The Global Energy Crisis: What’s Happening and What Comes Next in 2025
The global energy industry is undergoing a transformational shift in 2025, driven by a combination of policy changes, technological advancements, and supply-demand fluctuations. While renewable energy continues its expansion, geopolitical conflicts, market reforms, and increasing electricity demand are reshaping the industry’s landscape. Energy prices are set to rise, hydrogen production is evolving, and AI is playing a larger role in energy management. Understanding these shifts is essential for businesses, policymakers, and consumers alike. Here’s a closer look at the key developments shaping the energy sector in 2025 and what they mean for the future.
1. Renewable Energy Growth and Challenges
The global renewable energy sector continues its rapid expansion, with over one-third of the world’s electricity expected to come from renewables in 2025. However, supply chain constraints and policy uncertainty remain key challenges.
Key Developments:
- Asia leads the charge, with China accounting for one-third of global electricity consumption.
- Demand for clean energy outpaces supply, creating a gap that industry leaders are racing to fill.
- New technologies, including AI-driven grid management and carbon monetization strategies, are helping renewables maintain momentum.
While the transition to renewables remains a priority, balancing energy production and consumption sustainably remains challenging.
2. China’s Renewable Energy Expansion
China is making historic progress in renewable energy adoption, surpassing targets well ahead of schedule. Despite a slowdown in installations, the country remains the global leader in new renewable capacity.
Key Developments:
- China is on track to reach its 1,200GW renewable target five years ahead of schedule.
- More than 70% of newly installed capacity in 2025 will come from renewable sources.
- Total installed capacity in China is projected to exceed 3,200GW, far surpassing government targets.
China’s dominance in renewable energy expansion underscores its commitment to reducing reliance on fossil fuels, even as coal consumption continues in parallel.
