress,can no longer be pursued in isolation from the imperative to decarbonize power generation.
Electricity has long been a cornerstone of economic development,but its role is now evolving in unexpected ways.As IEA Executive Director Fatih Birol noted,"the increase in electricity consumption is no longer limited to emerging and developing economies.Breakneck demand growth from data centers and AI is helping drive up electricity use in advanced economies,too."
Birol's remarks highlight a structural shift in global demand:the rapid expansion of energy-intensive digital infrastructure in industrialized nations is unfolding alongside persistent access deficits in developing regions.Together,these trends signal an era of rising electricity use.
The more pressing question is how to meet rising electricity demand without worsening the climate crisis.According to the IEA,2024 was the hottest year on record and the first during which global temperatures exceeded 1.5 degrees Celsius above pre-industrial levels.Meeting electricity needs under such conditions requires more than conventional capacity expansion;it demands an accelerated shift toward low-carbon power generation.
The global energy system is undergoing a profound transformation.On the positive side,the share of renewable energy-led by wind and solar power-continues to grow steadily.Yet in some regions and within certain renewable energy industries,development is facing challenges from trade protectionist measures.
In some regions,measures aimed at restricting competition are creating trade and technology barriers that affect the cross-border flow of green energy equipment,investment,and expertise.Geopolitical considerations,together with protectionist trade policies,have emerged as a significant constraint on international cooperation in the development of renewable energy.
Trade protectionism is not a new phenomenon,but the current context calls for careful reassessment,particularly in advanced Western economies.Climate imperatives,combined with the essential role of electricity development in supporting technological progress,make addressing such barriers increasingly important.In this emerging landscape,developed countries need to take a more constructive approach to imports of renewable energy equipment and cross-border investment-channels through which domestic renewable energy industries can be strengthened.
Several developed economies are investing heavily in artificial intelligence(AI),an effort that depends on a stable,multi-layered industrial ecosystem.At the foundation of the AI sector is infrastructure,including data centers and associated computing facilities,which require reliable,low-cost,and increasingly green electricity.The strength of this underlying energy layer is critical:without a well-established renewable power base,the broader AI industry cannot achieve long-term stability or efficiency.
This interdependence shows why developed countries should provide a supportive business environment for the renewable energy sector,fostering competition and investment.Trade barriers that increase costs or restrict development could undermine the reliability and affordability of the electricity that underpins key infrastructure,including AI systems.Allowing green power generation to expand without unnecessary constraints is not only a matter of economic efficiency,but also a prerequisite for sustaining advanced technological industries.
Returning to a global perspective,roughly 730 million people still lack access to electricity,while technological progress continues to drive unprecedented power demand.In this context,a central challenge for the renewable energy sector is not the so-called"overcapacity"cited by some Western politicians,but rather insufficient capacity.
Meeting rising electricity demand while advancing decarbonization will require a more open and efficient business environment at the global level.Facilitating free trade and cross-border investment,promoting competition in renewable energy,and supporting continuous technological innovation can generate stronger synergies between economic growth and climate objectives.Coordinated efforts of this kind are essential to ensure that the expansion of electricity supply aligns with both sustainability and economic development goals.
