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Fostering Effective

Energy Transition

2023 Edition

INSIGHT REPORT

JUNE 2023

In collaboration

with Accenture

Images: Getty Images

reserved. No part of this publication may

be reproduced or transmitted in any form

or by any means, including photocopying

and recording, or by any information

storage and retrieval system.

Disclaimer

This document is published by the

World Economic Forum as a contribution

to a project, insight area or interaction.

The ﬁndings, interpretations and

conclusions expressed herein are a result

of a collaborative process facilitated and

endorsed by the World Economic Forum

but whose results do not necessarily

represent the views of the World Economic

Forum, nor the entirety of its Members,

Partners or other stakeholders.

Contents

Foreword 3

Executive summary 4

1 Introduction 6

2 Framework 8

3 Overall results 11

3.1 Transition scores 13

3.2 Transition momentum 15

4 Sub-index and dimension trends 19

4.1 System performance 20

4.2 Transition readiness 30

4.3 A closer look at innovation 31

5 Conclusion 33

6 Country performance proﬁles 34

Appendices 61

A1 Methodology 61

A2 Country ETI score evolution, 2014-2023 62

Contributors 64

Endnotes 66

Fostering Effective Energy Transition: 2023 Edition 2

Foreword

The transformation of the global energy system is

well under way. In just over a decade, investments

across multiple forms of renewable energy have

overtaken investments in fossil fuels. Energy and

climate policies now take centre stage in domestic

and international affairs. The geopolitical balance

of energy has shifted signiﬁcantly, and new

superpowers have emerged in renewable energy

component manufacturing, critical minerals and

clean technology. The frontiers of energy innovation

have been progressively redeﬁned, and thousands

of entrepreneurs are working to remake this huge

industry. Enabled by mounting scientiﬁc evidence,

a steady rhythm of extreme weather events

and decades of awareness campaigns, climate

consciousness is embedded in the public psyche.

The Energy Transition Index (ETI) has supported

decision-makers through this period, with a robust,

consistent and comprehensive framework and a

transparent fact base.

Despite the strong momentum, the energy transition

has been challenged by near-term exigencies.

Following the COVID-19 pandemic, a combination of

economic factors and supply chain constraints led

to affordability challenges, shortages and blackouts

in different parts of the world. The recent energy

crisis, a result of the Russia-Ukraine war, is the most

severe in decades, leading to the highest levels

of inﬂation in decades, a cost-of-living crisis and

macroeconomic instabilities. While investments and

policy measures for energy transition have ampliﬁed

despite the volatile environment, the delicate

balance of the energy security architecture, and

the adverse effects on vulnerable households and

developing countries, demonstrate the importance

of balancing the imperatives of security, equity and

sustainability for an effective energy transition.

Considering today’s context, we have updated

the ETI framework to ensure its usefulness for

decision-making. The revisions include the improved

delineation of inclusiveness and equity, the

reprioritization of energy security, the sharpening of

the enabling environment scope, and the articulation

of transition momentum to complement energy

system performance and transition readiness to

provide an in-depth view of how fast or slow a

country is transitioning, beyond the snapshot values.

The actions taken in the early years of this decade of

delivery will be critical in ensuring that strong, long-

term ambition is supported by immediate progress.

The focus needs to be on enhancing an equitable

transition which has been traded off rather than

enabled by the focus on security and sustainability.

The energy transition must be made resilient to

maintain speed under current volatilities and during

potential future domestic or international disruptions.

Resilience needs to be built into the transition to

maintain progress throughout ongoing and future

disruptions as COVID-19 and the energy crisis will

not be the only international events in the coming

decade and beyond.

Through this effort, the World Economic Forum

encourages the sharing of best practices and

the use of its platform for effective public-private

collaboration to facilitate the energy transition

process around the world.

