According to the latest report from the International Energy Agency (IEA), growth in renewable energy is slowing due to policy changes in the United States and China.
In its Renewables 2025 report, the IEA has lowered its projection for global renewable capacity additions in 2025–2030 by approximately 248 GW, or roughly 5%, compared to its 2024 outlook.
In the US
The IEA expects a 4,600-gigawatt increase in renewable energy by 2030. This is 2.6 times the 2022 level, while the international community had set a target of tripling production two years ago. However, the IEA has now revised its growth forecast for the US downward by almost 50 percent across various renewable technologies.
According to the IEA, solar energy is expected to account for approximately 80 percent of the increase in renewable energy capacity. Low costs and faster permitting procedures will drive this increase.
Key drivers include the earlier-than-expected phase-out of investment and production tax credits for renewables, as well as stricter permitting rules that limit onshore wind and solar installations on federal lands.
The outlook for wind energy, on the contrary, has been revised downward, partly because the Trump administration wants to halt offshore wind energy projects. As a result, wind capacity additions (onshore + offshore) were especially hit — winds are being revised down by up to 60%.
In China
The adjustment is less dramatic in percentage terms, but in absolute GW terms, China’s revision is considerable. China is transitioning from fixed-tariff and guaranteed-price contracts for renewable projects toward competitive auctions. That shift tightens margins and injects more risk into project economics.
Because China is such a dominant player in global renewable energy, even moderate shifts in its policy regime have significant systemic effects.
Implications for climate goals
IEA’s revisions matter because they have implications for global climate goals. Under current policies, we are less likely to meet ambitious targets.
They will also shift regional leadership. With growth cut in the US and tightened in China, other regions gain in relative importance. The IEA expects India, the Middle East & North Africa (MENA), and parts of Southeast Asia to pick up much of the slack.
Sensitivity of the transition
With the increasing adoption of intermittent renewables, there will be a growing emphasis on pumped-storage hydropower, battery storage, demand response, and grid integration. Indeed, the IEA sees accelerated growth in pumped storage and other flexibility options.
The revisions underscore the sensitivity of the transition to government policy. It’s no longer enough that renewables are “cheap” in many places — supportive regulatory frameworks, permitting regimes, incentives, and trade rules still matter a lot.
