IEA projects 11% drop in 2026 renewable additions as China slows

The International Energy Agency (IEA) projects a global decline in renewable capacity additions for 2026. The agency forecasts an 11% drop in total installations compared to the previous year.

A significant factor in this outlook is the slowdown in China. According to the IEA, Chinese solar additions from January to September 2026 fell 55% year on year. The report attributes this decrease to changes in support mechanisms and pricing frameworks within the country.

Long-term expansion outlook

Despite the projected near-term dip, the International Energy Agency (IEA) anticipates substantial growth in renewable capacity over the coming half-decade. The agency expects 4,800 GW of additional renewable capacity to be installed between 2026 and 2031. This volume represents an increase of almost 60% compared to the total additions recorded during the previous six-year period.

Solar photovoltaic technology will dominate this expansion phase. According to the IEA, solar PV is set to account for over 75% of the total capacity growth expected between 2026 and 2031.

Regional shifts and manufacturing

• China’s share of global renewable capacity additions will fall from over 60% in 2025 to 53% during the 2026–2031 period, according to the International Energy Agency (IEA).
• India’s renewable expansion is expected to be 2.6 times larger than its previous six-year period, the IEA states.
• The country’s share of global capacity additions will reach nearly 8.5%, the agency projects.
• India’s share of global solar module manufacturing is expected to reach 17% over the next five years, according to the IEA.

Grid bottlenecks and emerging markets

Grid connection delays are emerging as a critical constraint on the pace of renewable deployment. According to the International Energy Agency (IEA), the volume of advanced-stage renewable and storage projects awaiting grid connection has increased by 60% over the past year, reaching a total of 3,000 GW. This backlog is substantial, representing four times the amount of wind and solar capacity that was actually connected to the grid during the same period.

While grid constraints weigh on immediate output, the IEA projects a significant shift in where new capacity is being built. Distributed solar is expected to contribute 1,530 GW to the global total over the coming years. Concurrently, renewable capacity additions in Southeast Asia, the Middle East, North Africa, and sub-Saharan Africa are projected to triple over the next six years.

The IEA notes that emerging and developing economies outside China are expected to match advanced economies in terms of total capacity additions.

India’s manufacturing rise and Sub-Saharan Africa’s forecast revision

This development frames India as a viable alternate production hub inside a supply network still led by China.

Regarding sub-Saharan Africa, the IEA implemented the most significant percentage increase in its projections relative to other areas. Distributed solar setups, such as rooftop and off-grid units, are highlighted as crucial for this region. Such systems are emerging as a workable solution to inconsistent power grids and costly options in numerous local economies.

Although China continues to be the global leader in renewable-energy expansion, the IEA observes it may still surpass its own renewable rollout goals. The organization stresses that China’s manufacturing supremacy is not vanishing merely because its portion of new builds is falling, given its deep roots in the worldwide solar supply chain.

First annual decline in two decades

The International Energy Agency (IEA) characterizes the anticipated 11% decrease in 2026 as the initial yearly reduction in worldwide renewable capacity growth over the past 21 years. Even with this contraction, the organization notes that cumulative installations will still rank as the second-largest ever recorded. The IEA anticipates a gradual rebound, driven by emerging markets that will offset China’s decelerating expansion.

What to watch

The International Energy Agency (IEA) notes that no timeline has been provided for when new manufacturing centers will achieve competitiveness in cost, technology, and scale.