The rise of electrification: Global consumption to grow by 4% annually until 2027

The world is entering a new era of electricity, driven by an unprecedented surge in energy demand.

According to the report Electricity 2025: Analysis and Forecast to 2027, published by the International Energy Agency (IEA), electricity consumption is set to increase by 4% annually until 2027, with a total rise of 3,500 TWh in just three years.

This growth is driven by the rapid electrification of key sectors, including industry, transport, and buildings, alongside the expansion of data centres and the increased use of air conditioning.

In this context, renewable energy will play a dominant role, covering 95% of the increase in global electricity demand.

The report highlights that 85% of the increase in electricity demand will come from emerging economies, with China and India leading the way.

In China, the projected annual demand growth stands at 6% until 2027, with a steady rise in both industrial and residential consumption.

More than 50% of the global increase in electricity demand will occur in China, primarily due to the manufacturing of solar panels, batteries, and electric vehicles, as well as the expansion of data centres and 5G networks.

India will also play a crucial role in this expansion, with an annual demand growth rate of 6.3%.

The industrial boom and the rise in air conditioning and electric vehicle usage are key factors driving this trend.

In contrast, Africa remains behind in the energy transition, with 600 million people still lacking access to a reliable power supply, highlighting the inequality in global energy development.

The rapid increase in electricity demand is creating new challenges for power grids, which must be modernised to ensure a secure and reliable supply.

In 2024, extreme weather events such as storms, hurricanes, and heat waves caused blackouts in the United States, Australia, and Latin America, exposing the vulnerabilities of the current power infrastructure.

To address this crisis, the IEA stresses the need to expand energy storage capacity and enhance grid flexibility in transmission and distribution networks.

The digitalisation of the electricity sector, alongside demand response strategies, will be key to ensuring system stability.

The rise in electricity demand is not solely linked to residential consumption but is also being driven by the electrification of transport and industry.

In the automotive sector, electric vehicles are gaining ground rapidly.

In China, they now account for 9% of all vehicles on the road, with energy consumption reaching 100 TWh in 2024, a figure that will continue to rise as charging infrastructure expands.

Data centres are emerging as another key factor in demand growth.

Over the next three years, their consumption could double in countries like China, reaching levels as high as 270 TWh. The industry is also undergoing a significant transformation, with the adoption of heat pumps and electric furnaces replacing processes traditionally reliant on fossil fuels.

This shift requires a stronger energy infrastructure and greater investment in clean energy sources.

The energy transition is well underway, with renewable energy set to play a fundamental role in meeting the rising electricity demand.

According to the IEA, 95% of the increase in global electricity consumption until 2027 will be covered by clean energy sources.

Solar power will be the main driver, with an additional 600 TWh per year, equivalent to the total electricity consumption of South Korea. Wind power will also play a crucial role, contributing to one-third of global electricity growth.

Additionally, the revival of nuclear energy will see new plants in China, India, and Europe, boosting generation to record levels.

This development will help to reduce coal dependency, with its share in the global energy mix expected to fall below 33% for the first time in the 21st century.

The world is advancing towards greater electrification, with China and India leading the surge in energy demand.

However, this process also presents significant challenges for power grids, which must adapt to the new realities of consumption and production.

Renewable energy will dominate electricity generation in the coming years, but its successful integration will require massive investments in storage, infrastructure, and digitalisation.

The energy transition is now irreversible and, while demand continues to grow at a rapid pace, the key will be ensuring that the supply remains reliable, accessible, and sustainable.