Global Renewable Power Capacity Set to Double by 2030 Despite Supply Chain and Policy Challenges: IEA

Global renewable power capacity is projected to more than double by 2030, according to the International Energy Agency’s (IEA) latest medium-term outlook, as the clean energy sector continues its strong growth despite facing hurdles in supply chains, grid integration, and financing.

The IEA’s “Renewables 2025” report forecasts a 4,600-gigawatt (GW) increase in global renewable power capacity by 2030—equivalent to the combined total generation capacity of China, the European Union, and Japan.

Solar PV Leads Global Expansion

The surge will be dominated by solar photovoltaic (PV) technology, which is expected to account for nearly 80% of total renewable capacity growth over the next five years. The report attributes this momentum to declining costs, faster permitting, and policy support across major and emerging markets. Wind, hydro, bioenergy, and geothermal power will also contribute to the global expansion, with geothermal installations reaching record highs in countries such as the United States, Japan, Indonesia, and several developing economies.

Rising integration challenges are also driving renewed investment in pumped-storage hydropower, which is forecast to grow 80% faster over the next five years compared to the previous period.

Regional Growth and Emerging Markets

In Asia, the Middle East, and Africa, renewables are gaining momentum due to improved cost competitiveness and robust government policies. India is emerging as the second-largest market for renewable growth after China, and is expected to comfortably meet its 2030 clean energy targets.

Despite global optimism, the offshore wind sector faces headwinds, with growth projections 25% lower than last year’s forecast due to policy shifts, cost inflation, and supply chain constraints.

Policy and Market Adjustments

The IEA report notes a slight downward revision in the overall growth outlook compared with last year, mainly due to policy changes in the United States and China. The early phase-out of federal tax incentives in the U.S. and the transition to auction-based systems in China have dampened short-term expansion expectations.

However, this slowdown is partially offset by stronger growth in India, Europe, and emerging economies, driven by new renewable targets, expanded auction volumes, and faster rooftop solar deployment. Corporate power purchase agreements (PPAs), utility contracts, and merchant plants are also gaining momentum, now expected to contribute 30% of global renewable additions—double their share from last year.

Supply Chain and Grid Challenges

While solar PV remains the lowest-cost energy source for new generation worldwide, the report warns that supply chains remain highly concentrated in China, particularly for solar PV modules and rare earth materials used in wind turbines. Despite new investments in diversification, China’s share in key production stages is projected to remain above 90% through 2030.

The rapid growth of variable renewables is also straining electricity systems, leading to curtailments and negative pricing events in several markets. The IEA urges accelerated investments in grid infrastructure, storage, and flexible generation to ensure secure and cost-efficient integration of renewables.

Expanding Role in Transport and Heating

The role of renewables in transport and heating is set to increase modestly. Their share in the transport sector is expected to rise from 4% today to 6% by 2030, mainly driven by electric vehicle (EV) adoption in China and Europe, complemented by biofuel growth in Brazil, Indonesia, and India. In heating, renewables’ share is forecast to climb from 14% to 18% by 2030, supported by clean energy initiatives in industrial and building sectors.

Expert Insights

“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,” said IEA Executive Director Fatih Birol. “As renewables’ share in power systems rises, policymakers must focus on supply chain security and grid integration to sustain progress.”

Despite challenges, the IEA concludes that the resilience of the renewables sector remains strong, signaling confidence from major developers and investors in achieving the world’s energy transition goals by 2030.