• Global electricity demand is set to rise 75% by 2050, with data centers alone requiring 3,700TWh—nearly 9% of total demand.
• Clean energy and EVs are scaling rapidly due to economic competitiveness, yet fossil fuels remain entrenched, especially in gas and aviation.
• BloombergNEF’s Economic Transition Scenario (ETS) reduces emissions by only 22% by 2050—still aligned with 2.6°C warming, far from Paris targets.

BloombergNEF’s New Energy Outlook 2025 delivers a sharp assessment of how the global energy transition may unfold by mid-century—assuming market forces, not climate mandates, dictate investment. While renewables and electrification gain ground, the current trajectory falls short of net-zero goals.

“The trajectory required for the world to achieve net zero by 2050 in line with the Paris Agreement has not changed, though there is less time than ever.”

A Data-Hungry Digital World

A major new demand driver is the explosive growth of data centers, fueled by AI and digital infrastructure. These facilities will consume 3,700TWh by 2050, up from 1,200TWh in 2035, eventually surpassing heating and cooling as a power draw.

“We find that an additional 362 gigawatts of power plant capacity is required by 2035 to meet data-center demand… Renewables (47%) and storage (9%) together make up more than half of the needed capacity.”

However, 64% of the incremental power generation to meet this demand is still projected to come from fossil fuels, potentially prolonging the life of coal and gas plants.

Renewables and EVs Lead—but Face Headwinds

Clean technologies continue to thrive on cost-competitiveness. Renewable generation doubles by 2050, supplying 67% of electricity needs. EV adoption surges, with two-thirds of all passenger vehicles projected to be electric by mid-century.

“Sales of passenger electric vehicles increase to 42 million in 2030… and almost double to 80 million in 2050.”

Still, interest rate pressure, trade barriers, and infrastructure gaps temper the momentum.

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Fossil Fuels: A Mixed Outlook

Oil demand peaks in 2032, yet remains 88 million barrels per day by 2050. Coal falls sharply, while gas diverges: growing in the ETS but halving under Bloomberg’s Net Zero Scenario.

“Gas now plays a larger role… Global natural gas demand increases 25% from 2024 to 2050… led mainly by the US.”

Net Zero Technologies Still Struggle Without Policy

Hydrogen, CCS, sustainable aviation fuels, and low-carbon industrial processes remain niche in the ETS due to high costs and absent policy support.

“Unlike renewables and EVs, hydrogen, carbon capture and storage, clean fuels and low-carbon industrial processes all struggle to make an impact.”

Heat pumps only supply 25% of heating in cold-climate homes by 2050. Industrial emissions barely budge.

The U.S. Holds Steady

Despite political shifts and regulatory uncertainty, the U.S. energy transition remains intact—though slower. Renewables and storage still expand, with solar capacity more than tripling and battery storage rising six-fold by 2035.

“Compared with our 2024 base case, the US transition is slowed but not derailed.”

Global Emissions May Have Peaked

2024 could mark the first year of sustained global CO₂ decline, signaling a structural shift—driven primarily by clean power and electrification.

“Three-fourths of the emissions avoidance [to 2050] comes from deployment of clean power technologies.”

Yet, the ETS only achieves a 22% emissions cut by 2050, keeping the planet on track for 2.6°C of warming—well above Paris Agreement targets.

Without robust policy action and targeted investment in harder-to-abate sectors, market economics alone won’t deliver net zero. Clean energy remains a smart bet, but the transition’s full potential hinges on policy-driven momentum, especially in sectors beyond power and transport.

Read the full energy outlook here.

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