Global electricity demand set to grow four per cent annually

Its latest report, Electricity 2025, outlines how electric mobility and industrial electrification are driving demand, alongside increased use of air conditioning and the rapid of growth of data centres, fuelled by the AI boom. According to the IEA, the year-on-year increase in demand will be equivalent to adding Japan’s annual electricity consumption to the global grid each year.

Developing countries account for the lion’s share of growth, making up 85 per cent. China’s electrification is central to this - electricity consumption there rose by seven per cent in 2024 and is expected to grow by an average of around six per cent through 2027. According to the IEA, electricity-intensive manufacturing of solar panels, batteries and electric vehicles are underpinning the leap in demand, as well as air conditioning, EV adoption and data centres.

“The acceleration of global electricity demand highlights the significant changes taking place in energy systems around the world and the approach of a new Age of Electricity,” said IEA director of Energy Markets and Security, Keisuke Sadamori. “But it also presents evolving challenges for governments in ensuring secure, affordable and sustainable electricity supply.