Electricity's Share of Global Energy Could Double to 50% by 2050 as Fossil Fuels Lose Ground

Electricity's Share of Global Energy Could Double to 50% by 2050 as Fossil Fuels Lose Ground Renewables investment at $2.2 trillion this year is more than double fossil fuel spending, but grid bottlenecks threaten to cap the pace of electrification. Electricity could rise from about 23 percent to over 50 percent of global energy use by 2050, according to a new analysis from Asian Power citing IRENA data. The projection, driven by growing geopolitical tensions, rising energy demand and increasing volatility in fossil fuel markets, represents the most aggressive electrification scenario yet from a major international agency.⁶ That matters because the speed of that transition determines the demand trajectory for every fossil fuel commodity traded today. If electricity doubles its share of final energy consumption over two and a half decades, the displacement of oil in transport, gas in heating and coal in industry accelerates far beyond what current futures curves imply. The investment numbers already reflect the shift. Renewable energy investment is projected to reach $2.2 trillion this year, more than double the spending on fossil fuels, according to IEA data cited by Forbes. That accounts for more than 40 percent of the estimated $3.3 trillion flowing into the global energy sector. Solar power is leading the deployment wave.⁵ The IEA's Electricity 2026 report reinforces the trajectory. Global power demand is set to grow by more than 3 percent per year on average over the rest of this decade, with the share of renewables and nuclear in the world's power mix rising to 50 percent by the end of this decade. Natural gas is also growing within that mix, filling the gap as coal's share erodes. Renewable output will grow by about 1,000 TWh annually through 2030, with solar PV alone accounting for over 600 TWh, the IEA forecasts.¹ A new source of demand is accelerating the pace. AI and data centres alone are projected to account for as much as 4 percent of global electricity use by 2030, according to the IEA. That incremental load is driving urgency for grid modernisation and new capacity buildout that goes beyond what the energy transition alone would require.⁵ In the United States, recent forecasts point to installed solar capacity reaching about 737.8 GW by 2035, up from roughly 231.4 GW in 2024. Total renewable capacity could reach around 1.06 TW by 2035, more than doubling from about 414.5 GW in 2024. Those are staggering numbers, but they assume supply chains hold and grid connections keep pace.³ The coal counter-narrative is weaker than feared. A much-discussed return to coal by some countries in the wake of the Iran war is likely to be far more limited than thought, amounting to a global rise of no more than 1.8 percent in coal power output this year, according to a worst-case analysis by thinktank Ember shared with Carbon Brief. The world will not see a significant return to coal in 2026.² But gas is not going away. The Economist reported that gas will not be killed off by renewables any time soon, pointing to the wide variation in how quickly different markets are displacing gas from the power price-setting stack. In Spain, which has pursued large investments in wind and solar, gas has set power prices only 15 percent of the time so far this year. In Italy, that figure is 89 percent. The gap between those two numbers is a measure of how far most markets still have to travel.⁴ The constraint is not generation but delivery. Grid bottlenecks loom as the binding limit on how fast electrification can proceed. Renewable investment can outstrip fossil fuel spending by any ratio, but if transmission and distribution infrastructure cannot absorb the new capacity, the electrons do not reach the load centres that need them.⁵ Geopolitical risk is pushing the transition faster than economics alone would suggest. Rising fossil fuel price volatility, supply disruptions from the Hormuz closure, and the strategic vulnerability of import dependence are all strengthening the political case for domestic renewable generation and electrification of end uses that currently burn hydrocarbons.⁶ What to watch is whether grid investment scales fast enough to match generation buildout. The IEA's 1,000 TWh annual renewable addition forecast requires transmission capacity that does not yet exist in most markets. If grid bottlenecks persist, the electrification thesis gets delayed, gas retains its price-setting role longer than expected, and the 50 percent target slips to the right.^1,5