Executive summary – Electricity Mid-Year Update 2026 – Analysis - IEA

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Executive summary

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IEA (2026), Electricity Mid-Year Update 2026, IEA, Paris https://www.iea.org/reports/electricity-mid-year-update-2026, Licence: CC BY 4.0

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Global electricity demand growth accelerates as markets navigate energy price shocks

Global power demand is on track to rise faster in 2026 and 2027 than in 2025, even as the Middle East crisis temporarily increases electricity generation costs and as emergency energy conservation measures are implemented in some regions. Electricity demand is forecast to grow by 3.6% in 2026 and accelerate further to 3.8% in 2027, up from 3% in 2025. Structural drivers – including industrial growth; increasing appliance ownership; the accelerating uptake of electric vehicles, air conditioning and heat pumps; and expanding data centre capacity – will continue to support growth in power consumption during the dawn of the Age of Electricity. As a result, global electricity consumption is set to reach 30 700 terawatt hours (TWh) in 2027, up from 28 600 TWh in 2025. Nevertheless, downside risks to the forecast remain amid ongoing military hostilities in the Middle East and broader geopolitical tensions, which could further weigh on the global economy and impact electricity demand.

Notes

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Data for 2026-2027 are forecast values. The plots start from 2019, whereas the x-axis labels are shown only for the odd years due to limited space.

Major economies have so far adapted to the loss of liquefied natural gas (LNG) supplies from the Strait of Hormuz while meeting rising power demand. New gas liquefaction projects, particularly in North America, and higher output from various LNG exporters, have helped ease market tightness. Nevertheless, the temporary loss of nearly 20% of global LNG supply has triggered significant price volatility, pushing natural gas prices in both Asia and Europe to their highest levels since the 2022-2023 energy crisis. The elevated gas prices have, in turn, prompted fuel switching from natural gas to coal in several Asian and European countries, while the continued expansion of power generation from renewables has played a key role in diversifying electricity supplies, thereby supporting energy security and helping limit the impacts of the shock.<br>The world’s largest economies are set to see strong rises in electricity consumption, while higher energy prices and supply disruptions are curbing consumption in some price-sensitive markets. In China, electricity demand growth is expected to accelerate to 5.5% in 2026, from 5.2% in 2025, supported by higher manufacturing activity and increasing EV charging. In India, demand growth is forecast to rebound to 7% this year, up from a subdued 1.6% in 2025, when an early monsoon dampened electricity consumption. In the United States, electricity demand continues its strong upward trend, with consumption forecast to rise by close to 2% this year, led by growing power use from data centres, air conditioning (AC) and industries. In the European Union, demand growth is set to strengthen to 2%, supported by ongoing electrification, as well as colder winter weather in the first quarter and increased cooling needs during heatwaves. By contrast, some emerging economies – particularly Bangladesh and Pakistan, which rely on LNG imports and are much more price-sensitive than many advanced economies – have been acutely affected by the crisis, prompting fuel conservation measures that have curtailed electricity consumption.

Notes

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Data for 2026 and 2027 are forecast values

A stronger-than-expected El Niño event in 2026 could increase global electricity demand further by raising cooling needs in many regions. The El Niño weather pattern also typically affects electricity supply by reducing hydropower and wind generation, especially in regions such as Latin America and Southeast Asia, leading to greater reliance on coal and gas to prevent shortfalls.

Renewables take the lead in power generation

Electricity generation from renewables is set to overtake coal-fired output in 2026, widening their share in the global electricity supply mix. After reaching near parity with coal in 2025, global generation from renewables is forecast to grow by...