In 2025, Iran’s electricity consumption was overwhelmingly supplied by fossil fuels: about 97% came from fossil sources, compared with just 3.5% from low-carbon electricity. Gas supplied almost three-quarters of electricity, while oil accounted for roughly another fifth. All the low-carbon electricity reported in the supplied 2025 breakdown came from hydropower. This heavy dependence on fossil fuels highlights the opportunity to expand clean electricity and reduce the climate change and air pollution associated with fossil-fuel use.

Is Electricity Growing in Iran?

The supplied figures show a sharp decline rather than growth in Iran’s electricity consumption. Consumption in 2025 was about 1,170 kWh per person, down from the 2024 record of roughly 4,250 kWh per person—a fall of about 3,080 kWh, or nearly three-quarters. Low-carbon electricity generation also fell substantially: at just 41 kWh per person, it was about 436 kWh below the 2019 record of 477 kWh per person, a decline of around 91%. These figures indicate a worrying contraction, although they do not explain its causes. Restoring and expanding electricity supply, particularly clean generation, is important for supporting electrification and future demand, including from AI.

Suggestions

Iran can increase low-carbon electricity generation by expanding solar and nuclear power, alongside wind generation in suitable locations and investment in electricity grids. Nearby Pakistan offers a useful example, generating about a quarter of its electricity from solar and 13% from nuclear. Other relevant regional examples include the United Arab Emirates, where nuclear supplies a fifth of electricity, and Armenia, where it supplies almost a third. For solar development in sunny, dry conditions, Iran can also learn from the US state of Nevada, where solar provides 35% of electricity. Turkey’s electricity shares of roughly 12% wind and 11% solar illustrate opportunities for both technologies in the wider region. France, with about two-thirds of its electricity generated by nuclear, demonstrates how nuclear can form the backbone of a large clean electricity supply.

History

Iran’s low-carbon electricity history shows repeated gains followed by substantial reversals. Hydropower rose by 2.5 TWh in 1992 but fell by almost the same amount in 1994. During the early and mid-2000s, several increases—including 5.5 TWh in 2005—were followed by a steep 13 TWh decline in 2008; smaller gains returned between 2009 and 2011. Nuclear generation increased by 2.7 TWh in 2013 and 3.7 TWh in 2016, when hydropower also grew. Hydropower then surged by about 18 TWh in 2019, before falling by nearly 11 TWh in 2020 and another 9 TWh in 2021. The additional 2.8 TWh decline in nuclear generation in 2021 was a particularly disappointing setback for clean electricity supply, although a 3 TWh rebound followed in 2022. Hydropower recovered by 8.6 TWh in 2023 but dropped by 18 TWh in 2025, reinforcing the importance of sustained expansion across nuclear, solar and other low-carbon electricity sources.

Electricity Imports and Exports

Balance of Trade