The Cabinet Information and Decision Support Center (IDSC) said that the global energy sector is undergoing rapid structural transformation despite persistent geopolitical and trade challenges affecting energy markets and supply chains. Reviewing a report by the International Energy Agency (IEA) on Monday, July 20, 2026, the center said that energy has become a key pillar of economic stability and national security, while long-term shifts toward low-emission energy sources continue to gather pace.
According to the report, global energy demand grew by 1.3 percent in 2025, slightly below the average recorded over the previous decade, supported by improved economic conditions and higher energy efficiency. Renewable energy and nuclear power accounted for around 60 percent of the increase in global demand, with solar photovoltaic (PV) power alone contributing more than one-quarter of the growth.
The report said electricity continues to drive the energy transition, with global electricity demand rising by around 3 percent in 2025 -more than double the growth rate of overall energy demand. Solar power recorded the largest annual increase, with approximately 600 gigawatts of new capacity added, while renewable energy additions reached a record 800 gigawatts.
Battery energy storage also expanded significantly, growing by more than 40 percent with over 100 gigawatts of new storage capacity added. Concerning investment, the report projected total global energy investment to reach approximately dlrs3.4 trillion in 2026, marking a 5 percent increase from 2025.
Around dlrs 2.2 trillion is expected to be directed toward renewable energy, nuclear power, electricity grids, energy storage, low-emission fuels and energy efficiency, compared with about $1.2 trillion allocated to oil, natural gas and coal. Investment in electricity supply and infrastructure is forecast to reach dlrs 1.6 trillion in 2026, rising to around dlrs 2 trillion when spending on end-use electrification is included.
The report also highlighted the rapid expansion of the clean energy technology market, which posted an average annual growth rate of nearly 20 percent between 2015 and 2024, driven primarily by the electric vehicle market. The sector is expected to grow by about 25 percent in 2025, reaching an estimated value of dlrs 1.2 trillion- surpassing the coal market and approaching the size of the natural gas market.
Despite this progress, energy-related carbon dioxide emissions continued to rise modestly in 2025 by 0.4 percent. However, the increased deployment of renewable energy, nuclear power, electric vehicles and heat pumps helped avoid nearly 3 gigatons of CO₂ emissions, equivalent to around 8 percent of total global energy-related emissions.
The report concluded that current policies remain insufficient to achieve international climate goals. It warned that existing national commitments would result in only a limited decline in emissions by 2035, stressing that accelerating the global energy transition requires broader international cooperation and stronger coordination among governments, the private sector and value chains to translate the current momentum in investment and technological innovation into more impactful and sustainable outcomes.
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