World must double renewable build-out to hit 2030 goal
Renewable energy capacity broke records in 2025, yet the world remains far short of the pace needed to meet the 2030 climate goal agreed at COP28. A new report from the International Renewable Energy Agency and the Global Renewables Alliance, prepared with the COP31 Presidency, confirms that annual installations must more than double over the next five years to deliver the tripling pledge made in Dubai.
The numbers tell a clear story. Global installed renewable capacity reached 5.15 terawatts by the end of 2025. The 2030 target stands at 11.2 terawatts. Consequently, the world needs to add roughly 1,200 gigawatts of new renewable capacity every year from 2026 to 2030. That compares to the record 693 gigawatts added in 2025.
For UK businesses, this shortfall matters. Supply chains, energy costs, compliance timelines and procurement requirements are all shaped by the pace of the global energy transition. When international deployment targets slip, the knock-on effects reach businesses trading in regulated sectors, bidding for public contracts, or managing emissions across international operations.
The COP28 commitment and what it requires
More than 100 countries signed up to the UAE Consensus at COP28 in December 2023. The agreement set two headline goals: triple global renewable energy capacity by 2030 and double the rate of energy efficiency improvement. Both targets were designed to keep the 1.5-degree warming limit within reach.
IRENA had already flagged the scale of the challenge in earlier tracking reports. Before 2025 ended, the agency estimated that the world would need about 1,044 gigawatts of new renewable capacity every year from 2024 to 2030 to reach the 11.2 terawatt target. That figure was well above historic deployment rates.
The latest report narrows the window further. Because 2025 fell short of the required trajectory, the remaining years now demand an even steeper build rate. Specifically, average annual additions between 2026 and 2030 must hit approximately 1,200 gigawatts. Reuters described the requirement bluntly: renewable deployment must more than double from current levels to close the gap by decade's end.
This is not a marginal adjustment. Meeting the target means building more renewable capacity in the next five years than has been installed in the entire history of the sector. Moreover, the challenge extends beyond manufacturing and installation. Grids, storage systems and transmission infrastructure must expand in parallel, or new generation capacity will sit idle.
Investment gaps and infrastructure bottlenecks
The report estimates that around $8.6 trillion in additional investment will be needed between 2026 and 2030 to deliver the required renewable capacity. Meanwhile, grid modernisation and flexibility investment must rise to nearly $1 trillion annually. These are not optional extras. Without them, renewable generation will continue to outpace the ability of power systems to absorb it.
Grid constraints are already visible across multiple markets. Transmission networks designed for centralised fossil fuel generation struggle to handle distributed renewable input. Permitting delays slow both generation projects and the grid upgrades needed to connect them. Financing structures remain mismatched to the scale and speed of deployment required.
Storage and system flexibility have emerged as critical bottlenecks. Solar and wind output varies by weather and time of day. Consequently, balancing supply and demand requires battery storage, pumped hydro, demand response and interconnection capacity. These technologies are growing, but not fast enough to keep pace with generation additions.
For businesses, these infrastructure gaps translate into practical risks. Energy price volatility increases when grids lack flexibility. Project timelines extend when permitting backlogs grow. Supply chain planning becomes harder when policy frameworks lag behind deployment ambitions. Therefore, understanding where infrastructure investment is concentrated helps businesses anticipate where energy costs and availability will stabilise first.
Implications for UK businesses and procurement
UK companies face direct consequences from the global deployment gap. Public sector suppliers must demonstrate carbon reduction under Procurement Policy Note 06/21, which requires bidders to publish a carbon reduction plan and report emissions annually. Those commitments depend partly on access to affordable renewable energy, both in the UK and across international supply chains.
Energy-intensive sectors such as manufacturing, food production and logistics are particularly exposed. If global renewable deployment falls short, fossil fuel infrastructure retains market share longer. That delays cost reductions, slows decarbonisation and extends the period during which businesses must manage dual energy systems and uncertain carbon pricing.
Supply chain emissions also depend on the pace of renewable deployment in trading partner countries. Scope 3 emissions reporting increasingly requires businesses to account for the carbon intensity of purchased goods and services. When overseas suppliers lack access to renewable energy, UK businesses struggle to reduce their full value chain footprint.
