By Mark Jaffe, EUCI energy writer
The largest increase in energy supply in 2025 came from renewables – spurred by solar, according to the 2026 Statistical Review of World Energy. It is the first time renewables have led outside a recession year.
All renewables, including hydro and biofuel, grew by 7% – with solar accounting for three-fourths of the increase – compared to a 1.7% increase in overall energy supplies year-over-year, the review said.
The annual study is issued by the Energy Institute, which is a collaboration between the accounting and consulting firm KPMG, the management consultant Kearney and Ember, an energy think tank.
Solar grew by 30% year-over-year, and its share of global power generation is now close to 9%. Renewables, including hydro, overtook coal as a new power source.
Electricity continues to be the fastest growing energy source, particularly in Asia. Total electricity demand was up 3%, and for the first time, the new demand was completely met by low-carbon sources.
Data centers were a growing driver of electricity demand consuming 788 terawatt-hours, a 20% increase over 2024, with 40% of total demand in the U.S.
By comparison, oil increased by 1.3% and gas was up 1.6%.
“Countries are increasingly shifting to solar electricity round-the-clock, with battery capacity up 66%,” the review said. “Over the past decade, renewable sources have supplied 31% of the growth in total energy supply, similar to gas (34%).”
Regionally, however, there was marked difference in the energy profiles.
“The global energy system is fragmenting – fast,” Wafa Jafri KPMG’s UK lead for energy and natural resources strategy, wrote in a review preface. “For decades, the direction of travel felt broadly shared with a world moving, however unevenly, toward a cleaner and integrated system.”
“That consensus is fracturing and countries are now making fundamentally different choices about how they power their economies, driven by a common imperative: resilience,” Jafri said.
The U.S. has a new focus on its abundant reserves of fossil fuels – oil, natural gas, and coal – even as renewable generation continues to grow.
China is building renewable capacity at “an unprecedent rate” and stockpiling fossil fuels as insurance. It remains the single largest consumer of coal accounting for 52% of global consumption – although demand was flat in 2025.
Europe, while trying to reduce reliance on fossil fuels, is running into resource issues for critical minerals needed for renewables and the need for liquefied natural gas supplies.
Overall, the Asia Pacific remains the major consumer of coal accounting for 83% of world consumption. “The region is particularly exposed to disruption in the Strait of Hormuz,” the report noted.
“For businesses, the implications are clear,” Jafri said. “In an increasingly volatile system, diversified supply, contractual flexibility, and reduced reliance on single sources of crude, gas, refined products and critical minerals are core to competitiveness.”
Fossil fuels remain the largest source of energy accounting for 80% of total energy supply, according to the International Energy Agency.
Global oil consumption was up 1.3% in 2025 to 103 million barrels a day, compared to 2024’s 1.1% increase, the review said.
Oil demand in the 38 advanced economies that are members of the Organization for Economic Co-operation and Development (OECD) dropped to 0.4%. Outside the OECD, demand was up 2%.
Natural gas had the second-largest rise after renewables in 2025, growing by 1.6% year-on-year, but below the 10-year average growth of 1.9%.
India and Europe depended on imported gas to fill half their supply needs. Imports made up a third of China’s supply. The U.S. continued to expand its role as energy exporter with a 27% increase in liquefied natural gas exports.
Coal consumption rose 0.7% globally, but on a regional basis, there were marked differences.
Chinese coal consumption was flat compared to 2024. While India’s consumption was up 0.6%, that was lower than the 3.6% 10-year average.
The U.S., on the other hand, saw 10% growth in coal consumption, thanks to a 50% increase in U.S. natural gas prices. That shifted power plant economics and led to fuel switching to coal.
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