A new report by the International Energy Agency (IEA) forecasts growing renewables, but also growing fossil fuels in the world’s energy mix under a business-as-usual scenario – a view that has come under fire from global climate and energy experts.
The IEA, an intergovernmental organisation that produces authoritative analyses on global energy markets, said in its World Energy Outlook on Wednesday that renewables will grow faster than any other energy source globally over the next 25 years.
However, its Current Policies Scenario (CPS), which is based on existing energy policies and regulations, projects that demand for oil and gas will grow past 2030. This trend is driven by the United States’ policies favouring gas and more affordable gas prices, said the IEA.
Scientists and policy experts criticised the CPS for being out of step with current energy market trends and global climate priorities.
“The CPS is not representative of reality. It’s not even representative of renewable (energy) markets,” said Rachel Cleetus, senior policy director of the climate and energy programme at the Union of Concerned Scientists, a US-based non-profit focused on climate advocacy.
Speaking to reporters at the COP30 climate conference, she added that the scenario is “entirely politically motivated” by a US administration that has been trying to undermine clean energy policies not only at home, but around the world.
The IEA’s latest report marked an about-turn from the organisation’s multi-year forecast up until 2024, which foresaw demand for coal, oil and gas peaking before 2030. The organisation has been under pressure from the US, one of its biggest funders, to change its tone on the energy transition. US energy secretary Chris Wright earlier this year described the IEA’s “peak oil” forecast as “nonsensical”.
The 2025 report, which forecasts the US as the world’s largest oil and gas producer through to 2050, cited the issue of energy security as the key reason for its new fossil fuel expectations. “Energy is at the heart of today’s geopolitical tensions,” it said.
But Cleetus called this focus on energy security alone a narrow lens that fails to account for the potential economic costs of climate change.
“It’s irrational to imagine scenarios like the CPS, where temperatures go up to 2.9°C – that’s not a world in which any economy can thrive,” she said.
Instead, sophisticated investors should base investment decisions on “real market trends,” said Cleetus. “The good money should bet on where the economy is going, not stuck in the fossil fuel-centred economy of the past.”
Dave Jones, chief analyst of global energy think tank Ember, shared a similar view, as did Maria Pastukhova, programme lead for energy transition at climate think tank E3G. “Scenarios based on current policies and legislation are behind the curve of technology change, as [electrification] gathers pace,” said Jones.
Pastukhova warned that the CPS “points to continued fossil fuel dependence, persistent market volatility, and structurally high energy prices.”
“That may suit a few producing countries, but for economies representing around 90 per cent of [the global economy], it means declining competitiveness and welfare increasingly exposed to the political will of mostly authoritarian petrostates.”
She added that countries which want to protect their consumers and economies from “rollercoaster energy prices” should focus relentlessly on energy efficiency and decarbonising energy demand.
A fossil-fueled Southeast Asia
The IEA report also forecasted that China would continue to be the largest market for renewables, accounting for between 45 per cent to 60 per cent of global deployment over the next decade. But it raised concerns about China’s dominance of solar photovoltaic (PV) and battery storage supply chains.
“In 2024, there was sufficient manufacturing capacity to have produced more than twice as many solar PV modules as were actually deployed, and almost three-times as many battery cells,” it said. “A key question is what happens to surplus capacity in the context of trade barriers, demand-side uncertainties, substantial pressures on technology prices, and falling profit margins for some producers.”
Cleetus said that this analysis set up an “unhelpful frame around zero-sum competition”.
“We will only make this global clean energy transition a reality if there is cooperation across countries in terms of manufacturing and deploying renewable energy as quickly as possible,” she said.
However, the IEA expects India, Indonesia and other Southeast Asian countries to lead global demand for coal, and potentially oil and gas. “Around half of global coal demand is used for electricity generation in these economies, and the outlook for coal depends to a great extent on their needs for electricity, whether the current momentum behind renewables is sustained, and whether gas can be priced competitively enough to make inroads,” the report said.
Despite the forecasts, International climate leaders emphasised the need to continue advancing renewables.
“Some may wish to turn back the clock, but the direction of the energy system is clear,” said Laurence Tubiana, chief executive of the European Climate Foundation and among the architects of the Paris Agreement. “Oil demand is on track to peak before 2030 in the IEA’s main scenario.”
“The choice now is between accelerating [the energy transition] or paying later to undo the damage: every tonne of carbon we avoid today saves far greater costs tomorrow. We can keep looking backwards and burying our heads in the sand – or look forward, clear-eyed, to the future we must build to avoid catastrophe,” she said.
This story was produced as part of the 2025 Climate Change Media Partnership, a journalism fellowship organized by Internews’ Earth Journalism Network and the Stanley Center for Peace and Security.
