New data from the International Energy Association (IEA) has found that renewable energy capacity will more than double between 2024 and 2030, despite the sector facing significant headwinds in a number of areas including financing, policy shifts, supply chain security, and grid integration challenges.
The latest edition of the IEA’s annual Renewables report finds that global renewable power capacity will increase by 4,600 gigawatts (GW) before 2030, with this roughly equivalent to adding the current combined power capacity of China, the EU, and Japan. This surge will be led by solar PV, expected to account for roughly 80% of new renewables capacity globally. The technology is proving popular due to falling costs, as well as often faster planning and installation timeframes when compared with other energy sources. Whilst solar will lead, it will be followed by wind, hydro, bioenergy and geothermal, with the latter forecast to hit historic highs in key markets, including the United States, Japan, and Indonesia.
“The growth in global renewable capacity in the coming years will be dominated by solar PV – but with wind, hydropower, bioenergy and geothermal all contributing, too,”[i] IEA Executive Director Fatih Birol has said, “Solar PV is on course to account for some 80% of the increase in the world’s renewable capacity over the next five years. In addition to growth in established markets, solar is set to surge in economies such as Saudi Arabia, Pakistan and several Southeast Asian countries. As renewables’ role in electricity systems rises in many countries, policy makers need to play close attention to supply chain security and grid integration challenges.”[ii]
On a regional level, the research finds that emerging economies across Asia, the Middle East and Africa, are seeing faster growth in renewables because of cost competitiveness and stronger policy support, with many governments introducing new auction programmes and raising their targets. In addition, the IEA finds that India is on course to become the second-largest renewables growth market globally, after China. However, overall, the IEA has revised its projections for global renewable capacity growth downwards slightly, when compared with last year’s report- mainly due to policy changes in the United States and in China. The researchers note that the early phase-out of federal tax incentives along with other regulatory changes in the United States has reduced growth expectations for renewables in the US market by almost 50%, compared with forecasts in 2024. Further, China’s shift from fixed tariffs to auctions is impacting project economics, resulting in a reduction in the IEA’s projections for renewables’ growth in the Chinese market.
However, global supply chains for solar PV and rare earth elements used in wind turbines remain heavily concentrated in China, underscoring ongoing risks to supply chain security. The IEA claims that whilst new investment to diversify supply chains is taking place in countries around the world, concentration in China for key production segments is set to remain above 90% through 2030.
ZCA’s latest report Cleantech: Market investment & sector outlook 2025 finds that funding into cleantech companies is up by 15% for the first half of 2025 when compared with the same period last year, driven by investment into the energy segment. This sector alone accounts for 70% of cleantech investment, that is venture investment within the cleantech sector, where ‘investment’ is defined as funding rounds and money raised through private equity[iii].
When looking at investment by region, between 2020 and H1 2025 ZCA finds that the cleantech market has been dominated by North America, where despite recent cuts to the provisions of the Inflation Reduction Act (IRA), these do not yet appear to have significantly impacted investment in the energy, automotive, and battery and storage segments within the US.
For a sample of the research, including a snapshot of the Energy, Battery & Storage representatives listed in ZCA’s Cleantech Top 50, (a showcase of the innovation and disruptive players in the cleantech space) download the free whitepaper: Cleantech Trailblazers ~ Mapping innovation and impact across the green economy.
[i] Global renewable capacity is set to grow strongly, driven by solar PV - News - IEA
[ii] Ibid
[iii] Press release: Cleantech investment breaks new ground in 2025, driven by the energy sector
Lauren has extensive experience as an analyst and market researcher in the digital technology and travel sectors. She has a background in researching and forecasting emerging technologies, with a particular passion for the Videogames and eSports industries. She joined the Critical Information Group as Head of Reports and Market Research at GRC World Forums, and leads the content and data research team at the Zero Carbon Academy. “What drew me to the academy is the opportunity to add content and commentary around sustainability across a wealth of industries and sectors.”
