Solar energy is projected to become the world’s largest source of electricity by 2035, overtaking coal, oil, and natural gas, according to a new report by BloombergNEF.
The report says falling solar costs and rising global electricity demand are pushing the transition toward renewable energy. However, it also warns that the expansion of artificial intelligence and data centers could keep fossil fuels relevant for decades because of their ability to provide continuous power.
BloombergNEF said solar growth is being driven primarily by economics rather than government policy, with solar technology becoming affordable due to large-scale manufacturing and industrial support, particularly from China.
Countries like Pakistan are already responding to energy market pressures, adding 25 gigawatts of solar power over the past two years after natural gas prices increased following Russia’s invasion of Ukraine.
At the same time, electricity demand is rising due to AI systems, electric vehicles, industrial electrification, and the expansion of data centers. BloombergNEF estimates that data centers alone could drive demand for an additional 1 terawatt of utility-scale solar power, alongside major increases in natural gas and coal generation.
The report forecasts that natural gas and coal could still supply 51% of additional electricity generation for data centers by 2050, despite renewable energy growth.
“Tech companies and data center developers will have an outsized influence over which energy sources remain viable by mid-century” – The report
Experts believe that falling solar prices and improved battery storage are making clean energy more economically competitive than fossil fuels. While others in the energy industry argue that renewable sources alone may not yet provide the reliable, around-the-clock electricity required for AI infrastructure and large-scale data centers. As a result, many operators continue to rely on natural gas and coal for stable power generation.
Companies including Google are also investing in long-duration batteries and alternative energy systems to reduce fossil fuel dependence. Meanwhile, firms such as Fervo Energy and X-energy are promoting geothermal and nuclear solutions for future energy needs.
BloombergNEF estimated that solar costs may fall another 30% by 2035, thereby strengthening its market position. BloombergNEF said energy independence could improve as countries expand renewable energy production and reduce reliance on imported fuels. According to the report, energy competition may likely increase on which technologies can provide both affordability and reliable electricity for fast-growing AI infrastructure.
Renewable energy demand gains momentum in Africa
Across Africa, the global transition toward solar energy carries major implications for electricity access, industrial growth, and digital development. Many African countries continue to face unstable power supply, rising fuel import costs, and increasing electricity demand driven by population growth and expanding digital infrastructure.
Countries such as Nigeria, South Africa, Kenya, and Egypt are increasing investments in solar and renewable energy projects as governments seek alternatives to expensive fossil fuel generation and unreliable national grids.
Africa’s growing fintech ecosystem, telecom networks, data centers, and AI-driven services are also increasing pressure on electricity infrastructure.
According to experts renewable energy could become essential for supporting the ever expanding digital economy of the continent. They believe Africa possesses some of the world’s highest solar energy potential, yet millions of people across the continent still lack reliable electricity access.
As solar technology becomes cheaper globally, African countries may likely adopt decentralized solar systems, mini-grids, and battery storage projects to improve power supply in underserved communities.
