Renewable energy installations are putting increasing pressure on electricity grids, storage infrastructure and energy systems struggling to keep pace with growing demand, according to a new report from the International Renewable Energy Agency (IRENA).
Released today, the World Energy Transitions Outlook 2026 warns that expanding renewable generation capacity alone won't deliver the global energy transition. Governments and industry must accelerate electrification, strengthen grid infrastructure, improve energy efficiency and invest in technologies that provide greater flexibility across electricity networks.
Despite record renewable capacity additions in 2025, grid development and energy efficiency improvements continue to lag behind rising global energy demand.
Under IRENA's scenario aligned with limiting global warming to 1.5°C, installed renewable power capacity would need to increase from approximately 5.2 terawatts (TW) to 38.2 TW by 2050. Electricity's share of global final energy consumption would need to reach 35% by 2035 and exceed 50% by mid-century, with solar and wind supplying more than 80% of electricity.
Grids, storage and flexibility become critical
The report identifies electricity networks, storage and system flexibility as essential infrastructure for integrating greater volumes of renewable generation.
Without corresponding investment in transmission and distribution infrastructure, additional renewable capacity risks being constrained by limited network capacity, inadequate flexibility and the inability to deliver electricity where and when it is required.
Energy efficiency is also a challenge. Improvements are still below the rate needed to offset increasing demand, placing additional pressure on generation capacity and electricity infrastructure.
IRENA Director-General Francesco La Camera said the global energy transition was under stress, with existing electricity systems struggling to accommodate rapid changes in generation and consumption.
"We cannot deliver the transition by simply adding renewables to an unchanged energy system," he said.
Investment requirements reach US$10.3 trillion annually
IRENA estimates that investment and related expenditure under its 1.5°C scenario would need to average approximately US$10.3 trillion annually between 2026 and 2050, directed towards renewable generation, electricity grids, flexibility, efficiency and electrification of end uses.
The report also outlines potential economic benefits from an accelerated transition. Under its scenario, global economic growth could average 1.1% annually above the business-as-usual pathway, generating cumulative economic gains of approximately US$46 trillion by 2050.
Renewable energy employment could increase more than fivefold from today's level of over 16 million jobs, while improved electricity competitiveness could contribute to end-user electricity prices being 15% lower by 2050.
These outcomes are conditional on the investment, policy reforms and infrastructure development envisaged in the scenario.
Implications for South Africa
The report's findings are particularly relevant to South Africa, where expanding renewable electricity generation must be accompanied by adequate transmission capacity, grid connections and system flexibility.
For project developers, utilities and industrial electricity users, part of the challenge is ensuring that new generation can be integrated into the network and delivered reliably to consumers.
Investment in network reinforcement, storage, grid management and demand-side efficiency are vital, as is additional renewable power capacity.
Seven priorities for the coming decade
IRENA identifies seven areas requiring coordinated action, including integrated energy and market planning, electricity grid modernisation, stronger industrial and investment strategies, social and environmental policies and greater international cooperation.
The agency argues that governments must manage the transition in a way that preserves energy security, affordability and reliability while accelerating the deployment of cleaner technologies.
The report concludes that the pace of renewable energy development must be matched by changes across the wider energy system if the benefits of electrification are to be realised.
Read IRENA's World Energy Transitions Outlook 2026
Source: International Renewable Energy Agency (IRENA), World Energy Transitions Outlook 2026, released 13 October 2026.