Muqsit Ashraf

Global Strategy Lead,

Accenture

Roberto Bocca

Head, Centre for Energy

and Materials; Member of

the Executive Committee,

World Economic Forum

Fostering Effective Energy Transition

2023 Edition

June 2023

Fostering Effective Energy Transition: 2023 Edition 3

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FosteringEffectiveEnergyTransition2023EditionINSIGHTREPORTJUNE2023IncollaborationwithAccentureImages:GettyImages©2023WorldEconomicForum.Allrightsreserved.Nopartofthispublicationmaybereproducedortransmittedinanyformorbyanymeans,includingphotocopyingandrecording,orbyanyinformationstorageandretrievalsystem.DisclaimerThisdocumentispublishedbytheWorldEconomicForumasacontributiontoaproject,insightareaorinteraction.Thefindings,interpretationsandconclusionsexpressedhereinarearesultofacollaborativeprocessfacilitatedandendorsedbytheWorldEconomicForumbutwhoseresultsdonotnecessarilyrepresenttheviewsoftheWorldEconomicForum,northeentiretyofitsMembers,Partnersorotherstakeholders.ContentsForeword3Executivesummary41Introduction62Framework83Overallresults113.1Transitionscores133.2Transitionmomentum154Sub-indexanddimensiontrends194.1Systemperformance204.2Transitionreadiness304.3Acloserlookatinnovation315Conclusion336Countryperformanceprofiles34Appendices61A1Methodology61A2CountryETIscoreevolution,2014-202362Contributors64Endnotes66FosteringEffectiveEnergyTransition:2023Edition2ForewordThetransformationoftheglobalenergysystemiswellunderway.Injustoveradecade,investmentsacrossmultipleformsofrenewableenergyhaveovertakeninvestmentsinfossilfuels.Energyandclimatepoliciesnowtakecentrestageindomesticandinternationalaffairs.Thegeopoliticalbalanceofenergyhasshiftedsignificantly,andnewsuperpowershaveemergedinrenewableenergycomponentmanufacturing,criticalmineralsandcleantechnology.Thefrontiersofenergyinnovationhavebeenprogressivelyredefined,andthousandsofentrepreneursareworkingtoremakethishugeindustry.Enabledbymountingscientificevidence,asteadyrhythmofextremeweathereventsanddecadesofawarenesscampaigns,climateconsciousnessisembeddedinthepublicpsyche.TheEnergyTransitionIndex(ETI)hassupporteddecision-makersthroughthisperiod,witharobust,consistentandcomprehensiveframeworkandatransparentfactbase.Despitethestrongmomentum,theenergytransitionhasbeenchallengedbynear-termexigencies.FollowingtheCOVID-19pandemic,acombinationofeconomicfactorsandsupplychainconstraintsledtoaffordabilitychallenges,shortagesandblackoutsindifferentpartsoftheworld.Therecentenergycrisis,aresultoftheRussia-Ukrainewar,isthemostsevereindecades,leadingtothehighestlevelsofinflationindecades,acost-of-livingcrisisandmacroeconomicinstabilities.Whileinvestmentsandpolicymeasuresforenergytransitionhaveamplifieddespitethevolatileenvironment,thedelicatebalanceoftheenergysecurityarchitecture,andtheadverseeffectsonvulnerablehouseholdsanddevelopingcountries,demonstratetheimportanceofbalancingtheimperativesofsecurity,equityandsustainabilityforaneffectiveenergytransition.Consideringtoday’scontext,wehaveupdatedtheETIframeworktoensureitsusefulnessfordecision-making.Therevisionsincludetheimproveddelineationofinclusivenessandequity,thereprioritizationofenergysecurity,thesharpeningoftheenablingenvironmentscope,andthearticulationoftransitionmomentumtocomplementenergysystemperformanceandtransitionreadinesstoprovideanin-depthviewofhowfastorslowacountryistransitioning,beyondthesnapshotvalues.Theactionstakenintheearlyyearsofthisdecadeofdeliverywillbecriticalinensuringthatstrong,long-termambitionissupportedbyimmediateprogress.Thefocusneedstobeonenhancinganequitabletransitionwhichhasbeentradedoffratherthanenabledbythefocusonsecurityandsustainability.Theenergytransitionmustbemaderesilienttomaintainspeedundercurrentvolatilitiesandduringpotentialfuturedomesticorinternationaldisruptions.ResilienceneedstobebuiltintothetransitiontomaintainprogressthroughoutongoingandfuturedisruptionsasCOVID-19andtheenergycrisiswillnotbetheonlyinternationaleventsinthecomingdecadeandbeyond.Throughthiseffort,theWorldEconomicForumencouragesthesharingofbestpracticesandtheuseofitsplatformforeffectivepublic‑privatecollaborationtofacilitatetheenergytransitionprocessaroundtheworld.MuqsitAshrafGlobalStrategyLead,AccentureRobertoBoccaHead,CentreforEnergyandMaterials;MemberoftheExecutiveCommittee,WorldEconomicForumFosteringEffectiveEnergyTransition2023EditionJune2023FosteringEffectiveEnergyTransition:2023Edition3ExecutivesummaryThefrontiersoftheglobalenergytransitionareconstantlyshiftingascountriesattempttoemergeoutofvarioushealth,geopoliticalandeconomiccrises.The“polycrisis”hasforcedcountriestoreallocateresourcesandimplementmeasurestoaddressnear-termenergysecurityandaffordabilityconstraints.Ithasalsoprovidedanopportunitytothinkabouthowvariousaspectsofthe“energytriangle”haveevolved.Equityandinclusivenessevolvedfromfocusingonlyonaccesstoembracingsustainedeconomicdevelopment.Securitytookaleapfromensuringsuppliestowardsdiversifyingtheenergymix.Andsustainabilitynowincludesawiderformofcleanenergybeyonddecarbonization,whereastransitionreadinessdemandsmorefocusonregulatoryandfinancialenvironments.Consideringthechangingneedsoftheenergyfrontier,theEnergyTransitionIndex(ETI)frameworkhasbeenrevisedthisyeartoincorporateawiderapproachofbalancingthethreeimperativesoftheenergytriangle–equity,securityandsustainability–whileharnessingtransitionenablerseffectively.TheETIbenchmarkscountriesontheircurrentenergysystemperformanceandprovidesaforward‑lookingmeasureoftransitionreadiness.Overthepastdecade,theglobalETIscoresimprovedby10%,supportedbyanincreaseof19%intransitionreadinessscores,butonlya6%increaseinsystemperformancescores.TheNordiccountries(Sweden,Denmark,NorwayandFinland)continuetomaintaintheirtoprankings,scoringhighlyonbothsystemperformanceandtransitionreadiness.Afewcountries,suchasKenyaandAzerbaijan,jumpedsignificantlyinrankthisyearformakingaggressiveeffortstowardstransitionreadinessbyimprovingtheirregulatoryenvironmentandinfrastructure.Importantly,inthelastdecade,theworld’slargestenergyconsumer,China,gained43%–approximatelydoubletheglobalaverage–initstransitionreadinessscores,makingitswayintothetop20astheonlyAsiancountry.Thisreportspotlightscertaincountriesaccomplishingnoticeableachievementsorlayingthegroundworkforarobustenergytransition(seesection6).Thiseditionofthereportrefocusesontheneedforurgentactiontowardsthetransition.Despitemakingprogressondecarbonizationandimprovingoninfrastructure,theworldstillfallsshortofachievingbalancedprogressonallaspectsoftheenergytriangle.Thus,“transitionmomentum”hasbeenincorporatedasameasuretodeterminecountryprogressonthesystemperformanceparameters.Onlytwocountries–IndiaandSingapore–aremakingadvancesonallaspectsofenergysystemperformance.Thewindowofopportunityfortheenergytransitionisclosingfast.Thelimitednumberofcountriessimultaneouslyadvancingacrossallaspectsoftheenergytrianglehighlightsthechallengesthatcountriesfaceinprogressingalongtheirenergytransitionpathways.Thefollowingthemesemergefromanalysingthedriversofpastprogressthatcanhighlightthepathforanacceleratedtransition:Thecurrentenergytransitiontrajectoryputsequityunderpressure.TheglobalaverageETIscorehasincreasedeachconsecutiveyearoverthelastdecade,butthegrowthhasplateauedinthepastthreeyears,duetorisingchallengestotheequityandinclusivenessofthetransition.Energymarketvolatilitiesresultingfrommacroeconomicandgeopoliticaldevelopmentsoverthepastthreeyearshaveledtoextremepriceshocks,exacerbatingenergypovertyandstallingenergyaccess.Highfuelpriceshaveaffectedthecost-competitivenessofenergyintensiveindustries,andtherisingsubsidyburdenposesarisktoeconomicgrowth.Low-incomecountrieshavebeendisproportionatelyaffected,facingsimultaneouschallengesfromfuelpriceinflation,foodinflationandrisingdebtburden.Whileperformanceonenvironmentalsustainabilityhasgrownthefastestandcountriesareprioritizingenergysecurityafterlessonsfromtheenergycrisis,inclusivenessandequityconsiderationsneedtobeaddressedforarobustandresilienttransition.Thecentreofgravityforenergytransitionisshiftingtowardsemerginganddevelopingeconomies.Withincreasingpopulationsandeconomicgrowthindevelopingcountries,particularlyChinaandIndia,theglobaldemandforenergyremainsunfazed.Short-termeffectsfromtheenergycrisisnotwithstanding,allemergingeconomiesshowconsistentimprovementontransitionreadiness,performingbetterthantheglobalaveragesoveralonger-termhorizon.Theimprovementsinthegrowthofcleanjobs,infrastructuredevelopment(includingtheadditionofrenewablescapacity)andpoliticalcommitmentshavebeensignificant.Evenastheglobalenergytransitionisplateauingduetoequitychallenges,majoreconomiesareshowingsignificantprogress.FosteringEffectiveEnergyTransition:2023Edition4Anopportunityalsoliesinthecosteffectivenessofimplementingcleansolutionsinemergingeconomies,astheaveragecostofreducingemissionsintheseeconomiesisestimatedtobeapproximatelyhalfofthatinadvancedeconomies.Allofthis,however,mustbeaccompaniedbyimprovingtheenergyintensityoftheeconomy,whilereducingthecarbonintensityoftheenergymix.Further,directinginvestmentstowardsdevelopingeconomiescanhelpthemboostacceleration.Noone-size-fits-alldimensionsexistforallcountries.Thecountriesperformingstronglyontheequitabledimensionhavebeenabletomanageaffordabilityconcernsduetolessrelianceonenergyimportsandcostreflectiveenergypricing.Oman,Canada,UnitedStatesandSwedenaretopscorersonthisdimension.ChronicenergyaccesschallengesarereflectedinthelowscoresofDemocraticRepublicofCongo,Zambia,TanzaniaandSenegalonthisdimension.Thetopscorersinthesecuredimensionaremainlyadvancedeconomies,suchasUnitedStates,AustraliaandEstonia,followedbyMalaysia,adevelopingcountry.Allthesecountrieshaveahighlydiversifiedenergymix,minimaldependenceonfuelimportsandminimalinterruptionsinenergysupply.ThecountriesscoringthelowestareLebanon,JamaicaandDominicanRepublic,mainlybecauseofchallengesonthediversityoftheenergymix,theneedforenergyimportsandelectricitylosses.LatinAmericaleadsthechartonthesustainabledimensionwithCostaRica,ParaguayandUruguay,onaccountofabundanthydroelectricpotential.FossilfuelexportingcountriesBahrain,Kuwait,OmanandQatarscorethelowestonthisdimension,attributedtohighenergyandcarbonintensitiesandaverylowshareofcleanenergyinthemix.Theseresultsinferthat,irrespectiveofeconomicdevelopment,countriescanharnessdifferentavailableresourcestosuccessfullytransitiononvariousaspectsoftheenergytriangle.Renewableenergydeploymenthasgrownexponentially,thoughinnovationinnext-generationenergytechnologiesisnecessary.Despitethefastestgrowthamongthethreedimensionsoftheenergytriangle,theglobalaveragescoreonthesustainabledimensionlagsthescoresoftheequitableandsecuredimensionsonanabsolutescalethroughoutthepastdecade.Thesilverlining,however,camein2022withinvestmentsinrenewablesreachingarecordhighof$1.3trillion,a19%increasefrom2021investmentlevelsanda70%increasefrompre-pandemiclevelsin2019.Aroundtheglobe,countrieshaveaddedtotheirrenewablecapacities.Onereasonforthisisthewideavailabilityandmaturityofrenewabletechnologies.Toincreasethesupplyofcleanenergyanditsassociatedtechnologies,theinnovationlandscapeofcleanenergysolutionsmustbeboosted,includingalternativefuels,hydrogen,andcarboncaptureandsequestration.Policiesarepavingthewayforaprogressivetransition,anddiligencewithimplementationwouldshapeupthetransitiontrajectory.Withupdatedcountrycommitments,globalgreenhousegasemissionscoverageincreasedfrom69%to77%.Acombinationofrecentpolicies,suchastheUSInflationReductionAct,Japan’sGreenTransformationprogramme,theEuropeanUnion’sCarbonBorderAdjustmentMechanism,andevolvingmandatoryandvoluntarycarbonmarkets,areacceleratingcleanenergysupplyandtechnologyscalability,andpromotingdemandefficiencywhileallowingfortransition-orientedeconomicgrowth.Thetransitiontrajectoryhingesonthequalityofimplementingthesepoliciestostimulateinvestmentsinenablingthetransitioninfrastructure,whileavoidingunintendedconsequencesonenergyequityandglobaltrade.Increasingfinancingforalow-carbonenergysystemrequiresconcertedeffortsfromgovernments,emphasizingastrongpolicyandpricetoensuregreeninvestmentsofferanattractiverisk-adjustedreturn.FosteringEffectiveEnergyTransition:2023Edition5Introduction1Recentcriseshaveleftcountriescontinuallystrugglingtobalanceenergysecurity,equityandsustainability.Theenergytransitionisatacriticalinflectionpointamidaseriesofshockswithcompoundingeffects(Figure1).EnergysuppliesandinfrastructurehavebeenheavilyweaponizedduringtheRussia-Ukrainewar,exposingthevulnerabilitiesoftheenergysecurityarchitecture.Countrieswithotherwisematureenergyinfrastructureandsophisticatedsupplychainswereforcedtoresorttoemergencymeasurestoensureadequateenergysupply.FollowingthedisruptionofpipelinegassupplyfromRussia,acombinationofstrongpolicymeasures,alternativefuelsupplyagreements,acceleratedliquefiednaturalgas(LNG)infrastructuredevelopment,demandmanagementandcurtailment,regionalcollaborationontheuseofstoragereserves,andamilderthanexpectedwinterhavehelpedEuropeavoidenergyshortages.Simultaneously,aconcentratedfuelmix,relianceonfewtradepartnersandunderinvestmentinenergysystemsemergedasimportantriskfactors.Asaresult,oilandgasflowsmayhavebeenpermanentlyredirected,leadingtothemostsignificantrebalancingoftheenergygeopoliticallandscapesincethe1970s.Gasmarketvolatilitiesspilledovertoelectricitymarkets,promptingconsiderationsforelectricitymarketreforms.CompetitionforscarceLNGcargoesgloballyledtosomeemergingeconomiesbeingpricedout,resultinginblackoutsinPakistanandBangladesh.Therecentenergycrisisisthefirstwithaglobalscopeduetointerconnectedenergysupplychainsandcallsforcomprehensiverethinkingofenergysecuritystrategyinthefaceoftheemergingriskslandscape.Thecrisishasalsoshownthat,underpressureandledbystrongpolicymeasures,fasterenergysystemchangesarepossible,asseenwithEurope’sdiminisheddependenceonRussiangas.Theglobalenergycrisisalsohighlightedmultipledimensionsoftheinclusivenessoftheenergytransition.Theunprecedentedsurgeinenergypricesseverelyaffectedaffordability,withpoorhouseholdsthatspendalargerportionoftheirincomeonenergyaffectedthemost.Highenergypricessparkedfoodinflation,leadingtoacost-of-livingcrisisinmanycountries.Energymarketvolatilitiesalsoaffectedthecompetitivenessofenergy-intensiveindustriesinsomeregions.Increasingly,firmsareseekingtoshiftoperationstomarketswithcheaperandmorereliableenergy,raisingconcernsoveremploymentinlocalcommunities.Thefiscalresponsetomitigatetheeffectsoftheenergycrisisonconsumersandbusinessesimposedaheavyfinancialburdenongovernments,withestimatesoffossilfuelsubsidiesinexcessof$1trillionin2022.1Emergingeconomies,alreadydealingwithpriceshocks,areunderanincreasingdebtburdenduetomonetarypolicyresponsestocontrolinflation.Thisexacerbatesthechallengeofattractinglow-costcapitalonalargescaletofinancetheenergytransitioninemergingeconomies.JustEnergyTransitionPartnerships(JETPs)haveemergedasnovelbilateralarrangementstosupportcoal-dependentemergingeconomiesinacceleratingthephase-outoffossilfuelswhileaddressingsocialimpacts.Themarchofsustainableenergyhaskeptpacethroughthisperiodofextremevolatility.Lastyear,forthefirsttime,investmentsinlow-carbonenergytechnologiessurpassedarecord$1trillion.2Bilateralfinanceflowsandearly-stagefinancingcontinuedtogrow,andglobalclimatetechventurecapitalfundingtotalled$82billion.3Inresponsetotheenergycrisis,landmarklegislationswereputforward,includingtheUSInflationReductionAct,whichwaspassed,andtheproposedEUNet-ZeroIndustryActtorampupcleanenergy,driveinnovationandsetthesceneforaccelerateddecarbonization.Theelectricvehiclemarketsawrecordgrowthasunitsalessurpassed10millionin2022and14%ofnewcarssoldwereelectric.4Morecompaniesarecommittingtonetzero.AsofJune2022,702oftheworld’slargestfirmshadsetnet-zerotargets5thoughcredibilitygapsremain,leadingtoincreasingscrutinyonthevalidityoftargetsandaccountabilityofimplementation.Post-pandemicrecoveryofenergydemandandtheenergycrisismayhaveledtoareboundincoal,withtheslowestrateofcoalplantclosuresineightyears.6ThelatestIntergovernmentalPanelonClimateChangereportwarnsthatemissionsneedtobecutbyalmosthalfby2030tolimitwarmingto1.5°C.7Inlightofthesedevelopments,itisnowmoreimportantthaneverforcountriestofurtheracceleratetheirenergytransitioninawaythatbalancesanddeliversontheneedforanequitable,sustainableandsecureenergysystem,ensuringthatitisrightforthepresentandfuture.Policieswillbeatthecoreofshapingabalancedenergytransitionbyencouraginginvestmentsincleanenergy,promotinginnovation,encouragingenergyefficiencyandensuringthatthetransitionbenefitsallsegmentsofsociety.Thecrisishasalsoshownthat,underpressureandledbystrongpolicymeasures,fasterenergysystemchangesarepossible.FosteringEffectiveEnergyTransition:2023Edition6Volatileperiodintheenergytransition,2020-2022FIGURE1202220212020KeyshocksEffectsMilestonesMissedopportunitiesEightcountriesreachednet-zeroemissions–USInﬂationReductionAct–EUNet-ZeroIndustryAct–EUFitfor55package–JapanGreenTransformationprogramme–FirstMoversCoalitionGlobalinvestmentinlow-carbonenergytechnologysurgedto$1.1trillion(biggestsharetowardsrenewablesandelectriﬁedtransport)TemporarybehaviouralchangesinsteadofstructuralreformstokeepemissionslowDropinglobalenergy-relatedCO2emissionsby5.8%Reboundinglobalenergy-relatedCO2emissionsby6%(36.3billiontonnes)Fossilfuelsubsidiesatall-timehigh($1trillion)EnergypovertyandlossofindustrialcompetitivenessSupplychaindisruptionsandsupplyshortagesEnergysecurityvulnerabilitiesandsupplychaindisruptionsGlobalenergyinvestmentplummetedby$400billionGovernmentsupportforfossilfuelsin51countriesdoubledto$697billionAverageglobaltemperature1.1°Cabovepre-industriallevelsPresentationofEUClimateTargetPlanTheworldcommittedarecord$501.3billiontodecarbonizationSolarpowerbecamethecheapestsourceofelectricityglobally($0.048/kWh)LackofincentivestotheprivatesectortoinvestincleanelectricityOnly6%oftheG20’srecoveryfundingchannelledtowardscleanenergyExtremeweathereventsRussia-UkrainewarInﬂationLaunchofJustEnergyTransitionPartnerships(JETPs)andtheFirstMoversCoalitionRecord295GWofnewrenewablepowercapacityaddedAnnouncedstimulusof$17.2trillionwillhaveanetnegativeenvironmentalimpactin15oftheG20countriesOngoingsubsidizingofcoal,oilandnaturalgasandlackofstructuralreformsandboldactionstophaseoutfossilfuelsinpowergenerationandexpandenergyefﬁciencyandrenewablepowerCOVID-19StructuralchangestoglobalcrudeoilmarketsandpricingsystemDropinenergydemandby4%worldwideDropinenergycommoditypricesby40%Globaleconomyshrankby5.2%Reboundinenergydemandandconsumption5%worldwideTighteningofenergymarketspushedcoal,oilandgaspricesup(80%)Majoroutagesaffecting350millionpeopleworldwideSurgeincrudeoilpricesto$100/barrelinmid-2022beforefallingbackPricesforspotpurchasesofnaturalgasexceedequivalentof$250/barrelofoilIncreaseinnumberofpeoplewithoutaccesstoelectricity(770million)afteryearsofdecreaseElectricitycostsupby30%GlobalenergycrisisSource:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition7Framework2TheETI2023featuresarevisedframeworkforeffectivedecision-makingintheevolvingglobalenergylandscape.FosteringEffectiveEnergyTransition:2023Edition8TheETIprovidesadata-drivenframeworktomeasureandunderstandtheperformanceofenergysystemsandreadinessforenergytransitionacrosscountriesfocusingonthetransition.Giventheemerginglandscapeanditspotentialimplicationsforenergytransitiondecision-making,theETIframework(Figure2)hasbeenupdatedtoensurerelevanceandusefulnessformakingdecisions.Whiletheenergytriangleremainsvalid–withabalancedapproachtowardsthethreeprioritiesofequity,securityandsustainability–theupdatedETIframeworkidentifiesspecificcomponentsofthesedimensions.Theequitabledimensionoftheenergytriangleisrootedinseveralaspects.Itaimstoensureaffordableaccesstomodernandcleanformsofenergyforall.Itfocusesonprovidingcontinuityofeconomicactivitiesthroughcompetitiveenergyprices.Italsoemphasizesmaintainingcost-reflectiveenergypricingwhileimplementingmechanismstoprotectvulnerableconsumersandsmallbusinesses.Inaddition,itleveragesthegreengrowthmomentumtocreatesharedprosperity.Lessonsfromtherecentenergycrisisarereflectedinthedefinitionofthesecuredimension.Supplysecuritythroughdiversificationremainsimportantacrossthreeleversofdiversification–intheenergymix,intheirenergytradepartnersandinthesourcesofelectricitygeneration.Resilience,bothingassuppliesandthepowersystem,isinstrumentalforenergysecurity.Inaddition,asthenumberandrangeofpowergenerationandmanagementassetsincreaseasaresultofdecentralization,reliabilityofgridsbecomescritical.Futureiterationscanincludeothersourcesofresilience,suchassecuresupplyofcriticalminerals,differentformsofenergystorage,gridinterconnectionsanddemandresponseuponavailabilityofrobust,timelyandconsistentdata.Demand-andsupply-sidemetricsconstitutethesustainabledimension.Supply-sidesustainabilityrequiresthereductionofCO2andmethaneintensityofenergysupply.Inadditiontosupply-sidemeasures,effortstoreducetheenergyintensityoftheeconomy(thequantityofenergyrequiredperunitofoutputorproduct–abasicmeasureofenergyefficiency),toencourageresponsibleconsumptionthroughlowerenergyandemissionsfootprintpercapita,andtoincreasetheshareofcleanenergyinfinaldemand,areessential.