Additionally, trade policy is starting to reflect climate commitments. The EU's Carbon Border Adjustment Mechanism, which began its transitional phase in October 2023, will impose costs on imports from high-carbon jurisdictions from 2026. UK businesses importing steel, cement, aluminium, fertilisers, electricity or hydrogen must track the embedded emissions of those goods. Slower renewable deployment in supplier countries increases compliance costs and complicates carbon accounting.
Financial markets are also responding. Lenders and investors increasingly price climate risk into capital allocation decisions. Companies operating in sectors dependent on fossil fuel infrastructure may face higher borrowing costs or reduced access to green finance. Conversely, businesses able to demonstrate credible decarbonisation pathways supported by renewable energy procurement can access preferential terms.
Tracking progress against the 2030 goal
- Global renewable capacity stood at 5.15 terawatts by the end of 2025, leaving a gap of approximately 6 terawatts to the 2030 target.
- Record additions of 693 gigawatts were installed in 2025, yet this falls well short of the 1,200 gigawatts needed annually from 2026 onwards.
- Investment of around $8.6 trillion is required over the next five years to fund new renewable generation capacity.
- Grid modernisation and flexibility investment must reach nearly $1 trillion per year to accommodate variable renewable output.
- Permitting delays, transmission bottlenecks and financing gaps remain significant obstacles to faster deployment.
- The report warns that without accelerated action, the world will miss the COP28 tripling target despite record progress in 2025.
What businesses should consider now
The deployment gap creates both risks and planning opportunities. Businesses should review their energy procurement strategies to understand how slower global renewable growth might affect costs, availability and compliance timelines. Long-term power purchase agreements can lock in pricing and reduce exposure to fossil fuel volatility, but they require careful assessment of grid connection timelines and supplier viability.
Carbon reporting obligations are tightening. Under PPN 06/21, suppliers to central government must update their carbon reduction plans annually. Similarly, businesses preparing for mandatory climate disclosures under UK sustainability reporting rules need reliable data on energy sourcing. If renewable deployment lags, alternative decarbonisation measures such as energy efficiency, process changes or nature-based offsets may need to carry more weight in reduction plans. Our net zero program for carbon reporting compliance helps businesses build credible reduction pathways and meet public sector requirements.
Supply chain resilience also deserves attention. Businesses dependent on international suppliers should map where their Scope 3 emissions are concentrated and assess whether those regions are on track to meet renewable deployment targets. Where suppliers operate in markets with slow grid decarbonisation, businesses may need to support direct renewable procurement or explore alternative sourcing options.
Grid infrastructure investment offers a forward indicator. Regions investing heavily in transmission upgrades, storage and flexibility are more likely to absorb renewable capacity quickly. Consequently, businesses with flexibility over site location or supply chain geography can prioritise markets where energy transition infrastructure is advancing fastest. This reduces long-term exposure to stranded fossil assets and unstable energy pricing.
Training and internal capability matter too. Understanding renewable energy procurement, carbon accounting and compliance requirements is no longer optional for businesses tendering in regulated markets. The SBS Academy offers training on Scope 3 emissions and sustainability reporting, helping teams build the skills needed to navigate tightening requirements.
Policy engagement can also play a role. Trade associations, sector groups and procurement frameworks influence how quickly governments remove barriers to renewable deployment. Businesses affected by permitting delays or grid connection backlogs should consider whether collective advocacy through industry bodies can accelerate infrastructure investment or streamline approval processes.
Authoritative sources and further reading
IRENA publishes regular tracking reports on renewable energy deployment and the progress towards international climate targets. These reports provide detailed breakdowns by technology, region and investment requirement. The agency's work informs national policy and international climate negotiations.
The UK government's Department for Energy Security and Net Zero sets domestic renewable energy policy and oversees grid planning. Its publications include updates on offshore wind pipelines, planning reforms and grid connection timelines relevant to UK businesses.
For businesses navigating public sector procurement, the Procurement Policy Note 06/21 guidance on carbon reduction plans explains reporting obligations and compliance expectations for suppliers bidding on central government contracts above £5 million annually.
The International Energy Agency also tracks global energy transitions and publishes annual reports on renewable capacity, investment trends and policy developments. Its data complements IRENA's analysis and provides additional context on fossil fuel markets and energy security.
UK businesses seeking support with carbon reporting, sustainable procurement or compliance can access sector-specific guidance through our ESG compliance and carbon reporting services, which translate international trends into practical commercial advice for UK SMEs.