New Delhi: India’s energy demand is expected to increase by 15 exajoules by 2035, making it the “largest source of energy demand growth in the world,” says World Energy Outlook, the International Energy Agency’s flagship report, released on Wednesday.
Going by the IEA’s “stated policies scenario,” India’s demand growth is projected to nearly match that of China and all other Southeast Asian nations combined.
“Energy demand in India is being propelled by increasing economic activity,” says the report, adding that the country also faces a spate of energy-related challenges, including reducing dependence on fossil fuels and ensuring equitable energy access.
Started in the early days of COP30, currently ongoing in Brazil’s Bélém, the World Energy Outlook maps out the current energy landscape. Released this year amid geopolitical churn and shifting global policies, it provides a loose sketch for the way forward.
“When we look at the history of the energy world in recent decades, there is no other time when energy security tensions have applied to so many fuels and technologies at once – a situation that calls for the same spirit and focus that governments showed when they created the IEA after the 1973 oil shock,” said IEA executive director Fatih Birol.
Worryingly, even heavy adoption of renewables might not be enough to contain the damage wrought by climate change.
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Three paths, all hotter
This year’s report uses three frameworks to chart how the world’s energy systems could evolve: the Stated Policy Scenario (STEPS), the Current Policy Scenario (CPS), and the Net Zero by 2050 Scenario.
According to the first outlook, renewable energy generation is set to accelerate, hitting 55 per cent of total energy share by 2035. But, the CPS, which also forecasts the continued growth of renewables, predicts that the speed will be slower –– and the planet will be 3°C warmer by 2100.
The NZE scenario, meanwhile, meets the COP28 goals of doubling efficiency gains and tripling renewables by 2030 but projects higher near-term emissions and warming above 1.5°C for several decades.
“Despite the growth of renewables in both scenarios, neither manages to lower energy-related emissions sufficiently to avoid severe risks from a changing climate,” warns the World Energy Outlook report.
But it’s not all bleak.
While the current scenario is marred by grid integration challenges and limited policy shifts, the report predicts the beginning of the end for coal — demand is projected to decline by the end of this decade, though it isn’t specified by how much.
However, the demand for natural gas, considered a cleaner fossil fuel, is due to last “well into the 2030s” according to STEPS. The CPS reading, meanwhile, sees the demand for natural gas persisting till mid-century.
A Trump cloud?
The World Energy Outlook report has not been without controversy. One issue raising red flags for some energy experts is that the Current Policy Scenario (CPS) has been revived after last being included in 2020.
Critics claim it allows governments to renege on policy pledges, as the CPS assumes only currently enacted laws and regulations remain in force.
“[A]fter pressure from the Trump administration in the US, the IEA has resurrected its ‘current policies scenario’, which effectively assumes that governments around the world abandon their stated intentions and only policies already set in legislation are continued,” argued an article in Carbon Brief.
Earlier this year, Politico reported that the Trump administration was putting pressure on the IEA to backtrack on its research, which underpins the clean energy transition. US officials supposedly “pushed the body, which publishes influential energy market forecasts, to cease its work promoting the global shift to clean power and net-zero carbon emissions.”
The WEO also highlights that this year, the US passed the One Big Beautiful Act (OBBBA), “signalling a renewed emphasis on domestic energy production — notably coal, nuclear, geothermal, oil and natural gas” in addition to the development of more energy infrastructure.
As of now, according to the report, the US is the second-highest producer of electricity in the world. It generates half as much as China but more than twice as much as India, which comes in at a distant third. Last year, the US accounted for 20 per cent of global oil demand.
Critical minerals crunch
The WEO places critical minerals front and centre. While noting that diversification is essential to energy security, the report says that the supply of critical minerals — needed for power grids, batteries, EVs, AI infrastructure, and defence systems — is “becoming increasingly concentrated in a few countries.”
This is underscored by the IEA’s analysis, according to which the diversification of supply systems is “set to be slow.”
“By 2035, the average share of the top-three refined material suppliers is projected to decline only slightly to 82 per cent, effectively returning to the concentration levels seen in 2020,” states the report. The IEA finds that for 19 of 20 energy-related strategic minerals, China comes out on top as the “dominant refiner” and has an average market share of 70 per cent.
India’s long road to net zero
India has vowed to achieve net-zero emissions by 2070, a pledge supported by smaller goals. By 2047, the year by which India seeks to have become a developed economy, its nuclear power capacity is projected to reach 100 GW. Currently, it is at 8 GW.
The IEA also notes India’s advancements in increasing its renewable energy share and infrastructure. This year, India met its target for grid-connected capacity “five years ahead of schedule.”
“This success was underpinned by surging investments in renewables. In 2015, every dollar invested in fossil fuel power generation sources in India was broadly matched by a dollar invested in non-fossil fuel resources,” says the report. “By 2025, this ratio had increased to 1:4 in favour of non-fossil sources.”
While solar and wind are India’s “fastest growing” sources of renewable energy, the WEO also acknowledges that coal and oil continue to be “mainstays.” According to the stated policies framework, India’s carbon dioxide emissions will peak in 2040.
(Edited by Asavari Singh)