Renewables, EVs and batteries: the growth has moved south and east

The clean energy story is often told through Europe's targets and America's subsidies. The numbers for 2025 and early 2026 point somewhere else. The records are still being set in China, but the fastest growth has moved to Southeast Asia, Latin America, the Middle East and India, and the products that sell there are different.

Records, again

According to the International Renewable Energy Agency (IRENA), the world added a record 692 gigawatts of renewable power capacity in 2025, taking the total to 5,149 GW. That was 15.5% growth in a year, and renewables made up more than 85% of all new generating capacity. Solar alone accounted for 511 GW of the additions and wind for 159 GW.

Renewable power capacity added each year

Gigawatts, world

Asia added 513 GW, almost three-quarters of the world total. The Middle East grew its renewable capacity by close to 29% in the year and Africa by about 16%, both off smaller bases.

Electric cars pass a quarter of sales

The International Energy Agency (IEA) counts more than 20 million electric cars sold in 2025, a quarter of all new cars. It expects about 23 million in 2026, close to 30% of the market, helped by what it describes as the largest oil supply shock on record pushing buyers away from petrol and diesel.

Electric cars sold worldwide

Million vehicles, battery-electric and plug-in hybrid

The mix of where those cars are bought is shifting. Global sales fell about 8% in the first quarter of 2026 as China's market cooled, yet sales rose about 30% in Europe, about 75% in Latin America and about 80% across Asia Pacific outside China. In Southeast Asia, sales more than doubled in 2025 and electric cars reached about a fifth of the market, with Vietnam the largest buyer. More than 40 countries now sell one electric car in every ten.

Electric share of new car sales, 2025

Per cent of new cars sold

Batteries become the grid's shock absorber

The quieter growth market is stationary storage. The IEA reports 108 GW of battery storage added worldwide in 2025, 40% more than in 2024 and enough to make installed capacity eleven times what it was in 2021. China installed about 60% of it, followed by the United States and Europe. Lithium iron phosphate chemistry now accounts for roughly nine in ten projects, up from well under half five years ago, and project durations are lengthening from two hours towards four.

One line in the IEA's review links this sector to the AI build-out: battery-based backup power in data centres grew 30% to about 45 GW in 2025.

The supply side remains concentrated. China produced more than 80% of the world's battery cells and close to three-quarters of its electric cars in 2025, and Chinese carmakers supplied about 60% of global electric car sales.

Where the opportunity sits

Southeast Asia and Latin America are where electric car demand is growing fastest, and where price points, financing and charging needs look very different from Europe's.

The Middle East grew its renewable capacity by close to 29% in 2025, largely through big utility-scale solar projects, many now paired with storage.

India is a two- and three-wheeler market first: the IEA notes those segments grew by more than 30% in the first quarter of 2026. Non-fossil sources already make up more than half of India's installed power capacity, according to the Ministry of New and Renewable Energy, which shifts the problem from building capacity to balancing it, and that is a storage opportunity.

Trucks are the next segment to move. Electric trucks more than doubled their sales in 2025 to 9% of the global market, and in China one truck in four sold was electric.

What this means for leaders

• The growth markets need different products. Affordable cars, two- and three-wheelers, distributed solar and financing models matter more in Jakarta, São Paulo or Pune than premium features designed for Europe.
• Sourcing strategy is a board question. With cells, cars and components concentrated in one country, supply resilience and trade exposure need to be planned rather than assumed.
• Storage is a business in its own right. Grid services, data centre backup and commercial behind-the-meter systems are each growing faster than generation.
• Policy risk is uneven. Subsidy and tariff decisions in the US and Europe can move quickly. Demand in markets driven by fuel prices and costs is more durable.

The question is no longer whether the transition happens. It is which markets, which products and which supply chains it runs through.

Figures are as published by the sources above at the time of writing. Forecasts and company guidance are labelled as such and will change.

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