Renewable energy is expected to overtake coal as the world’s top source of electricity by the end of next year, as the fossil fuel declines to less than a third of global generation for the first time in a century, according to a new report from the International Energy Agency.
The reasons for the shift include a decline in coal use in China and increased use of renewables to quickly meet demand for artificial intelligence. In the U.S., wind and solar power are expected to surge this year ahead of tax credits either phasing out or being subject to new restrictions in January limiting use of components from China, Russia and other “foreign entities of concern” under the megalaw signed by President Donald Trump on July 4.
“The strong expansion of renewables and nuclear is steadily reshaping electricity markets in many regions. But this must be matched by greater investment in grids, storage and other sources of flexibility to ensure power systems can meet the growing demand securely and affordably,” Keisuke Sadamori, IEA’s director of energy markets and security, said in a statement.
The findings highlight how the energy sector is changing because of artificial intelligence and government incentives and signal that the United States is diverting from China and other major economies with the trajectory of its electricity mix.
