IEA’s World Energy Outlook 2025 Warns of Risks in the ‘Age of Electricity’

• The International Energy Agency (IEA) released its flagship report, the “World Energy Outlook 2025” , on November 11, 2025 , warning that the world faces its most complex energy security challenge in decades . The report calls for urgent global cooperation, diversification, and resilience building across energy systems as nations transition deeper into the “Age of Electricity.”

Energy Security Under Pressure

• IEA Executive Director Fatih Birol highlighted that energy security risks are now multifaceted , affecting not just oil and gas , but also renewables, power grids, and critical minerals . Comparing the present to the 1973 oil crisis , Birol described the 2020s as a “defining decade for global energy” , where overlapping geopolitical, technological, and supply chain vulnerabilities threaten long-term stability.

The ‘Age of Electricity’ and the Data Economy

• The report identifies this decade as the start of the “Age of Electricity.” Electricity now accounts for 20% of total global energy consumption but drives over 40% of global economic activity . Demand is being propelled by data centres, artificial intelligence, and digital infrastructure , with global investment in data centres expected to exceed $580 billion in 2025 , surpassing global oil sector spending for the first time.

Critical Minerals: The Next Security Flashpoint

• The IEA warns that critical minerals —used in solar panels, EV batteries, AI chips, and defence systems —pose a major security risk. A single nation controls refining for 19 of 20 key minerals , commanding an average 70% market share , exposing global supply chains to potential disruption.

Exam Pointers

• Report: World Energy Outlook 2025 (Released Nov 11, 2025)

• By: International Energy Agency (IEA)

• Executive Director: Fatih Birol

• Key Trends: Rise of electricity, critical minerals dependence, AI-driven demand

• Forecast: Data centre investments ($580 bn) to exceed oil spending

• Concern: 730 million people still lack electricity access

Outlook

The report projects strong growth in solar and nuclear energy , led by India and Southeast Asia , but warns that without accelerated investment and cooperation , the world risks surpassing 1.5°C warming .