In 2025, the world finds itself at a pivotal moment in the ongoing shift away from fossil fuels. With geopolitical uncertainties, economic headwinds, and rapid technological advances converging, it is both a time of challenge and boundless opportunity. Nations, communities, and industries are called to steer toward a clean energy future—one that balances affordability, reliability, and environmental stewardship.
This article illuminates the progress made, the obstacles ahead, and the concrete steps stakeholders can take to foster a just, resilient transition.
Global Progress and Regional Trends
The World Economic Forum’s Energy Transition Index shows that energy system performance rose by 1.2% in 2025, outpacing readiness improvements. Momentum is building, yet uneven development across regions demands tailored strategies.
- Emerging Asia: Strong policy frameworks and investment pipelines, but continued reliance on coal slows diversification.
- Latin America: Renewables penetration surges, yet financing gaps and institutional volatility hinder large-scale deployment.
- Middle East, North Africa, Pakistan: Solar and hydrogen pilot projects expand, but grid inflexibility and legacy infrastructure present hurdles.
- Sub-Saharan Africa: Rural electrification and regulatory reforms promise broad benefits, though underinvestment and supply-chain delays remain obstacles.
Understanding these dynamics allows governments and investors to target support where it will yield the greatest impact, from policy reform in Latin America to capacity-building in Sub-Saharan Africa.
Renewable Energy Boom: Solar, Wind, and Beyond
Global additions of solar and wind capacity soared over 60% year-on-year in early 2025. Solar PV accounted for a staggering 75% of new renewable installations, with 452 GW added, alongside 113 GW of wind.
Behind-the-meter solar paired with battery storage is gaining traction among businesses and households, driven by rapid cost declines for renewables.
- Solar PV systems now exceed 3,000 GW globally, half of which is in China and Europe.
- Wind farms deliver flexible, scalable power across diverse geographies.
- Emerging technologies—like floating offshore wind and agrivoltaics—are entering commercial markets.
Accelerating deployment requires streamlined permitting, enhanced grid integration, and local workforce development.
Phasing Down Fossil Fuels: Challenges and Opportunities
Despite modest declines in fossil-fuel generation, coal and gas remain entrenched. The IEA Net Zero Roadmap calls for a shift to a 50/50 fossil/non-fossil mix by 2050, while DNV projects fossil share falling to 4% by 2060.
Hard-to-abate sectors—such as heavy industry, aviation, and shipping—pose significant obstacles. Scaling up Carbon Capture, Utilization and Storage (CCUS) and Carbon Dioxide Removal (CDR) is critical for net-zero success.
Hydrogen’s role has been tempered in recent outlooks, but green hydrogen pilots in Europe and Asia highlight its potential in refining, steelmaking, and transport.
Investment, Infrastructure, and Grid Modernization
Global grid spending reached $390 billion in 2024, up 20% since 2022. Yet transmission and distribution investment still lags behind renewable build-out requirements.
To bridge this gap, stakeholders must focus on:
- Upgrading aging infrastructure to handle variable renewable inputs.
- Deploying smart grid technologies and digital controls.
- Crafting policies that encourage unlocking private and public capital for long-term projects.
Public-private partnerships, blended finance mechanisms, and risk-sharing instruments can mobilize the necessary resources to reinforce grid resilience.
Energy Justice and Just Transition
As the low-carbon economy accelerates, ensuring equitable outcomes is paramount. Displaced workers and affected communities require targeted support to thrive in new sectors. Programs that retrain coal-mining employees for renewable installation, or that incentivize local manufacturing of turbines and panels, anchor economic revitalization.
Integrating community voices in planning processes and maintaining ensuring equitable access to energy are vital to sustaining social license and maximizing public buy-in.
Sectoral Focus: Power, Mobility, Industry
In the power sector, solar and wind lead decarbonization efforts, buttressed by energy storage, demand response, and microgrids. Collaborative R&D can drive next-generation batteries and grid-forming inverters.
The transportation revolution is under way: electric vehicles (EVs) now comprise over 15% of new car sales in leading markets. Incentives, charging infrastructure, and battery recycling initiatives reinforce global leadership of China in EV markets and inspire replication worldwide.
Industry’s transition hinges on process innovation, fuel-switching to hydrogen, and CCUS retrofits. Pilot projects in steelmaking and cement production demonstrate pathways to slash emissions by over 30% in the coming decade.
Policy, International Cooperation, and COP30
COP30 negotiations underscore the urgency of embedding a fossil-fuel phase-down roadmap in global agreements. While some parties resist explicit language, a coalition of nations is championing clear targets and financing mechanisms.
Effective policy design—encompassing carbon pricing, renewable mandates, and streamlined permitting—is complemented by technology transfer agreements and capacity-building partnerships. International cooperation is vital to align incentives and share best practices.
Future Outlook: Charting the Path to 2060
Electricity demand is projected to rise 120% by 2060, climbing from 21% to 43% of global energy consumption. Renewables are poised to supply up to 41% of primary energy by 2050 under high-ambition scenarios.
Hydrogen, while constrained by cost and infrastructure today, offers a versatile energy carrier for industrial heat and long-distance transport. Storage technologies—from lithium-ion batteries to flow batteries and pumped hydro—will anchor the grid’s reliability.
The convergence of innovation, finance, and policy will define whether the world meets its net-zero ambitions in time to avert the worst impacts of climate change.
Collective action from governments, businesses, and citizens can drive a seamless transition. By embracing proven technologies, supporting affected communities, and forging international partnerships, we can move collective action fuels progress toward a cleaner, more prosperous future.
