Renewable Energy Market to Soar to US$ 3875 Bn by 2035: Driving the Global Net-Zero Transition
The renewable energy market is at the forefront of the global transition toward sustainability. With climate change concerns, net-zero commitments, and rapidly advancing technologies, renewable power is reshaping the global energy landscape. The market, valued at US$ 1060.7 Bn in 2024, is projected to expand at a CAGR of 12.5% from 2025 to 2035, ultimately reaching an impressive US$ 3875.0 Bn by the end of 2035.This significant growth underscores how renewable energy sources such as solar, wind, hydropower, biomass, and emerging technologies like green hydrogen are becoming central to electricity generation, industrial applications, and transportation systems.
Analysts’ Viewpoint on Renewable Energy Market Scenario
The renewable energy industry is gaining momentum due to a combination of climate commitments, falling costs, and favorable government policies. Nations are increasingly investing in renewable power projects, from large-scale solar photovoltaic farms and offshore wind projects to hybrid renewable-storage systems.
One of the critical shifts in the market is the improvement in energy storage technologies. With smart grids and advanced batteries, renewable power is no longer seen as unreliable due to variability. Instead, it is evolving into a controllable, dispatchable, and scalable energy source.
In addition, long-term power purchase agreements (PPAs) are providing financial certainty for developers and industries, while digital monitoring and predictive analytics are driving efficiency. The expansion of green hydrogen is also broadening the scope of renewable energy beyond electricity, moving toward industrial feedstock and clean fuels for transport.
Global Renewable Energy Market Overview
Renewable energy refers to energy derived from natural sources that are constantly replenished—such as sunlight, wind, water, geothermal heat, and biomass. Unlike fossil fuels, renewables do not deplete finite resources and typically carry minimal greenhouse gas emissions, making them vital for global decarbonization goals.
Today, renewables dominate the new power generation pipeline, with solar and wind leading in capacity additions. Hydropower, however, continues to remain the largest and most reliable segment, serving as a backbone for flexible and baseload electricity supply.
Market Growth Drivers
1. Global Sustainability Commitments and Decarbonization Targets
Governments worldwide are pushing aggressive emission reduction targets. Initiatives like the EU’s Fit for 55, the U.S. Inflation Reduction Act, and India’s renewable energy investment programs are fast-tracking adoption. Businesses are also under pressure to meet climate goals, prompting them to sign long-term PPAs and invest in clean energy solutions.
Financial markets have followed suit, with green bonds and clean energy funds channeling capital into renewables, creating a strong project pipeline across both developed and developing economies.
2. Declining Technology Costs and Innovation in Energy Systems
Over the past decade, solar PV module prices have dropped by more than 80%, while wind turbine efficiencies have soared, making renewable electricity competitive with or cheaper than fossil fuels.
Innovation is fueling further growth:
- Floating solar farms and next-generation wind turbines are expanding capacity while reducing operating costs.
- Battery advancements, including solid-state and improved lithium-ion technologies, are solving the intermittency challenge.
- Digitalization, AI, and predictive analytics are enhancing grid integration and asset management, maximizing returns for investors.
Hydropower as a Key Market Segment
Hydropower remains the largest contributor to renewable energy capacity, accounting for over 40% of total renewable energy capacity and nearly 15% of global electricity supply. Its strengths lie in scalability, reliability, and storage capabilities through pumped-hydro facilities, which provide grid flexibility unmatched by other renewable sources.
Emerging economies such as Brazil, India, and China continue to expand hydropower capacity to meet rising electricity demand. Modernization of existing plants in the U.S. and Europe is also extending the lifespan and efficiency of aging infrastructure.
Regional Market Insights
Asia-Pacific: The Leading Growth Hub
The Asia-Pacific region dominates the renewable energy market, largely due to China’s leadership in solar and hydropower investments, accounting for nearly 30% of global hydropower output. India and Southeast Asia are following closely with significant renewable targets and large-scale dam projects.
Brazil: A Hydropower Powerhouse
Brazil relies on hydropower for more than 60% of its electricity supply, leveraging the Amazon basin’s river resources. Government-backed initiatives and modernization of older facilities are strengthening its role as the world’s second-largest hydropower producer.
North America and Europe
While growth in the U.S. is moderate compared to Asia-Pacific, grid modernization, small hydro expansions, and renewable integration with storage are gaining traction. In Europe, strict decarbonization policies and ambitious carbon-neutrality goals are driving investment in solar, wind, and offshore wind projects.
Competitive Landscape
The renewable energy market is highly competitive, with utilities, technology developers, and energy innovators shaping its growth.
- Integrated utilities such as Iberdrola, Enel, Ørsted, and NextEra Energy manage diversified portfolios across solar, wind, hydro, and storage.
- Wind turbine leaders like Vestas and GE Vernova dominate the onshore and offshore wind markets.
- Storage and grid integration companies such as Tesla, Huawei, and Sungrow are critical to renewable adoption.
Recent Developments
- In 2025, Ørsted began offshore construction of the Greater Changhua 2b & 4 wind farms in Taiwan, featuring innovative suction-bucket jacket foundations and large Siemens Gamesa turbines.
- In 2024, NextEra Energy Resources entered a joint venture with Entergy to co-develop 4.5 GW of solar and storage projects in the U.S., targeting industrial and data center demand.
These projects highlight how leading companies are scaling up capacity while addressing regional electricity needs and sustainability goals.
Market Segmentation
The renewable energy market is segmented across type, application, connectivity, end-user, and region:
- By Type: Solar, Wind, Hydroelectric, Geothermal, Biomass, Wave & Tidal, Green Hydrogen, Waste-to-Energy.
- By Application: Heat, Electricity, Fuel.
- By Connectivity: On-Grid, Off-Grid.
- By End-user: Residential, Commercial, Industrial, Utilities.
- By Region: North America, Latin America, Europe, Asia-Pacific, Middle East & Africa.
Future Outlook: Renewable Energy in 2035
By 2035, the renewable energy market is expected to be nearly four times its 2024 value, reflecting widespread adoption and integration. Some of the key future trends include:
- Green Hydrogen Expansion: As costs decline, hydrogen will power industries, transport, and energy storage.
- Hybrid Projects: Combining solar, wind, and storage will create reliable 24/7 renewable power plants.
- Smart Grids & AI: Intelligent energy systems will balance supply and demand more effectively.
- Decentralized Power Systems: Rooftop solar, microgrids, and off-grid solutions will improve energy access in remote areas.
The renewable energy industry is no longer optional—it is an economic, environmental, and social necessity that will define the next decade of global development.
Conclusion
The Global Renewable Energy Market, projected to surpass US$ 3875.0 Bn by 2035, represents one of the most dynamic and transformative industries in the world. The combination of policy support, declining technology costs, innovation, and investor confidence is accelerating the clean energy transition