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Renewable energy capacity worldwide is expected to more than double from 4.1TW in 2025 to 8.4TW by 2031, according to GlobalData. The growth is driven by solar PV deployment, cost deflation, and robust policy support, with China leading the way in wind installations and solar PV capacity. However, the US is seeing slower renewable energy growth due to higher costs, increased volatility, and slower project delivery.
Accelerated Growth Forecasted for Global Renewable Energy Sector
The global renewable energy sector is projected to undergo rapid expansion over the next five years, powered by factors such as the scalable nature of solar PV deployment, sustained cost deflation, and strengthening policy support. Intelligence platform GlobalData predicts a more than twofold increase in world renewable energy installed capacity, from 4.1TW in 2025 to 8.4TW by 2031. This marks an impressive compound annual growth rate (CAGR) of 13%.
Asia-Pacific Region Leads in Wind and Solar PV Installations
GlobalData’s report, “Renewable Energy: Strategic Intelligence,” indicates a record high in global renewable energy capacity in 2025. The Asia–Pacific (APAC) region, with China at the forefront, leads in wind and solar PV installations at 699.5GW and 1,550GW respectively. While renewable investment and capacity additions continue to soar globally, the US is seeing a phase of higher costs, increased volatility, and slower project implementation.
Solar PV and Wind Central to Global Renewables Transition
Rehaan Aleem Shiledar, Power Analyst at GlobalData, emphasizes the primary role of solar PV and wind in the global transition to renewables. In 2025, solar PV took over wind as the leading source of renewable electricity generation. Comparatively, wind output was estimated at 2,770TWh in 2025, slightly lower than 2,800TWh from solar PV.
China’s Rapid Solar PV Deployment
China is rapidly expanding its solar PV deployment, driven by carbon-neutrality goals, widespread investment, and substantial cost reductions making solar one of the cheapest electricity sources. The country accounted for approximately 41% of the global solar PV output last year, generating 1,150TW. The US and India are also seeing increasing solar PV outputs, supported by steep cost reductions and policy supports, such as the US Inflation Reduction Act and India’s solar missions.
Artificial Intelligence: A Catalyst in Renewable Energy
Artificial Intelligence (AI) is growing as a key factor in enhancing efficiency, reliability, and profitability within the renewable energy sector. Given the inherent intermittency of wind and solar generation, AI proves crucial in managing and interpreting large data streams, thus improving generation forecasting, optimizing storage dispatch, and coordinating smart-grid operations.
Data Centers: A Strategic Driver in Renewable Energy
Data centers are emerging as a significant and expanding influence on the renewable energy landscape, primarily due to the electricity demand associated with AI workloads. This development has led to tech firms partnering with utilities and energy developers to secure renewable energy supply for data-center operations. For instance, Google and NextEra Energy announced a collaboration in December 2025 to develop gigawatt-scale AI data centers powered by clean energy, while Equinix partnered with CleanMax on a 33MW captive renewable power project.
Shifts in Global Renewable Energy Policy
Shiledar concludes that the renewable energy sector is entering a “two-speed” expansion phase following policy shifts under President Donald Trump’s second term. While US federal support is favoring fossil fuels and reducing green incentives, the global transition continues, driven by falling costs, corporate demand, grid economics, and non-US policies. Meanwhile, China’s clean-energy economy is accelerating, with clean energy accounting for over 90% of investment growth in 2025. Consequently, global renewables are increasingly decoupling from US federal policy, leading to a slower rollout in the US, while the rest of the world scales to record investment and capacity additions.
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