In 2025, the landscape of electricity consumption in Iran is heavily reliant on fossil fuels, with these sources contributing an overwhelming majority, almost 97%, to the total electricity generation. Natural gas, as a part of this fossil mix, constitutes nearly three-quarters, while oil accounts for close to a quarter. On the clean energy front, low-carbon sources make up a mere fraction, just under 4% of the total electricity generated, with hydropower accounting for all of this low-carbon contribution. The disparity in the reliance on fossil versus low-carbon energy sources starkly highlights the urgent need for transitioning to more sustainable forms of electricity to curb pollution and combat climate change effectively.

Is Electricity Growing in Iran?

Recent trends in electricity consumption in Iran showcase a stark decline. As of 2025, electricity consumption per person stands at 1168 kWh, which marks a substantial decrease from the previous year's peak of 4245 kWh per person. This significant drop, amounting to approximately 3078 kWh per person, indicates a serious downturn in energy consumption. Similarly, low-carbon electricity generation has seen a sharp decline, plummeting to just 41 kWh per person from a previous height of 477 kWh per person in 2019. The decrease of 436 kWh per person in low-carbon electricity generation is particularly concerning as it reflects a step back in moving towards greener energy solutions.

Suggestions

To increase low-carbon electricity generation, Iran could benefit from the strategies employed by regions that have successfully increased their clean energy shares. Looking towards countries like France and Ukraine, which have achieved more than half of their electricity from nuclear power, embracing nuclear energy could substantially boost Iran's low-carbon electricity output. Similarly, Iran can take cues from states and countries such as Nevada and Lebanon, which have incorporated substantial solar capacities contributing around 30-31% of their electricity. Moreover, neighboring Pakistan's 24% solar-based electricity highlights the potential in similar climates. By leveraging both nuclear and solar power, Iran can significantly enhance its low-carbon electricity supply while reducing its dependency on fossil fuels.

History

Iran's history of low-carbon electricity generation has been a rollercoaster ride with varied peaks and declines. In the 1990s, fluctuations in hydropower were pronounced, starting with a modest increase in 1992 but losing momentum by 1994. The early 2000s saw occasional gains in hydropower, with significant increases in 2002 and 2003, yet this was contrasted by a sharp decline in 2008. The 2010s introduced nuclear energy into the mix, yielding steady gains in combination with hydropower, although recent years have seen setbacks, particularly the substantial hydropower losses in 2020 and 2021, compounded by a nuclear decrease in 2021. The marked decline of hydropower by 18 TWh in 2025 underscores the volatility and challenges in maintaining and expanding low-carbon electricity sources, making a case for a more resilient and diversified strategy focusing on nuclear and solar power.

Electricity Imports and Exports

Balance of Trade