Global electricity demand to rise 4% annually until 2027

According to the International Energy Agency (IEA), global electricity demand is projected to grow by 4% each year until 2027, equating to more than Japan’s total consumption. This growth will be primarily offset by the expansion of low-emissions energy sources, such as renewables and nuclear power.

Emerging and developing economies will account for 85% of this demand growth, with China leading the charge. China’s power demand is expected to grow at an average rate of 6% annually through 2027, driven largely by its industrial sector. The demand surge is fueled by the growing electricity-intensive manufacturing of solar panels, batteries, electric vehicles, and related materials. Other key contributors include the rising use of air conditioning, data centres, and the expansion of 5G networks. In 2024, China’s data centres are estimated to consume 100 terawatt hours of electricity.

Keisuke Sadamori, IEA’s director of energy markets and security, highlighted the challenges this growth presents for governments in securing an affordable and sustainable electricity supply. While emerging economies will drive much of the growth, advanced economies are also projected to see rising consumption after a period of stagnation.

India is forecast to account for 10% of the global demand increase, with economic growth and the rising use of air conditioning contributing significantly to the surge. In contrast, the European Union’s demand growth expectations have been revised down to 1.6% in 2025 due to a weaker macroeconomic outlook.

In response to rising demand, low-emissions energy sources are expected to grow in line with global consumption trends, gradually replacing coal in the power mix. Solar power is projected to become the second-largest source of low-emissions energy by 2027, following hydropower. By 2025, renewables are expected to surpass coal-fired generation, marking coal’s share of the power mix dropping below 33% for the first time in a century.