Core Insights into the Global New Energy Sector in 2025

Executive Summary

In 2025, the global new energy sector is undergoing a profound transformation, marked by unprecedented growth in clean energy capacity, continuous cost reductions, and a potential structural decline in global CO2 emissions. Solar and wind energy continue to dominate new installations, while battery storage and hydrogen technologies are experiencing rapid innovation. The accelerating adoption of electric vehicles worldwide is driving the rapid development of smart charging infrastructure. Despite strong momentum, the new energy sector still faces challenges including supply chain disruptions, geopolitical tensions, the need for grid modernization, and financing gaps in developing economies. Concurrently, emerging demand drivers such as artificial intelligence and data centers present new opportunities.

I. Market and Investment

Total global energy investment is projected to reach a record $3.3 trillion in 2025, with clean energy technologies attracting $2.2 trillion, double the $1.1 trillion invested in fossil fuels.The global renewable energy market is expected to grow from $1.51 trillion in 2024 to $4.86 trillion by 2033.BloombergNEF predicts that 2024 may have been the peak year for global CO2 emissions, suggesting 2025 could be the first year of a structural decline in global CO2 emissions.Notably, under an optimistic scenario, China's total greenhouse gas emissions are projected to peak at 15.8 gigatons in 2025.However, geopolitical and economic uncertainties, particularly supply chain disruptions (cited as the biggest risk by 79% of respondents) and geopolitical issues (78%), along with US tariffs, are causing businesses to hesitate on long-term project investments.

II. Key Technological Progress

• Solar and Wind Energy: In 2025, renewable electricity generation is expected to surpass coal-fired generation for the first time.Global solar PV installed capacity reached 597 GW in 2024, accounting for 81% of new renewable capacity worldwide, and is projected to grow by another 10% to 655 GW in 2025.Solar costs continue to fall, with the global cost of a typical fixed-axis solar farm decreasing by 21% in 2024 and an additional 2% expected in 2025.New solar plants, even without subsidies, are nearing cost competitiveness with new US gas plants.For wind energy, global capacity is expected to increase by approximately 10-15% in 2025, with benchmark costs projected to fall by 4%.Manufacturers like Vestas and Siemens Gamesa are introducing larger, more efficient turbines.Hydropower, as the world's largest source of renewable electricity, plays an indispensable role in grid stability due to its vast existing base and dispatchability.

• Battery Storage: Investment is projected to surge to over $65 billion in 2025.The global benchmark cost for battery storage projects fell by a third in 2024 to $104 per MWh and is expected to drop below $100/MWh in 2025.Technological breakthroughs include high-capacity lithium-ion batteries (e.g., silicon anode technology and LFP), solid-state batteries (commercial deployment expected between 2027 and 2030), sodium-ion batteries (China's CATL has developed commercial products), and water-based batteries.AI-optimized battery management and Virtual Power Plants (VPPs) are emerging, optimizing energy demand forecasting and charge/discharge cycles.

• Hydrogen and Ammonia: 2025 is a crucial year for the development of the low-carbon hydrogen and ammonia industry.The global pink hydrogen (nuclear-powered electrolysis) market is expected to reach $36.86 billion in 2025.The electrolyzer market is projected to grow from $7.6 billion in 2025 to $182.38 billion by 2032.Hydrogen is a promising solution for hard-to-electrify sectors like heavy-duty transport (e.g., freight trucks, buses, rail, and maritime shipping).

• Electric Vehicles (EVs) and Charging Infrastructure: In 2025, EV adoption is accelerating towards the mainstream. Passenger EV sales are projected to increase from 17.2 million in 2024 to 42 million in 2030.The global number of public charge points expanded by 33% in 2024, reaching over 5 million by year-end.Fast and ultra-fast charging infrastructure, smart charging, and Vehicle-to-Grid (V2G) technology, along with the "Charging as a Service" (CaaS) model, are significant industry trends.

• Smart Grids and Digitalization: The smart grid analytics market is estimated to be valued at $8.5 billion in 2025.Software (61.0%) and predictive analytics (38.0%) are leading segments in 2025.AI-driven demand response programs and collaborations between utilities and AI solution providers are driving the large-scale deployment of intelligent grid management systems.

III. Regional Dynamics

• China: China's first Energy Law, effective January 1, 2025, strengthens the legal framework for energy security and transition.In 2024, China installed 329 GW of solar capacity (55% of global additions).By March 2025, China's total wind and solar capacity reached 1,482 GW, surpassing coal for the first time.More than two-thirds of the public charge points added globally in 2024 were in China.

• United States: The federal government supports energy efficiency and clean energy equipment (solar, wind, geothermal, battery storage) through tax credits, which extend until the end of 2025 . Driven by AI, US data center power demand could outpace incremental EV demand in the next five years.However, political headwinds could lead to a rapid withdrawal of federal support .

• Europe: The EU plans to add 89 GW of renewable energy capacity in 2025 (70 GW solar, 19 GW wind) . This expansion aims to reduce reliance on natural gas imports and meet 2030 environmental targets.However, rising costs, supply chain issues, and permitting delays are currently affecting the renewable energy sector.

• India: India aims to achieve 238 GW of renewable capacity by 2025.By the end of 2024, India's installed renewable energy capacity exceeded 200 GW.However, the impending expiration of the inter-state transmission system (ISTS) charge exemption and the stagnation of many awarded projects due to a lack of power supply agreements pose challenges to the sector's growth.

• Emerging Markets: Growing economies in regions like Asia, the Middle East, and Africa present the greatest opportunities for power infrastructure investment.In 2024, Asia accounted for the majority of new renewable capacity additions (72.0%).However, many developing economies, particularly in Africa, face difficulties in mobilizing capital for energy infrastructure, with Africa accounting for only 2% of global clean energy investment.

IV. Challenges and Opportunities

• Main Challenges: Supply chain disruptions (79%) and geopolitical tensions (78%); grid capacity limitations (annual grid investment of $400 billion is not keeping pace with generation and electrification spending, with 750 GW of clean energy projects queued in the UK due to insufficient grid capacity); intermittency of renewable energy and the need for storage; financing gaps in developing economies; and policy obstacles and regulatory complexity.

• Emerging Opportunities: The surge in AI training workloads is driving significant growth in computing power and energy-intensive infrastructure, with data center power demand potentially increasing 6 to 16 times by 2035, which can serve as a strong demand anchor for clean energy projects. The total investment potential for renewables is almost $6 trillion from 2025 to 2035.Green finance is expected to provide increased financial support for renewable energy projects.There is still room for further technological and economic efficiencies in clean power technologies.

Conclusion

2025 is undoubtedly a landmark year in the global energy transition, marking robust growth in clean energy and a potential peak in emissions. However, achieving net-zero emissions targets still requires overcoming significant challenges such as grid modernization, supply chain resilience, and equitable financing for developing countries. The path towards a greener, more sustainable future necessitates sustained investment, coordinated policy efforts, and relentless innovation.