Can Renewable Energy Replace Fossil Fuels? What the Data Now Shows

As the world races toward net-zero targets and intensifies its decarbonisation efforts, one question sits at the centre of the global energy debate: can renewable energy truly replace fossil fuels?

A growing number of analysts argue that not only can renewables take over — they already are. Clean electricity now accounts for more than 40% of the global power mix, with solar power leading as the fastest-growing energy source in history. New analysis shows that clean technologies could ultimately replace up to 75% of existing fossil fuel demand.

Between 2023 and 2024 alone, new solar, wind and battery capacity displaced over 650 terawatt-hours (TWh) of fossil-fuel generation — more than South Korea’s total annual electricity consumption.

“The message is clear: The clean energy transition is accelerating, and fossil fuels are losing ground,” says Maria Mendiluce, CEO of the We Mean Business Coalition. “The smart move now is to double down on clean energy — it is where growth, jobs and competitiveness lie.”

Adair Turner, chair of the Energy Transitions Commission, underscores the same point: “Fossil fuels are running out of road. The transition in many sectors is no longer a choice but an economic inevitability, as low-cost solar power, batteries and electric vehicles disrupt demand for fossil fuels in all regions of the world.”

Are Fossil Fuels More Efficient Than Clean Energy?

Efficiency is often cited as a reason fossil fuels can’t be replaced. The data shows the opposite.

Fossil fuels have high energy density, but poor conversion efficiency:

• Gasoline car engines waste around 80% of their energy as heat.
• Coal and oil power plants convert just 30-40% of their input energy into electricity.
• Even natural gas plants — among the most efficient — lose 56% of their energy across U.S. facilities through heat and transmission.

Renewable energy sources, by contrast, convert a larger share of available energy into electricity or usable power:

• Solar PV panels convert 20-23% of sunlight directly into electricity with minimal losses.
• Wind turbines convert 45-50% of wind’s kinetic energy — extraordinarily high for a mechanical system.
• Electric motors, which power EVs, operate at 85-95% efficiency, far outperforming internal combustion engines.

Renewables Keep Improving as Capacity Factors Climb

Meanwhile, renewable energy technologies themselves are getting better. Capacity factors — the ratio of actual output to maximum potential — continue to rise:

• Solar PV increased from 14% to 16% between 2010 and 2023.
• Onshore wind rose from 27% to 36%.
• Offshore wind jumped from 38% to 41%, now comparable to conventional fossil-fuel generation.
• Concentrated solar power increased from 30% to 55%, an 83% improvement since 2010.

Integrating Alternative Energy Sources with Storage and Firm Power

Solar and wind still depend on weather, which means they must be paired with complementary technologies to deliver consistent power. Here, battery storage, hydropower, geothermal plants and more flexible grids play an increasingly decisive role.

Hydropower remains one of the most dependable sources of base load and backup electricity, though droughts pose growing risks.

Geothermal Energy: A Persistent but Underused Resource

Geothermal power, with its near-continuous output, remains underdeveloped globally but has proven its worth in countries such as Kenya, Iceland, El Salvador and New Zealand, where it supplies more than 20% of electricity.

“We’ve turned to the sun, the rivers, the seas, the wind, but there’s also tremendous power beneath our feet,” says Dr. Rebecca Pearce, a research fellow at the Cascade Institute at Royal Roads University. “Geothermal holds enormous potential to provide clean, constant, reliable energy to our grid for thousands of generations to come.”

Today, geothermal accounts for just 1% of global energy demand. Yet, with advancements in drilling and heat extraction, the International Energy Agency (IEA) says it could supply up to 15% of global electricity demand growth by 2050, equivalent to nearly 6,000 TWh — the current electricity use of the U.S. and India combined.

Fossil Fuel Production Is Losing Ground

A decade ago, fossil fuel investment exceeded clean energy spending. Today, clean energy receives twice as much capital, according to analysis from the We Mean Business Coalition, the Energy Transitions Commission, Ember and E3G.

The economics explain why: renewables are now the cheapest form of new electricity in most markets, even without subsidies.

The IEA projects that global renewable power capacity will grow by 4,600 GW between 2025 and 2030 — roughly equal to the power generation capacity of China, the EU and Japan combined.

A New Era for Nuclear Power

Nuclear energy is also regaining momentum. The IEA expects nuclear plants to generate a record amount of electricity in 2025, with more than 70 GW of new capacity under construction — one of the highest levels in three decades.

The Transition to Clean Energy Is Underway — Even If the Politics Lag

At COP30, more than 80 countries negotiated a plan to phase out fossil fuels, building on the COP28 pledge to “transition away” from coal, oil and gas. The final text, however, softened language on explicit phaseout timelines after pushback from major fossil fuel producers.

Despite the political hesitation, many countries and cities are already advancing aggressively. Burlington, Vermont, became the first U.S. city to source 100% of its electricity from renewables back in 2014, setting an early example of what a clean-energy future can look like.

In the United Kingdom, the country shut down all of its coal-fired power stations by 2024 and followed up in 2025 with a ban on new offshore oil and gas drilling. Denmark is moving in the same direction as it works toward eliminating gas heating by 2035, while in Germany, a growing number of municipal utilities are voluntarily planning to retire their gas networks altogether.

The shift is equally striking in South Australia, which closed its final coal plant in 2016. Renewables now provide around 75% of the state’s electricity and are expected to meet all demand by 2027.

“Fossil fuel importing countries are still reeling from the energy crisis and are seeking to cut their dependence on expensive and insecure fossil fuels,” says Dave Jones, chief analyst at Ember. “Renewables and electrification will dominate the future — and fossil-importing nations will gain the most by embracing them.”

Southeast Asia: Immense Potential, Continued Natural Gas Reliance

Southeast Asia has enormous renewable resources — an estimated 20 terawatts of untapped solar and wind, equal to 55 times the region’s current power capacity. Even a fraction of this could meet its soaring electricity demand, expected to double by 2050.

Yet, the region continues to expand gas use as it shifts away from coal. Southeast Asia is projected to become a net gas importer by 2027, with nearly USD 12 billion earmarked for boosting import capacity.

Geographical constraints and land scarcity mean the region must rapidly scale emerging technologies such as floating offshore wind, agrivoltaics and floating solar. Grid expansion will also be critical, as transmission bottlenecks remain one of the top barriers to renewable integration.

Repurposing Fossil Fuel Plants to Curb Greenhouse Gas Emissions

Globally, more than 6,500 fossil-fuel power plants remain in operation. Shutting them down outright is politically and economically difficult. Transforming them into clean-energy hubs offers a pragmatic alternative.

Research by IEEFA shows that repurposing coal plants into solar-plus-battery sites can deliver up to five times more value than simple decommissioning, while accelerating emissions reductions.

Fossil fuels currently account for 68% of global greenhouse gas emissions and nearly 90% of CO₂ output. Repurposing existing plants — using their grids, land and infrastructure — can slash emissions while speeding up clean-energy deployment. The Carbon to Clean Tracker already documents nearly 170 repurposed projects, mostly in developed countries.

Over the next 15 years, more than 300 GW of coal capacity is expected to retire, opening major repurposing opportunities across Latin America and Southeast Asia.

The Bottom Line: Renewable Energy Is Now Mainstream

The world is not yet free of fossil fuels — but the economics, technology and global momentum all point in one direction. Renewable energy sector have overtaken fossil fuel industry in investment, outperformed them in efficiency and begun reshaping power systems across continents.

The transition will not be linear, and politics will continue to slow progress. But the fundamentals are clear: clean energy is no longer an alternative — it is becoming the backbone of the global energy system.