Key highlights from the report “Electricity Mid-Year Update 2026” published by the International Energy Agency (IEA) are as follows:
- Global power demand is on track to rise faster in 2026 and 2027 than in 2025, even as the Middle East crisis temporarily increases electricity generation costs and as emergency energy conservation measures are implemented in some regions.
- Major economies have so far adapted to the loss of liquefied natural gas (LNG) supplies from the Strait of Hormuz while meeting rising power demand.
- A stronger-than-expected El Niño event in 2026 could increase global electricity demand further by raising cooling needs in many regions.
- Electricity generation from renewables is set to overtake coal-fired output in 2026, widening their share in the global electricity supply mix.
- Solar photovoltaic (PV) remains the largest contributor to electricity supply growth on a global basis.
- Higher natural gas prices are expected to limit growth in natural gas-fired generation in 2026 while supporting increased coal-fired output.
- Nuclear power generation is expected to increase again in 2026, albeit at a slower pace, before accelerating strongly in 2027.
- Carbon dioxide emissions from electricity generation are expected to increase by 1 per cent in 2026 and then plateau in 2027.
- While negative electricity prices have become a common occurrence across multiple markets, wide hourly price spreads during the day continue to highlight the growing value of flexibility. The Strait of Hormuz crisis drove spikes in LNG prices, translating into higher costs for gas-fired electricity generation and pushing up wholesale electricity prices in several regions from March onward.
Access the report here