World Could Add 12,000 GW of Electricity Capacity Over the Next Decade, IEA Chief Says

The world could add approximately 12,000 gigawatts (GW) of electricity capacity over the next decade, more than twice the amount added during the previous 10 years, according to Fatih Birol, executive director of the International Energy Agency (IEA). Speaking at the COP31 United Nations climate summit in Antalya, Turkey, Birol said electricity is becoming the dominant source of energy as transportation, industrial activity and everyday consumption increasingly shift towards electric power.

The forecast reflects a major transformation in global energy demand, driven by electric vehicles, artificial intelligence data centres and the growing use of air conditioning. Governments are also looking to reduce dependence on imported fossil fuels following disruptions to international energy markets. Birol’s estimate points to a significant expansion of electricity infrastructure, although delivering that growth will require investment in power generation, transmission networks, storage and grid connections.

Global Electricity Capacity Additions Could More Than Double

Birol said the world added approximately 5,000 GW of electricity capacity during the previous decade. He expects the next 10 years to bring around 12,000 GW of additional capacity, more than twice the earlier expansion.

The estimate highlights the scale of investment expected as electricity becomes increasingly important across the global economy.

Period	Electricity capacity additions
Previous decade	Approximately 5,000 GW
Next decade	Approximately 12,000 GW
Expected increase	More than 2 times

Birol described the forecast as conservative, suggesting that the shift towards electricity could continue at a substantial pace even without every proposed government policy being adopted.

The projection also reflects changing patterns of energy consumption. Electricity currently supplies approximately one-quarter of global final energy needs, while fossil fuels account for most of the remaining consumption, particularly in transportation, heating and industrial activities.

As more of these sectors electrify, electricity generation and supporting infrastructure will need to expand significantly.

Three Major Factors Driving Electricity Demand

Birol identified three major forces behind the growing demand for electricity: artificial intelligence and data centres, transportation electrification, and air conditioning.

1. AI data centres and computing infrastructure

The rapid development of artificial intelligence is increasing demand for large computing facilities. AI data centres require substantial amounts of electricity to operate servers, networking equipment, cooling systems and supporting infrastructure.

As companies invest in more powerful AI models and computing capacity, electricity consumption from data centres is expected to become an increasingly important part of power demand.

The growth is not limited to AI training. Data centres also consume electricity when running AI applications, processing information and serving millions of users.

2. Electric vehicles and transportation

The transition from petrol and diesel vehicles to electric transportation is another major contributor.

Birol said electric car sales outside China had increased by 60% over the previous nine months, according to the IEA’s findings. He also highlighted the growing adoption of electric trucks.

As more vehicles use electricity instead of liquid fuels, charging infrastructure and power networks will need to accommodate additional demand.

The transition could also reduce dependence on imported oil, particularly in countries that can generate more electricity domestically.

3. Air conditioning and rising temperatures

Air conditioning could become the largest of the three drivers in terms of electricity demand volume, according to Birol.

Rising temperatures and growing incomes are encouraging households and businesses to install cooling systems. This trend is particularly significant in developing economies, where air-conditioner ownership remains relatively low.

Birol noted that approximately 90% of US households have air conditioning, compared with fewer than 20% in India and around 5% in Nigeria.

As ownership increases in these markets, electricity consumption could rise substantially, particularly during periods of extreme heat.

COP31 Discussions Include a 35% Electrification Target

The electricity transition is also a major subject at COP31, where governments are discussing ways to accelerate the shift away from fossil fuels.

A proposed resolution would aim to derive 35% of global final energy consumption from electricity by 2035.

Governments from 185 countries are participating in the discussions in Antalya. The proposed target is intended to encourage greater electrification across transportation, heating, industry and other sectors.

Birol has supported the initiative, arguing that a clear international commitment could send a strong signal to investors and energy companies about the direction of future demand.

However, the proposal faces political challenges. The Guardian reported that some governments, including Saudi Arabia and Russia, were said to oppose the resolution. COP decisions generally require consensus, meaning disagreement among participating countries could prevent its adoption.

Even if the proposed target is not approved, Birol expects electrification to continue because of the economic and technological forces driving demand.

Renewable Energy Expected to Supply More Electricity

The expansion of electricity demand is also expected to accelerate investment in renewable energy.

Solar and wind power are becoming increasingly important sources of new electricity generation capacity. Their growing role reflects falling technology costs, government support and efforts to reduce exposure to volatile fossil-fuel prices.

The IEA’s Renewables 2026 report projects that global renewable power capacity will increase by almost 4,800 GW between 2026 and 2031. Solar photovoltaic technology is expected to account for more than three-quarters of that expansion.

China is forecast to remain the largest contributor to renewable capacity growth, while India is expected to become the second-largest market.

The IEA also expects renewable capacity additions in emerging and developing economies outside China to match those in advanced economies for the first time during the forecast period.

These developments suggest that the expansion of electricity infrastructure will increasingly involve renewable generation alongside conventional power sources.

Electricity Grids Face a Major Infrastructure Challenge

Adding more electricity generation capacity will not automatically guarantee reliable power supplies. Countries will also need to expand transmission and distribution networks to move electricity from generating facilities to consumers.

The IEA has warned that grid investment has not kept pace with the expansion of renewable energy and electricity demand.

Its recent analysis found that approximately 3,000 GW of advanced-stage renewable energy and storage projects were waiting for grid connections worldwide, following a 60% increase over the previous year.

This creates a significant challenge for governments and energy companies. New solar and wind projects may be ready to supply electricity but cannot begin operating at full capacity until grid infrastructure is available.

Battery storage, flexible electricity demand and improved grid management will also become increasingly important as renewable generation expands.

The IEA has highlighted digital technologies, including artificial intelligence, as potential tools for shifting electricity consumption towards periods when renewable power is more readily available.

The Bigger Picture

The projected addition of 12,000 GW of electricity capacity over the next decade reflects a broader change in the global energy system. Electricity is becoming central to transportation, computing, cooling and industrial activity, rather than remaining primarily a source of power for homes and businesses.

The transition could also reshape international energy markets. Countries that increase domestic renewable generation may become less exposed to imported fossil fuels and sudden price changes. At the same time, the expansion will create demand for grid equipment, batteries, power electronics, transformers and other energy infrastructure.

However, the scale of the forecast also highlights the difficulty of delivering reliable and affordable electricity. Governments will need to coordinate investment in generation, networks and storage while addressing permitting delays, supply-chain constraints and financing requirements.

Looking Ahead

The next decade will test whether electricity infrastructure can expand quickly enough to support growing demand from AI, electric transportation and cooling. The IEA’s renewable energy forecasts suggest that solar and wind will contribute a substantial share of new capacity, but grid investment and storage deployment will be essential to integrating that power reliably.

The proposed COP31 target of sourcing 35% of final energy from electricity by 2035 could provide an additional policy signal if governments reach agreement. Regardless of the outcome, Birol expects electrification to continue as technology adoption, rising cooling demand and energy-security concerns reshape how countries produce and consume energy.