Theprogressonenergytransitionisdeterminedbytheextenttowhicharobustenablingenvironmentcanbecreated.Arobustregulatoryframeworkandabilitytoattractanddeploycapitalonalargescaleremainthecorecomponentsofanenablingenvironment.Inadditiontoacomprehensivepolicyframeworkforrenewableenergy,energyefficiencyandenergyaccess,regulatoryframeworksneedtobealignedwitharobust,ambitiousandcredibleroadmaptonetzero,supportedbyefficientpricingofcarbon.Aninvestmentclimatecharacterizedbylowcostofcapital,liquidityindomesticmarketsandattractivenesstoforeigndirectinvestmentisastrongenablerformobilizingincreasinglevelsofcapitalfortheenergytransition.Additionally,advancedeconomiesneedtomeetthecommitmentofmobilizing$100billionofclimatefinanceannuallytodevelopingcountries.Energytransitionreadinessisincreasinglyshapingcountries’competitivenessstrategy,astheyincubatenascentindustriestosupportfutureeconomicgrowth.Factorssuchasaskilledworkforce,innovation,andphysicalanddigitalinfrastructureareessential,whichareexplicitlyacknowledgedaspartoftherevisedETIframework.MomentumInadditiontoimprovingsystemperformancethroughabalancedenergytriangleandcreatingarobustenablingenvironment,consistentprogressisessentialforatimelyandeffectivetransition.Thisreportproposes“momentum”assuchameasureforenergytransitiontoprovidecountrieswithanadditionallayerofbenchmarkingwithpeereconomies.Theideationofmomentumconsidersdifferentstartingpoints,country-specificcircumstancesandenergysystemstructures,andfocusesontheshort-termhistoricalgrowthrateoftheequitable,secureandsustainabledimensionsoftheenergysystem.Energytransitionreadinessisincreasinglyshapingcountries’competitivenessstrategy,astheyincubatenascentindustriestosupportfutureeconomicgrowth.9FosteringEffectiveEnergyTransition:2023EditionEnergyTransitionIndexupdate–performanceandreadinessFIGURE2SystemperformanceTransitionreadinessEducationandhumancapitalFinanceandinvestmentInfrastructureInnovationSustainableEquitableSecureRegulationsandpoliticalcommitmentCoreenablersSource:WorldEconomicForumTransitionmomentumFIGURE3AdvancingBelow-medianscore,withapositivegrowthrateLeadingAbove-medianscore,withapositivegrowthrateAtriskBelow-medianscore,withanegativegrowthrateStabilizingAbove-medianscore,withanegativegrowthratePositivegrowthrate(3-year)HighPerformanceLowPerformanceNegativegrowthrate(3-year)MomentumonthesystemperformancedimensionSource:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition10Overallresults3Amajorityofcountriesshowprogress,withdevelopingnationstakingcentrestageinashiftinggloballandscape.Keyhighlights14523GlobalaverageETIscoresincreasedby10%since2014,butshowedonlymarginalgrowthinthepastthreeyears.Thetop10countriesaccountforonly2%ofglobalCO2emissionsfromfuelcombustionand4%oftotalenergysupply.Only18%ofcountriesin2023havebalancedtheimperativesoftheenergytriangle.Only41countrieshavemadesteadyprogressinthepastdecade.Equitywascompromisedasthetransitioncentredonsecureandsustainable.Balancedisdefinedaswhenthespreadbetweentheequitable,secureandsustainablescoresislessthan8.5points.FosteringEffectiveEnergyTransition:2023Edition11EmerginganddevelopingEuropeMiddleEast,NorthAfricaandPakistanSub-SaharanAfricaLatinAmericaandtheCaribbeanCommonwealthofIndependentStatesAdvancedeconomiesEmerginganddevelopingAsiaETIScore201420232023GlobalAverage(56.3%)RankCountryETIscore(2014–2023)2023ETIscoreSP1('23)TR2('23)1Sweden78.581.074.82Denmark76.173.779.83Norway73.777.368.34Finland72.868.978.65Switzerland72.475.767.46Iceland70.673.965.67France70.673.366.58Austria69.369.269.59Netherlands68.865.773.510Estonia68.274.259.211Germany67.564.671.912UnitedStates66.368.463.213UnitedKingdom66.267.764.014Brazil65.968.961.315Portugal65.866.764.516Spain65.065.164.717China64.965.064.818Hungary64.368.857.519Canada64.266.760.320Luxembourg64.261.568.221Albania63.771.651.822NewZealand63.768.256.923Uruguay63.671.551.824Australia63.663.164.325CostaRica63.574.546.926Latvia63.469.055.127Japan63.363.762.928Israel62.767.355.729Slovenia62.668.054.430Chile62.563.461.331Korea,Rep.62.360.365.332Azerbaijan62.069.650.733Croatia62.067.054.434Paraguay61.972.945.335Malaysia61.770.049.336Lithuania61.262.060.137Greece60.960.361.738Italy60.663.955.639Colombia60.565.653.040Poland59.763.054.741Ireland59.361.356.342Belgium59.259.658.543VietNam58.960.356.944SlovakRepublic58.864.949.745CzechRepublic58.666.247.246Kenya57.865.945.647ElSalvador57.372.235.148Bulgaria57.262.848.949Romania56.865.843.350BosniaandHerzegovina56.760.351.451Panama56.466.241.752Cyprus56.461.748.453Peru56.470.734.954Thailand55.962.346.255Indonesia55.867.338.656Morocco55.660.748.157SaudiArabia55.362.045.358Namibia55.163.342.759Qatar55.058.250.260Mauritius55.065.439.4RankCountryETIscore(2014–2023)2023ETIscoreSP1('23)TR2('23)61Malta54.961.545.162Georgia54.864.041.063UnitedArabEmirates54.658.748.364Ukraine54.563.241.565Turkey54.358.947.466SriLanka54.363.540.667India54.361.443.668Mexico54.164.937.869Montenegro54.062.441.570Singapore53.751.257.671Jordan53.758.446.772Armenia53.660.044.173Tajikistan53.666.434.474Bolivia53.566.034.775Coted'Ivoire53.164.036.976Kazakhstan53.061.140.977Serbia52.961.140.578Ecuador52.867.830.279Egypt,ArabRep.52.462.537.280Macedonia,FYR52.361.438.781Cameroon52.265.432.482SouthAfrica52.256.645.583LaoPDR52.159.241.684Cambodia52.159.940.485Argentina52.063.135.586Algeria51.964.832.687Guatemala51.965.232.088Ghana51.563.134.189Tunisia51.458.141.590Oman51.358.640.391KyrgyzRepublic50.661.734.192Iran,IslamicRep.50.461.633.693DominicanRepublic50.355.442.794Philippines50.261.533.295Ethiopia49.861.132.796Gabon49.564.726.897Nepal49.258.235.798TrinidadandTobago48.356.835.799Angola48.164.024.4100Honduras48.059.630.5101RepublicofMoldova47.855.736.1102Kuwait47.851.342.5103Venezuela47.764.322.7104Senegal47.653.838.3105BruneiDarussalam47.355.035.7106Botswana46.954.934.9107Pakistan46.955.234.5108Nigeria46.058.427.5109Mozambique46.058.127.8110Bahrain45.752.036.3111Mongolia45.456.329.0112Lebanon45.250.137.9113Bangladesh45.056.827.3114Nicaragua44.957.126.6115Jamaica44.950.436.5116Zimbabwe44.750.735.7117Zambia44.356.725.8118Tanzania42.951.430.1119Congo,Dem.Rep.42.354.324.3120Yemen,Rep.40.056.315.5ETI2023rankingtableTABLE11Systemperformance2023;2Transitionreadiness2023Note:Theaveragescorefor2023is56.3.Source:WorldEconomicForum40506070803040506070FosteringEffectiveEnergyTransition:2023Edition12Allcountriesrankedinthetop10arefromWesternandNorthernEurope,andaccountfor2%ofenergy-relatedCO2emissions,4%oftotalenergysupplyand2%oftheglobalpopulation.Swedenleadstheglobalrankings,followedbyDenmarkandNorway.Amongtheworld’s10largesteconomies,onlyFrancefeaturesinthetop10.ThelistoftopperformersintheETIhasremainedbroadlyunchangedoverthecourseofthepastdecade.Althougheachcountry’senergytransitionpathwayisdifferent,theyallsharecommonattributes,including:–Reducedlevelsofenergysubsidies–Enhancedenergysecurityfromadiverseenergyandelectricitymix,aswellasamixofimportpartners–Improvedcarbonintensity–Increasedshareofcleanenergyinthefuelmix–Acarbonpricingscheme–AstrongandsupportiveregulatoryenvironmenttodrivetheenergytransitionHigh-rankingcountriesalsoshowhighscoresontransitionreadinessbecauseoftheirstronginstitutionalandregulatoryframeworks,theirabilitytoattractcapitalandinvestmentonalargescale,theirinnovativebusinessenvironmentandtheirhighlevelofpoliticalcommitmentonenergytransition.BothChinaandBrazilfeatureinthetop20,aresultoftheirperformancethusfarandreadinesstocontinuetotransition.TheglobalaveragescoresfortheETIhaveincreasedsuccessivelyeachyearfrom2014to2023,theresultofgainsacrossbothsystemperformanceandtransitionreadiness(Figure4).GlobalaverageEnergyTransitionIndexandsub‑indexscores,2014‑2023FIGURE40102030405060702014201520162017201820192020202120222023ETIoverallSystemperformanceTransitionreadinessSource:WorldEconomicForumOfthe120countries,113havemadeprogressoverthelastdecadebutonly55haveimprovedtheirscoresbymorethan10percentagepoints.Notably,largeemergingcentresofdemand,suchasChina,IndiaandIndonesia,haveseentheseimprovements.Only41countrieshavemadesteadygainsoverthelastdecade(definedasconsistentlyabove-averageperformanceimprovementsontheETI).Whilethislistincludesmanyadvancedeconomies,italsohas14countriesfromdevelopingandemergingEurope,developingandemergingAsia,andLatinAmericaandtheCaribbean.QatarandMexiconarrowlymissfallingintothecategory;theymadesteadygainsuntil2023whentheirprogressfellbelowtheaverage.Theseinsightsdemonstratethedifficultyofmaintainingprogressandtheenergytransition’sinherentcomplexity.Thetopimproversbetween2022and2023areAzerbaijanandKenya.KenyahastypicallyprogressedbehindtheglobalaveragewhileAzerbaijanhasbeenaheadofit.Bothhaveshownlargeimprovementsacrossseveraltransitionreadinessparameters,includingfinancialinvestment,infrastructureandinnovation.JoiningthemamongthetopimproversisParaguay,whichhasmadeprogresseveryyearforadecade,andZimbabwe,whosescoregrewby9%butcontinuestolagtheglobalaverage.Importantly,ascountriesadvance,theyshouldachieveabalancedenergysystem,butonly18%ofthemhaveachievedthisbalance,leavingthosewithoutitvulnerabletorisksrelatedtoenergysecurity,inequalityandtheconsequencesofclimatechange.Certainlargeemergingcentresofdemand,suchasChina,IndiaandIndonesia,haveimprovedtheirscoresbymorethan10percentagepoints.3.1TransitionscoresFosteringEffectiveEnergyTransition:2023Edition13Recentexperiencesunderlinehowcrucialasecure,affordableandsustainableenergysystemistoeconomicgrowth,andanorderlyandequitabletransition.Lookattheimpactthatrisingenergypriceshavehadonstokinginflation,whichhashitlow-incomefamiliesandsmallandmedium-sizedenterprises(SMEs)thehardest.Thisunderscorestheneedfortheenergytransition,whichtheWorldEconomicForumsupports,totacklethetrilemma:howdowegetenergythatislowcarbon,affordableandreliable,underpinningthegrowthneededtofinancethetransition.TheForum’sInternationalBusinessCouncil(IBC)haslaunchedaprojectthatcanharnessitsmemberscombinedeconomicimpact–130companiesrepresentingroughly3%ofglobalenergydemand–toacceleratetheenergytransition.Thisprojectisnotonlyachallenge,requiringcollaborativeactionacrosssectors,industriesandborders,butalsoanopportunitytofostergrowthandinfluencethewayoureconomiesandsocietiescanprovidesafer,fairerandmoresustainableoutcomes.Muchofthefocushas,understandably,beenonenergysupply.However,accordingtotheInternationalEnergyAgency’sNetZeroby2050pathway,tomeettheParisAgreement’semissionsgoalsby2050,theworldwillneedtoconsume8%lessenergythanitdoestoday.Atthesametime,theworld’seconomieswillneedtogrowinasustainablemannertoprovidefor2billionmorepeople.Thismeansthatenergyconsumptionasaportionofeconomicoutputaswellasthecarbonintensityoftheenergyindividualsconsumewillhavetodecline–thatis,peoplewillhavetobesmarterandmoreefficientintheirenergyuse.IBCmembershavedecidedtofocusonthedemandsideofenergytransition.Managingandreducingtheenergyintensityofdemandisanareawhereourcompanies,asleadersintheirsectorsandasstakeholdersintheirhomecountries,canfostermoreefficientuseofenergyandpromotepoliciesandpracticesthatcanleadtosuccess.Theaimistodothisinawaythatcomplements,ratherthanduplicates,othersimilarinitiatives,withinandoutsidetheForum’secosystem.First,supportedbyourknowledgepartnerPwC,theIBCwillcreateacommonvisionfordemand-sideenergytransition,withaneyetowardsreducingenergyconsumptionasaportionofGDPandcarbon-intensitywithinthatequation.Akeypartwillbehowwesupportemerginganddevelopingcountriestodothis.WewillsurveyIBCmemberstohelpidentifybestpractices,prioritiesandexistingplansandtargets,aswellasobstacles,whichwewilluseasabaselineforaction.Second,wewillengagegovernmentsandmultilateralstoadvocateforthepoliciesneededtoremoveobstaclesandpromotedemand-sideenergytransition,whilealsoexploringopportunitiestocontributetosectoraltransitionframeworks.IBCmembers,whoaregloballeadersintheirrespectiveindustriesandregions,areuniquelyplacedtohelpacceleratetheenergytransitionbycatalysingcompany,sectorandcountry-levelaction.Thecommunityhasanopportunitytoleverageitscollectiveinfluenceandconveningpowertoacceleratealow-carbon,secureandjusttransitionoftheglobalenergysystembybringingtogethertheprivatesector,governmentsandinternationalorganizations.Weknowthelimitsofaone-size-fitsallapproachbutarealsoconvincedwecansharesolutionsandefficienciesthatcanbeadaptedtohaveimpact.WewillnotforgettheimportanceofSMEsanddevelopingcountriesinthisregard.Wewillnotonlyseekwaystosupportandincentivizethem,butalsotounlockequityfinancingforthetransition.AllIBCmembersareaffectedbytheenergytransition,andarerelevantininfluencingit,bothasenergyconsumersandproducers.Banks,too,mustplayarole.Financingtheenergytransitionis,andwillcontinuetobe,oneofthemajorchallenges,andopportunities,forfinancialinstitutions.ThisisespeciallytrueinEurope,where70%ofbusinessfinancecomesfrombanks.Thetaskisdaunting,butthegoalisattainableifweworktogether.Throughcollaborationwithinthebusinesscommunity,thepublicandprivatesectorsandrelevantglobalbodies,wecanbuildanenergysystemthatislowcarbon,affordableandreliable.GUESTPERSPECTIVEBusinessisbackingtheacceleratedenergytransitionByAnaBotín,GroupExecutiveChair,BancoSantander;Chair,WorldEconomicForumInternationalBusinessCouncilFosteringEffectiveEnergyTransition:2023Edition14TheETIscoresmeasureacountry’scurrentenergysystem,butnothowfasttheyaretransitioning.Momentumshowswhoistransitioningthefastestandwhichcountriesareatrisk.Nogloballydefinedpercentageexiststhatdefinestheprogressoftheenergytransition.Thetransition’spacewilldependonavarietyoffactors,includingthespecificcontextofeachcountryorregion,theavailabilityofresourcesandtechnology,thelevelofpoliticalwillandpublicsupportandtheurgencyoftheclimatecrisis.Whatisknown,however,isthattheenergytransitionneedstoacceleratetolimittheeffectsofclimatechange.Figures5A-Cshowthedistributionofcountriesacrossfourquadrantsforeachsystemperformancedimension,dependingonthecurrentscoreandthethree-yeargrowthrateofthedimensionscorebetween2020and2023.Asaresult,countries’near-termfocusareasarevisibleaspositivecontributionstomomentum.Thefiguresassigneachcountrytooneoffourquadrants:–Leadingcountries–withabove-mediandimensionscoresandpositivegrowthrates–Stabilizingcountries–withabove-mediandimensionscoresbutnegativegrowthrates–Advancingcountries–withbelow-mediandimensionscoresandpositivegrowthrates–At-riskcountries–withbelow-mediandimensionscoresandnegativegrowthratesOnly2outof120countries–IndiaandSingapore–areadvancingacrosstheequitable,secureandsustainabledimensions,eachwithitsownuniquetransitionjourney.Thelimitednumberofcountriesmanagingsimultaneousadvanceonallelementsoftheenergytrianglehighlightsthechallengesmanycountriesfacewithbalancingeffortsandrequired,focusedinvestmentsandpolicychanges.Momentumfortheequitableandsecuredimensionsismoredispersedacrossthefourquadrantsduetothedimensions’previouslybeingnear-termfocusareasformanycountries.Theresultsshowthat62%oftheworld’spopulationnowresideinacountrythatisleadingoradvancingonanequitableenergytransition.Thesecountriesarepromotingenergyequityandaddressingsocialinequalityaswellasaddressingenergyaffordability.KenyaandTunisiaaredemonstratingstrongmomentuminthisdimension.Ontheotherhand,nearly20%oftheworld’spopulationlivesincountriesatriskofnotachievinganequitableenergytransition.Thesecountriesneedtoquicklyidentifychallengeareasandresolvethembyimplementinginfrastructureupgrades,subsidiesorsupportivepolicies.Countriesleadingoradvancingwithinthesecuredimensionhavefocusedonensuringadiverseenergymix,increasingresiliencetopricevolatilitiesandstrengtheninginfrastructure,includingimprovedgridstabilityandflexibility;BruneiDarussalam,GhanaandAlbaniaalldemonstratestrongmomentumhere.Eachcountry’sprogresstowardsamorediversifiedandsecureenergysystemisatdifferentstages,buttheyallhavefossilfuelsincommonastheirprimaryenergysource.Bruneihasfocusedondiversifyingitsenergysources,whileGhanaandAlbaniahavereducedimportsandimprovedenergyreliability.Althoughsomecountrieshaveestablishedsecureenergysystems,othersarestabilizingintermsofmomentumastheyshifttheirfocustootherareas.Allcountriesmustensurethattheyshifttocleaner,localelectricitygenerationandreducerelianceonfossilfuels(internalandimported).With11countriesbeingatriskonboththeequitableandsecuredimensions,specialattentionmustbegiventoidentifyblockers,andothercountriesshouldprovidetechnicalandfinancialsupporttomovethesecountriesbackontrack.Manycountriesareprioritizingsustainability,focusingonpoliciesandprogrammesthatpromoteenergyconservation,renewabletechnologiesandinnovationinenergystorageandgridmodernization.EstoniaandLuxembourghavebothdemonstratedstrongmomentum.Eachhasadifferentprofileintermsofsustainability,buttheyareallsignatoriestotheParisAgreement.Estoniahasprioritizedinvestmentinrenewables,andLuxembourginreducinggreenhousegas(GHG)emissions.SaudiArabiaisalsoadvancingwithinsustainabilitybut,consideringitsstartingposition,itneedstorapidlystepupthegrowthrateonsustainability.3.2TransitionmomentumMomentumisnotequalacrossdimensionsandcountriesareprioritizingsustainabilityforbalancedeconomicgrowth,socialwell-beingandnaturalresourcepreservation.KeyhighlightsOnly2outof120countriesareacceleratingacrosstheequitable,secureandsustainabledimensions.20%oftheworldismanifestingslowing(retracting)progressonenergyequity.Countriesaccountingforover90%oftheworld’semissionsareprioritizingsustainability.123FosteringEffectiveEnergyTransition:2023Edition15Thecountriesatriskwithinthesustainabledimensionaremajorfuelexportingnationswheretransitioningtosustainableenergysourcesmayrequiresignificantinvestmentandinfrastructureupgrades(whichcanbedifficulttoimplementinresource-richeconomies).Thesustainabilityandsecurityoftheenergysystemarecloselyintertwined,asanunsustainableenergysystemcanposealong-termthreattoenergysecurity.Byprioritizingsustainability,countriesareworkingtowardsachievingabalancebetweeneconomicgrowth,socialwell-beingandthepreservationofnaturalresources.MomentumacrosstheequitabledimensionMomentumacrossthesecuredimensionFIGURE5AFIGURE5BThree-yearcompoundannualgrowthrate(%)1015202530354045505560657075809085EmerginganddevelopingEuropeMiddleEast,NorthAfricaandPakistanSub-SaharanAfricaLatinAmericaandtheCaribbeanCommonwealthofIndependentStatesAdvancedeconomiesEmerginganddevelopingAsia10%ofenergysupplyAtriskAdvancing14%ofenergysupply14%energysupplyStabilizingLeading51%energysupply-6-5-4-3-2-1012345>62023securedimensionscoreThree-yearcompoundannualgrowthrate(%)1015202530354045505560657075809085EmerginganddevelopingEuropeMiddleEast,NorthAfricaandPakistanSub-SaharanAfricaLatinAmericaandtheCaribbeanCommonwealthofIndependentStatesAdvancedeconomiesEmerginganddevelopingAsia17%ofpopulationAtriskAdvancing36%ofpopulation11%ofpopulationStabilizingLeading26%ofpopulation-6-5-4-3-2-1012345>62023equitabledimensionscoreSource:WorldEconomicForumSource:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition16MomentumacrossthesustainabledimensionFIGURE5CThree-yearcompoundannualgrowthrate(%)-6-5-4-3-2-1012345>61015202530354045505560657075809085EmerginganddevelopingEuropeMiddleEast,NorthAfricaandPakistanSub-SaharanAfricaLatinAmericaandtheCaribbeanCommonwealthofIndependentStatesAdvancedeconomiesEmerginganddevelopingAsia4%ofemissionsAtriskAdvancing77%ofemissions<1%ofemissionsStabilizingLeading11%ofemissions2023sustainabledimensionscoreSource:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition17Regionalscoresandkeyinsights:Averagescoresbypeergroup–ETI2023FIGURE6AdvancedeconomiesOverthepastdecade,theETIscoresofadvancedeconomiesimprovedsteadilyby11%,ledbytheNordicregion.Alladvancedeconomieshavebeenabletoachieve100%accesstoelectricityanddevelopreliableenergysystems,butsufferedgreatlyonaffordabilitybecauseofhighenergypricesinthepastthreeyears.Thegroupmadetremendousadvancesonregulatorypolicies,infrastructure,humancapitalandfinancialinvestment,butlagsoninnovationwhereitcouldmakepioneeringdevelopments.Sub-SaharanAfricaSub-SaharanAfrica’senergytransitiongrowthof11%hasbeenoneofthemostpromisinginthelastdecade,anditisthestrongestperformerofallgroupsonthesustainabledimension.Oncertainparameters,suchasscoresforregulatoryindicatorsforsustainableenergy(RISE),creationofgreenjobs,andregulationandpoliticalcommitment,itwasalsothebestperformer.Sub-SaharanAfricashowedthemaximumgainof18%onscoresontheequitabledimensioninthepastdecade,butrecenttrendsshowaslowdown,aboutwhichtheregionshouldbecautious.Itneedstofocusonimprovingitsenergymixandharnessingitsabundanceofnaturalresourcestotransitionfastertoalow-carboneconomy.Thegroupcandosobyattractingglobalinvestments,leveragingpublic-privatepartnershipsandstrengtheningitsinfrastructure.MiddleEast,NorthAfricaandPakistanThescoresfortheMiddleEastandNorthAfricaandPakistangrewby8%inthelastdecadeandhavebeenflatforthepastthreeyears,wheretheheavyrelianceonoilrevenuescontinuestoposechallengesonthepathtoasustainableenergytransition.Eventhoughsubsidyscoresimprovedby200%–themaximumforanygroup–theyplunged33%inthelastyearalone.ThisgroupneedstocatchuponsustainablescoresbyreducingenergyintensityandshareofGHGemissions.Ontransitionreadiness,itwasatparwithothergroupswitha20%gainoverthelast10yearsbutshowedthemaximumdeclineoninnovation.Directingitsinvestmentstowardsdevelopmentofenvironmentaltechnologiescanhelponthisfront.LatinAmericaandtheCaribbeanThisgroupshowedtheslowestgain,withETIscoresincreasing5%overthelastdecade.Thegroupleadsonthesustainabledimensionduetoheavyuseofhydroelectricpower.Butsurprisingly,itsinvestmentinrenewablesscoresdeclinedby65%over10years.TheRenewablesinLatinAmericaandtheCaribbeaninitiative,createdattheendof2019,aimstofulfil70%ofthegroup’selectricenergyconsumptionwithrenewablesby2030.LatinAmericaproducesseveralmineralsnecessaryforcleanenergytechnologiesandcoulddevelopitsfirmlysetminingsectortodiversifyintonewminerals.Tounlockfurtherimprovements,thegroupcanstrengthenitsenablingenvironment,whereagainitshowedamodestgrowthofjust8%in10years.Itshouldfocusonleveragingitsadvantageinnaturalresourcestoboostinnovation,promotingpublic-privatepartnershipsforbettercreditaccess,andintroducingenvironmentaltaxreformsforlong-termbenefits.EmerginganddevelopingEuropeThisgroupshowedthemostpromisinggrowth,increasingETIscoresby13%overthepastdecade.Butproblemsmountedlastyearastheenergycrisishitthegroupthehardest,leadingtoadeclineinscores.Thewholesalepricesofelectricityandgashavesurged15-foldsincethebeginningof2021,severelyaffectinghouseholdsandbusinesses.Thegroupperformedwellontransitionreadiness,withagainof22%initsscores.Inthepastthreeyears,thegroupsignificantlyimprovedonaddingcleanenergyjobsandoninvestmentsinrenewables,whichwasreflectedinitsrenewablecapacityadditionscores.Intheshortterm,thesecountriesneedtofocusonreducingenergydemandandincreasingaffordabilityfortheirconsumers,whilecontinuingtostrengthentheirreadinessforthefuture.CommonwealthofIndependentStatesTheCommonwealthofIndependentStateswitnessedanimprovementinaggregateETIscoresby11%overthepastdecade.Butitssystemperformancescoresdeclinedlastyearwithanincreaseinsubsidiesandhighgasprices.Inthelast10years,thegroupwitnessedajumpof22%intransitionreadinessscores,butthatwaslimitedtoonly1.5%inthelastyear.Thecontributiontothelargeincreasecomesfromsignificantimprovementwithincleanenergyjobsoverthedecade,providinghopeandemploymentforapreparedgreenworkforce.Inthefuture,thegroupshouldfocusonimprovingenergyaffordabilityforitsconsumersandreducingfuelsubsidies,whichgrewbyahuge17%inthelastyear.EmerginganddevelopingAsiaEmerginganddevelopingAsia,hometothepopulouscountriesofIndiaandChina,improveditsETIscoresby12%inthelastdecade.Whilethisisoneoftwogroupsthathavemadegreaterthan10%improvementontheequitabledimensioninthepastdecade,itincreasedfuelsubsidiesdramaticallyinthelastyear.Performanceonthesustainabledimensionremainsflatwithworseningcarbonintensity.Thegroupshouldfocusonimprovingbothsecurityandsustainabilitygiventheenergydemandpercapitaisprojectedtodoubleby2050.Witha28%increaseinenablingenvironmentscores,theregionhasstrengtheneditspolicyframeworkandfinancingenvironment.Focusingoninnovation,addingmorerenewablecapacityanddiversifyingtheenergymixbymovingawayfromfossilfuelscanacceleratethetransitionforthisgroup.Source:WorldEconomicForum14%34%65.2Averagescore31%11%4%49.2Averagescore2%9%8%50.5Averagescore7%9%6%54.8Averagescore4%3%3%57.7Averagescore3%3%7%54.6Averagescore7%51%39%53.4Averagescore46%%ofglobalpopulation%ofglobaltotalenegysupply%ofglobalCO2emissions18FosteringEffectiveEnergyTransition:2023EditionSub-indexanddimensiontrends4Thecurrentenergytransitiontrajectoryismaskingadeclineinequityandinclusiveness.FosteringEffectiveEnergyTransition:2023Edition19Systemperformancedimensionscores,2014and2023FIGURE7Toachieveaneffectiveenergytransition,countriesmustbalancetheirenergysystemacrosstheequitable,secureandsustainabledimensions,andmakeprogressonall(Figure7).Inthelastdecade,83%ofthecountriestrackedbytheETIhaveimprovedtheirenergysystemperformance,anindicationoftheirstrongenergysystemgrowth.Globalaveragesystemperformancescoreshavesteadilyincreasedfrom59.5to63.0.Improvementpatternsdifferacrossdimensionshowever,ascountriesfacecompetingpriorities,economicuncertaintiesandgeopoliticalchallenges.Theglobalaveragescoreforsustainablein2023remainsthelowestamongthethreedimensions.Securehasprogressedthemost,narrowlyoutperformingsustainable,andtothedetrimentoftheequitabledimension,whichhasslowedoverall.Urgentandacceleratedmeasuresareneededtocontinuethenoticeableeffectonthesustainabledimensiontoensureabalancedenergysystem.Progresswithinsustainableisnoticeablylackingwithinthefossilfuel-exportingnations.Countries’evolutiononthesedimensionsoverthepastdecadeisfurtherexploredbelow.Percentageofcountries0%100%50%Dimensionscore(outof100)EquitableSecureSustainable10020304050607080901000%100%50%0%100%50%2023scores2014scores2023average4.1SystemperformanceSource:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition20EquitableTheimperativeoftheequitableenergytransitionstemsfromthecriticalroleplayedbytheenergysectorindrivingsocio-economicgrowth.Whiletheenergytransitionhasthepotentialtocreateeconomicopportunities,itcouldbringhighcostsandinequalitiesifnotmanagedproperly,particularlyfortheworld’smostvulnerablepopulations.Thisrequiresleaderstomakedifficultchoices,particularlyinemerginganddevelopingeconomies,tosupporteconomicgrowththatmaximizessocialwelfarewhileensuringaccesstoabundantanddiverseformsofenergyataffordableprices.TheETI’sequitabledimensiontrackstheaccess,affordabilityandeconomicdevelopmentoftheenergysector.Globallysince2014,thescorefortheequitabledimensionhasseena4%increase,witharecent3%increasefrom2021to2022anda4%declinefrom2022-2023followingmarketsignals,asshowninFigure8.Oman,Canada,theUnitedStatesandSwedenareleadingin2023,whilecountriesinSub-SaharanAfrica,includingtheDemocraticRepublicofCongo,Zambia,TanzaniaandSenegal,rankinthelowestquartile.Whileglobalaveragescoresonenergyaccessandeconomicdevelopmenthaveseengainssince2014,thoseforenergyaffordabilityhavesubstantiallydeclined(5%),owingtotheongoingenergycrisisandunprecedentedshocktoenergypricesandhouseholdexpenditures.Thesetrends,however,varybycountrydependingonthestageofeconomicdevelopment.Globaldemandandpricesforelectricityandoilsurpassedpre-pandemiclevelsin2021becauseofthestrongcorrelationbetweeneconomicgrowthandenergyconsumption.NaturalgaspricesalsoclimbedtotheirhighestinadecadeinEurope,theUnitedStatesandmajorAsianmarkets,owingtoacombinationofdemand-andsupply-sidefactors.Theseimbalancescarriedoverto2022withenergypricessustainingrecord-highlevelsduetotheRussia-Ukrainewar.Astheglobalenergycrisispersists,thesurgeinenergypricescontinuestofuelinflationarypressuresthatdeterinvestmentsincountriesalreadydealingwithhighinterestratesandgreatervolatility.Asaresult,energyaccessinvestmentsdwindlewhileaffordabilityofenergyservicesalsobecomesseverelyconstrained,addingtoconcernsoftheequityandjusticeoftheenergytransition.Estimatessuggestthataround75millionpeoplewhogainedaccesstoelectricityrecentlywilllikelylosetheabilitytopayforit,and100millionpeoplemaygobacktousingtraditionalbiomassforcooking.8ETItrendsshowthatwhiletherateofaccesstoelectricityinruralareasaswellasaccesstocleancookingfuelshasslowedinthepastthreeyears,electricitypricesremainhighacrossseveralregions,includingadvancedeconomies,emerginganddevelopingEurope,andtheMiddleEast,NorthAfricaandPakistan.Thisimpliesadifferentsetofaffordabilitychallenges,however,thanthoseinSub-SaharanAfrica.Toalleviatetheeffectsofhighelectricityprices,manycountriesintroducedlegislationandmeasuressuchastheregulationofwholesaleandretailprices;revenuecapsonrenewables,nuclearandcoalplants;reductionsinETIequitabledimensiontrend,2014-2023FIGURE85456586062646668Indexscore60.961.361.763.064.263.963.363.965.863.52014201520162017201820192020202120222023Source:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition21energytaxes;andenergysubsidies.Whilethesemarketinterventionscanhelpmitigatetheeffectsoftheenergycrisis,minimizinguncertaintyintheinvestmentlandscapeisrequiredtoensurethatthesemeasuresdonotdetermuch-neededinvestment.ETItrendsfurthershowthatfollowinganinitialdeclineinthelastfewyears,energysubsidieshavebeenreintroducedrapidlyandatmuchhigherlevels.Fossilfuelconsumptionsubsidiesworldwidesoaredin2022;oilsubsidiesincreasedbyapproximately85%,andnaturalgasandelectricityconsumptionsubsidiesmorethandoubled.9Eventhoughthesesubsidiesaremeanttoprotectconsumersfromvolatileenergyprices,theycreateanadditionalburdenongovernmentsamidtighteningfiscalspaceandspendingpressuresonotherprioritiesandreduceincentivesforconsumerstoadaptenergyconsumptiontopricelevels.Inthefaceofpersistingpricepressuresandcrisisconditions,thesemeasuresrequiresignificantcumulativeresources,whichposesseriousrisksfortheenergysectorparticularlyinemerginganddevelopingeconomies.Therisknowisaharmfulsubsidyracewhereadvancedeconomieswithgreaterfiscalpowermightemergeaswinners,andemerginganddevelopingeconomieswithscarcerfiscalresourceswouldfinditdifficulttocompetewiththemforinvestments.Thiscouldalsohinderthetransferoftechnologytothesenations,ultimatelyraisingthecostoftheenergytransition.10Forcountriesthatareunabletomakethosecommitments,thisraisesthequestionofhowtomaketheenergytransitioninclusive.Ifthegoalistoprotectconsumersfrompriceshockandtocorrectmarketfailures,acoordinatedapproachisrequired,allowingsubsidiestobetargetedtomeettheneedsofthepoorestandmostvulnerablenationsandhouseholds,andtoensurealevelplayingfield.SecureEnergysecurityis“aprimaryconcernforgovernmentsandeconomicplayersacrosstheglobe,andadimensionwhoseimpactsmultiplyacrosssupplychains,countriesandinternationalsystems.People,companiesandnationsdependonsecureanduninterruptedaccesstoenergyataffordableprices”.11TheETI’ssecuredimensiontracksenergysupply,reliabilityandresilience.Onaglobalscale,thesecuredimensionscoreshaveshownthemostprogressoverthepastdecade,althoughtheystilllagtheequitableandsustainabledimensions.Figure9showsthedimensionscoreovertime.Advancedeconomies,suchasUnitedStates,AustraliaandEstonia,scorehighlyduetomatureenergyinfrastructure,andmanyareabletowithstandpotentialdisruptionstogassupplychains.Malaysiascoreshighlyduetosupplydiversityandreliability.Majorfuelexporters,suchasSaudiArabia,UAEandAzerbaijan,alsoscorehighlyduetotheirgasreserves.ETIsecuredimensiontrend,2014-2023FIGURE95456586062646668Indexscore201420152016201720182019202020212022202362.162.064.765.265.365.665.766.166.266.6Thereisriskofaharmfulsubsidyracewhereadvancedeconomieswithgreaterfiscalpowermightemergeaswinners,andemerginganddevelopingeconomieswithscarcerfiscalresourceswouldfinditdifficulttocompete.Source:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition22Diversificationiscriticalforasecureandeconomicenergysystemasitreducesdependency,enhancesresilience,manageseconomicrisks,fostersinnovationandcompetitiveness,andsupportssustainabilitygoals.Countrieswithenergysecuritychallengeshavetypicallyfailedtodiversifyeithertheirdomesticenergymixortheirenergyimportpartners,orboth;someoftheresultshavebeenseeninrecentmonthsinEurope.TheETIshowsthatoutof29advancedeconomies,eighthavefuelimportdependencyonjustthreetradepartnersforover70%oftheirnetenergyimports.SevenoftheseeightcountriesareinEurope.Threelevelsareneededforimpactfuldiversification:intheenergymix,electricitysupplyandconsumption.TheirimportanceisrecognizedbyseveraloftheUnitedNation’sSustainableDevelopmentGoalsdirectlyorindirectlyrelatingtoelectricityandenergydiversificationandconsumption.TrendsfromtheETIshowthatenergydiversificationismoreadvancedthanelectricitydiversification,withprogressbeinguneven;whiletheelectricitymixisprogressing,theenergymixremainsstable.Somecountriesthathavesuccessfullydiversifiedtheirenergyandelectricitymixesmaynowfocusonimprovingqualityandreliabilityandreducingenergycosts.ManycountriesintheSub-SaharanAfricaandtheMiddleEast,NorthAfricaandPakistanregions,however,mayneedtofirstaddressenergyaccesschallengesbeforetacklinggridinfrastructureimprovementsandsubsequentdiversificationefforts.Policiesalsohaveanimportantroleindrivinginnovationandexpansionandinshapingenergysystemstoaccommodatenewtechnologies.The2022energycrisisincentivizedrenewableenergyovergasinthemediumterm.Moreincentivesmaybeneededtoshiftenergydemandpermanentlytowardscleanenergyandtoaccelerateelectrification.Energysystemsneedto“withstandoperationaldisturbances,suchasgridoutages,plannedmaintenance,extremeweathereventsorfinancialshocks(e.g.pricevolatility).Stabilityenhancementswhichstrengthenthereliabilityandresilienceofthesystemhaveneverbeenmoreimportantormorechallenging”.12Forcemajeureevents,includingcoldsnapsinNewYork,13heatwavesinJapan,14andearthquakesinTurkey15andSyria,haveshowncountriesthatgridoperationsneedtobeabletorecoverquicklyintheeventoftail-riskscenarios.Asenergysystemsbecomemoreinterconnectedandreliantonadvancedtechnologies,suchassmartgrids,supervisorycontrolanddataacquisitionsystems,andotherdigitalinfrastructure,theycanbecomevulnerabletocyberthreats.Thus,cybersecuritymeasuresandrobustdefencesneedtobeprioritizedtomitigatetheserisksasgridsadvance.Thegrowingshareofelectricityinfinaldemandduetoelectrification,coupledwiththerisingunpredictabilityandfrequencyofextremeweatherevents,compoundstherisksandvulnerabilitiesofenergygridsintheongoingenergytransition.Maintainingglobaltrustwillbeimportantinthefutureforensuringstableenergysupplyanddemandatnationalandinternationallevels.Countriesmusthaveconfidenceineachother’sabilitytohonourtheirenergycommitments,asanydisruptionintheglobalmarketcouldhavesevereconsequencesforeconomicandsocialstability.Interconnectors,bothwithincountriesandacrossinternationalborders,playavitalroleinfacilitatingthistrustbyenablingtheefficienttransmissionandsharingofelectricity,diversifyingenergysourcesandpromotingcooperationinthefaceofgeopoliticalrisks.Theincreasingactivismofgeopolitics,includingthecomplexrelationshipsbetweentheOrganizationofthePetroleumExportingCountries,China,theUnitedStatesandEurope,furtheremphasizestheimportanceofinterconnectorsandongoingcooperationinensuringasustainableenergyfuture.Electrification’sriseinfinaldemandandextremeweathereventsincreaserisksforenergygridsintheongoingenergytransition.FosteringEffectiveEnergyTransition:2023Edition23Afterdecadesofsmallsteps,theEUandotherpartsoftheworld–mostnotablytheUS–nowseemtobeseriousabouttransformingenergysystems.Thisisespeciallyclearinthecaseofwindenergy,whereoverthepastyearpolicy-makersintroducedseveralnewambitioustargets.Recently,theEUproposedtheNet-ZeroIndustryAct,whichincludesincreasingwind-turbinemanufacturingcapacityto36GWannuallyby2030.Toputthatintoperspective:In2022,Europeinstalledwindturbinestotalling16GW.That’shalfofwhatweneed–ahugegaptofillwithinashortperiod.TheonshoremarketinGermany,forexample,shranksignificantlyin201816–andthenumberofoffshorewindprojectsbarelyincreased.Thishasforcedsupplierstoclosebusinesses,thousandsofpeopletolosetheirjobs,andmanyskilledprofessionalstomoveintodifferentsectors,makingitevenmorechallengingtoachievetheEU’sambitionofreaching440GWofwindenergycapacityby2030.Weneedmassiveinvestmentsandbetteraccesstofunding.WindturbinemanufacturersareableandreadytocontributetotheambitiousinstallationtargetsinEuropeandaroundtheworld.However,appropriatepolicyframeworksarenecessary.Massiveinvestmentsneedtobemobilizedinkeyinfrastructuresuchasroads,portsandgridstomeetthegrowingdemandforrenewableenergyandtoexpandproductioncapacities.Giventheslowexpansioninrecentyears,themajorchallenge–especiallyforoffshorewind–willbetosustainablyincreasemanufacturingcapacities.Existingpolicyframeworkshavehinderedwindturbinemanufacturersinestablishingasustainablebusinessmodel.FutureframeworksneedtofacilitatetheexpansionofproductioncapacitiesandtheEU,anditsmemberstates,mustputmoresubstantialandflexiblepublicfundingmechanismsinplaceifwewanttoachievegovernmentexpansiontargets.Thissummer,theEUisexpectedtoproposeaSovereigntyFund.ItremainstobeseenwhetheritwillprovideanapproachaspragmaticandclearasthatoftheUSInflationReductionAct,whichmobilizesinvestmentwithapreferencefordomesticgreentechnologies.TheEUInnovationFund,however,whichislimitedtothefundingoftechnologicalbreakthroughsandwillbeinplaceuntiltheSovereigntyFundisestablished,isnotsuitableinitscurrentformtosupportacceleratedinvestmentinmanufacturingcapacity.Weneedtocutthroughtheredtape.SlowpermittingprocesseshavebeenathornintheEuropeanwindindustry’sside.InEurope,anoverallcapacityof80GWiscurrentlytrappedinvariousstagesofpermitting.Thisisabignumbergiventoday’soverallcapacityofalittleover204GW.Hadthose80GWbeeninstalledby2022,theycouldhaveeasedtheenergycrisisinEurope.Tospeeduptheprocess,itiscrucialthateverypermittingauthorityactquicklyandunbureaucratically.Furtherneedsaretodiversifythesupplychain,ensureinflationcompensationandreassessauctiondesign.Windturbinemanufacturershavenotbeensparedfromthesignificantdisruptionsinglobalsupplychains.WhiletheEuropeanwindindustryneedstodoitspartbyimplementingdiversificationstrategies,theEUmustdoitspartaswell.Theenergytransitionwillneedasecure,abundantandaffordablesupplyofcriticalminerals.WhiletherecentlypassedCriticalRawMaterialsAct,whichaimstosecureanddiversifyadomesticsupplychainofrawmaterials,isastepintherightdirection,wearestillwaitingondetailsregardingimplementation.Rawmaterialsmustbeavailableforwindturbinemanufacturersatfairprices.Otherwise,thereisnolevelplayingfield.Furthermore,giventhecriticalroleplayedbytheprivatesectorintheEU’senergytransition,buildingsustainablebusinessmodelsiskey.Costescalationsbetweenauctionsandprojectconstructionexposedevelopersandmanufacturerstorisingcoststhatcandramaticallyexceedprojectedrevenuesandreducemargins.Thisisdueinparttobroadermacroeconomicandgeopoliticalfactors.Mechanismstocompensateforinflation-inducedcostescalationsarecrucialtocreateariskprofileconducivetolong-terminvestmentsatscale.Finally,policy-makersneedtointroduceandemphasizequalitativeauctioncriteria,suchassustainability,cybersecurityand“madeinEurope”elements.Asitstands,thepredominantweightingofthepricecriterionalsoincreaseselectricitypricesforendconsumers,whichcontradictsthegoalofaffordableenergy.Thegoalisclear,andsoisthepath–nowwehavetoshowwereallywantit.IfwereallywantenergyindependenceinEurope,weneedtomakesurewehaveahealthyandresilientwindindustry.Thereisnoquestionthatthewindindustryisofenormousstrategicimportance.Butweneedtoactfast.Weneedmorewindnow.GUESTPERSPECTIVEEuropeneedsmorewindnow.Andweneeditfast.ByJochenEickholt,ChiefExecutiveOfficer,SiemensGamesaRenewableEnergyFosteringEffectiveEnergyTransition:2023Edition24SustainableTheETIbasesthesustainabledimensiononacombinationofenergyefficiency,decarbonizationandprogresstowardscleanenergysystems.Inthepastdecade,thisdimensionhasseena7%growth(Figure10)intheglobalscores,withCostaRica,ParaguayandAlbanialeadingthechartsfor2023.Paraguay’suseofhydropowerinitsenergymixhasenabledittomaintainlow-carbonintensityinitseconomyandeffectivelymanageairpollution,providingitwithoneofthecleanestenergymixesinSouthAmerica.ThecountriesfromtheMiddleEast,NorthAfricaandPakistanregionrankinthelowestquartilesonthesustainabledimension,despitetheirabove-averageperformancesontheequitableandsecuredimensions.Theycanembracesustainabilitybyswitchingtolow-carbonsourcesofenergy,eliminatingwaterscarcityandimprovinghouseholdwastemanagement.Thiscanhappenwiththepublicandprivatesectorscollaboratingtomaketheswitchtoamoresustainablewayoflife.Theglobalsustainablescores,however,needtoimprovefurthertoacceleratethetransition,sinceimprovementonthisdimensionhasadirecteffectonnet-zerogoals.Transitioningtowardssustainableenergysystemsisacomplexprocessrequiringcarefulpolicyplanningandimplementation.Acentralthemeisthatnoone-size-fits-allpolicypackageexistsforsustainableenergytransitions,aseachcountry’sobjectivesandconstraintswillshapeitspolicyapproach.Yetaroundtheworld,manycountriesareundergoingorplanningtransitionstowardssustainableenergysystemsthroughacombinationofpolicymeasures,technologicaladvancesandchangesinconsumerbehaviour.Afewexamples:–Energyefficiency:AccordingtotheInternationalEnergyAgency(IEA),“Since2020,governmentsworldwidehavehelpedmobilisearoundUSD1trillionforenergyefficiency-relatedactionssuchasbuildingretrofits,publictransportandinfrastructureprojects,andelectricvehiclesupport.ThisamountstoapproximatelyUSD250billionayearbeingdeployedfrom2020to2023,equivalenttotwo-thirdsoftotalcleanenergyrecoveryspending.”17Forexample,alsoaccordingtotheIEA,“underitsrecoveryandresilienceplan,SpainintendstoinvestEUR3.4billioninhalfamillionenergyrenovationactionsthroughtaxincentivesandthecreationof‘one-stop’renovationoffices”.18–Technologicaladvances:Achievingnet-zeroemissionsrequirestheimmediateandwidespreaddeploymentofcleanandefficientenergytechnologies.Majoreconomiesareintegratingtheirclimate,energysecurityandindustrialpoliciesintobroaderstrategies.ExamplesincludetheUSInflationReductionAct,theFitfor55packageandREPowerEUplanintheEU,Japan’sGreenTransformationprogramme,India’sProductionLinkedIncentiveschemesandChina’slatestFive-YearPlan.ETIsustainabledimensiontrend,2014-2023FIGURE105456586062646668Indexscore55.555.956.156.656.856.957.157.458.259.1542014201520162017201820192020202120222023Source:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition25–Behaviouralchanges:Suchchanges,orthedailyalterationsthatdiminishwastefulorexcessiveenergyconsumption,areimportanttoreachnet-zeroemissionsby2050.Atthe26thConferenceoftheParties(COP26),IndianPrimeMinisterNarendraModiunveiledMissionLiFE(LifestyleforEnvironment),aprogrammethataimstoprioritizeindividualbehaviourintheglobalclimateactiondiscoursebyshiftingawayfromthecurrent“use-and-dispose”economicmodeltowardsacirculareconomycharacterizedbyconsciousanddeliberateutilization.19ThismoveshouldbewelcomeforahighlypopulouscountrysuchasIndia,wherebehaviouralchangescanhaveasubstantialeffect.Despitesomeoftheprogressiveinitiatives,thesustainableenergysystemremainsvulnerableatlarge.In2022,theRussia-Ukrainewarledtoaglobalenergycrisiswithskyrocketingpricesandsupplydisruptions.Asaresult,countriesresortedtocoaltofulfilenergydemands.Theworld’scoalconsumptionreachedanewhigh,surpassing8billiontonnesinasingleyearforthefirsttimeandeclipsedthepreviousrecordsetin2013.Thebrightsideisthatgovernments,banks,investorsandminingfirmscontinuetoshowareluctancetoinvestincoal,particularlythermalcoal.NoclearindicationsexistofareversalininvestmenttrendsoutsideofChinaandIndia,wheredomesticproductionhasbeenraisedtodecreaseexternaldependence.20Inaddition,thepolicyresponsesoverallinmanyregionstotheglobalenergycrisis,suchasthosetakeninmajoreconomies(e.g.EU,UnitedStatesandJapan),arelikelytoacceleratecleanenergydevelopmentsfurther.Whileglobalcommitmentsandactionstoadvancethesustainableenergytransitionhaveincreasedrecently,theystillfailtoattaintherequiredleveltolimittheriseinglobaltemperaturesto1.5°Candavoidthemoresevereconsequencesofclimatechange.Severalsustainableindicatorshavebeenanalysedtoevaluatehowfarcountriesarefromtheidealtargets(Figure11).Countrydensitybasedonthe2030targetsderivedfromtheIEANetZeroby2050scenariosFIGURE11EnergyintensityofGDP,MJ/2017$32countrieshittingtarget,11%ofTES86countriesbehindtarget,89%ofTES2countriesn/a,<1%ofTESDerived2030Target:302468101214161820Energyconsumptionpercapita,GJ/capita59countrieshittingtarget,22%ofTES61countriesbehindtarget,78%ofTESDerived2030target:65.930100200300400500600700800Carbonemissionspercapita,CO2e/capita50countrieshittingtarget,19%ofTES70countriesbehindtarget,81%ofTESDerived2030target:2.4205101520253035Carbonintensityofenergymix,kgCO2/GJ30countrieshittingtarget,9%ofTES89countriesbehindtarget,91%ofTES1countryn/a,<1%ofTESDerived2030target:36.710102030405060708090COAL(inelectricitymix),%79countrieshittingtarget,33%ofTES38countriesbehindtarget,67%ofTES3countryn/a,<1%ofTESDerived2030target:160%10%20%30%40%50%60%70%80%90%AbovetargetBelowtargetGoalAverageNotes:MJ=megajoule;GJ=gigajoule;TES=totalenergysupplySource:IEA,“WorldEnergyOutlook2022FreeDataset”,January2023,https://www.iea.org/data-and-statistics/data-product/world-energy-outlook-2022-free-dataset(accessed17May2023).FosteringEffectiveEnergyTransition:2023Edition26Tocurtailglobalwarmingfurtherto1.5°C,globalGHGemissionsmustbecutby45%withineightyearsandcontinuetodeclinerapidlyafter2030toavoidexceedingtheremainingatmosphericcarbonbudget.Thetripleplanetarycrisisofclimatechange,pollutionandbiodiversitylossrequireswidespreadimplementationofrenewableenergytechnologies,electricvehiclesandenergy-efficientretrofitsforbuildings.Cross-cuttingsystemictransformationsoffoodsystemsandthefinancialsystemarealsonecessarytoreduceemissionsbeyondcurrentmitigationpledges.Theneednowistocontinueacceleratingtheoverhaulofglobalenergysystemsandtosetmilestonesforvarioussectorsandtechnologies.Solutionsinclude:–Renewableenergy:Solarphotovoltaicsandwindpowershouldaccountfornearly70%ofglobalelectricitygenerationin2050.–Energyefficiency:Increasingenergy-efficientsolutionsforbuildings,vehicles,appliancesandindustrycancreatejobswhilereducingemissions.–Electrification:Electrificationinfinaldemandcandrivetherapidreductionofemissionsthroughelectricvehiclesintransportation,heatpumpsinbuildingsandelectricfurnacesinindustry.–Bioenergy:Low-emissionfuelsandbiomethanecanreplacenaturalgasforheatingandtransportation.–Carboncapture,usageandstorage:Thiscanhelptackleemissionsfromexistingassetslikecementandenablelow-emissionhydrogenproduction.–Hydrogen-basedfuels:Hydrogencanbeusedinheavyindustries,suchassteelandchemicals,andintransportationforshipsandplanes.FosteringEffectiveEnergyTransition:2023Edition27Progressonthesustainabledimensionvariesdependingontheindicatorconsidered.Thischartoutlinesfiveindicatorsusingathree-yearcompoundannualgrowthrate.Ithelpstoidentifyindividualleadersaswellascountryfocusareasandgaps.Theorderisconsistentwiththe2023ranks.AcloserlookattheprogressofsustainabledimensionindicatorsoverthepastthreeyearsTABLE2Progress>67thpercentileProgress67th-33rdpercentileProgress33rd-0percentileNegativeprogressDatanotavailableCountryEnergyintensityCO²intensityCO²percapitaShareofelectricityRenewablecapacitySwedenDenmarkNorwayFinlandSwitzerlandIcelandFranceAustriaNetherlandsEstoniaGermanyUnitedStatesUnitedKingdomBrazilPortugalSpainChinaHungaryCanadaLuxembourgAlbaniaNewZealandUruguayAustraliaCostaRicaLatviaJapanIsraelSloveniaChileKorea,Rep.AzerbaijanCroatiaParaguayMalaysiaLithuaniaGreeceItalyColombiaPolandIrelandBelgiumVietNamSlovakRepublicCzechRepublicKenyaElSalvadorBulgariaRomaniaBosniaandHerzegovinaPanamaCyprusPeruThailandIndonesiaMoroccoSaudiArabiaNamibiaQatarMauritiusCountryEnergyintensityCO²intensityCO²percapitaShareofelectricityRenewablecapacityMaltaGeorgiaUnitedArabEmiratesUkraineTurkeySriLankaIndiaMexicoMontenegroSingaporeJordanArmeniaTajikistanBoliviaCoted'IvoireKazakhstanSerbiaEcuadorEgypt,ArabRep.Macedonia,FYRCameroonSouthAfricaLaoPDRCambodiaArgentinaAlgeriaGuatemalaGhanaTunisiaOmanKyrgyzRepublicIran,IslamicRep.DominicanRepublicPhilippinesEthiopiaGabonNepalTrinidadandTobagoAngolaHondurasRepublicofMoldovaKuwaitVenezuelaSenegalBruneiDarussalamBotswanaPakistanNigeriaMozambiqueBahrainMongoliaLebanonBangladeshNicaraguaJamaicaZimbabweZambiaTanzaniaCongo,Dem.Rep.Yemen,Rep.Source:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition28Anationlosescriticalenergysuppliesandlooksforalternatives,balancingitsnear-termneedsagainstlonger-termsustainabilitygoals.WhilemostthinkthisreferstoaEuropeancountryfollowingtheRussia-Ukrainewarof2022,italsodescribestheKingdomofMorocco,whichmanagedtomeetitsdevelopmentneedswithoutderailingthesustainabilityagenda,whileincreasingenergysecurity.2022willberememberedastheyearwhenconsumersandpolicy-makersfavouredshort-termsecurityoversustainability.However,securityconcernsareneithertemporarynorsuperfluous.Energytransitiontakestimeandcouldrequireinvestmentsof$250trillionover30years.InAfricaalone,nearly600millionpeopleremainwithoutaccesstomodernformsofenergy.Afterlockdowns,warsandmarketdislocations,2022offeredusaclearconviction:thisisthewrongtimetolosecredibilityandtrustafteryearsofadvocacyonclimate,natureandbiodiversityprotection.In2021,a10billioncubicmetrenaturalgaspipelinebetweenAfricaandEuropeshutdown,cuttingMoroccooff.Thecountrycouldhavegonedownanirreversiblepathofretoolingtheenergysystemwithfossilfuels.Instead,itjoinedtheworldatCOP26inresolutionstomovebeyondcoal.ThoughMoroccowasstillrecoveringfromtheeconomicshockwavesofCOVID-19,itturnedthischallengeintoanopportunitybyputtinginplacearoadmapforenergysecurity,includingfast-trackingsustainableaccesstotheinternationalLNGmarketto“powerpastcoal,”decarbonizingindustriesandaddressingtheintermittencyofrenewables.TheintegrationwithinternationalLNGmarketsbyreversingtheflowofatranscontinentalpipelinewasacriticalmovetorestorethetrustofpeople,investorsandallies,withajustandinformedenergy,economicandsocialtransition.Againstabackdropofuncertainty,Moroccodecoupledsupplyfrominfrastructureandincreasedthesystem’ssecurity,sustainabilityandflexibilitybyenablingmorerenewables,pushingformoreefficiencyandincreasingintegrationwithglobalmarkets–threepillarsofitsenergystrategy.InEurope,commodityandutilitybillssoaredtorecordlevels.Countriesscrambledtoacquiresuppliesorcurtailconsumption.Forsome,2022resembledthe1970soilpriceshocks.Thistime,countrieshavebarelyemergedfromaglobalpandemic,withsoaringinflationandtighteningmonetarypolicies.Energypoverty,supplyinsecurityandenvironmentaldegradationhavebecomethenorminmanycountries,alongsidefoodandwatercrises.Adifficultglobalenvironmentmakesinformedsustainableeconomicsandrenewedmultilateralismevenmorecritical.Thisiskeytotacklethetriplecrisisofthiscentury:climatechange,pollutionandbiodiversityloss.Threetellingexamples:–Carbonpricesreached€100pertonthefirsttimeinFebruary2023intheEUemissionstradingsystem,pushingthevalueoftradedglobalmarketsforCO2closeto€1trillion–aclearsignalofinformedeconomics.–AsweconsiderthethemeofthesixthsessionoftheUnitedNationsEnvironmentAssembly,toendplasticpollutionandpromotenature-basedsolutionsforsupportingsustainabledevelopment,thecalltoreinvigoratemultilateralismtoovercomethemultiplecrisesthatputtheviabilityoflifeonearthatriskispressingandneedstobesupportedwithinformeddecisions.–TheJuly2022InflationReductionAct’sHydrogenShotincentivestarget$1perkgby2031,whichisapositiveeconomicsignal.However,whilesomeareliftingfrackingbans,re-firingcoal,andarbitrarilypricinginandoutexternalities,policy-makersmustensurethattaxpayers’moneyisnotusedtoincentivizenewbubblesthatgeneratenegativereturnstosociety,strandedassetsorbankruptcies.Iffinancialinstitutionsandtheprivatesectorsaythat,withtherighteconomiesofscaleandincentives,properlystructuredinvestments,andtherightbalancebetweenadaptationandmitigation,wecanmovetogethertowardsajust,informed,affordableandbankabletransition,whynotdojustthat?Torestoreandnurturetrust.GUESTPERSPECTIVEHowMoroccostaysthecourseonajusttransitiontowardssustainabledevelopmentByLeilaBenali,MinisterofEnergyTransitionandSustainableDevelopmentofMorocco;President,UnitedNationsEnvironmentAssemblyFosteringEffectiveEnergyTransition:2023Edition29ETItransitionreadinesstrend,2014-2023FIGURE12AsmentionedinFosteringEffectiveEnergyTransition2020Edition,“theenergysystem’sabilitytodeliverontheimperatives…dependsonthepresenceofanenablingenvironmentfortheenergytransition,measuredintheETIframeworkbythetransitionreadinesssub-index.Energytransitionreadinessiscapturedbythestabilityofthepolicyenvironmentandthelevelofpoliticalcommitment,theinvestmentclimateandaccesstocapital,thelevelofconsumerengagement,thedevelopmentandadoptionofnewtechnologies,etc.Someofthesefactorsarebeyondthescopeoftheenergysystem”,suchasskillsorqualityoftransportinfrastructure,“butneverthelessdeterminetheeffectivenessandfuturetrajectoryofenergytransitioninacountry.”21Similartotheprogressachievedonglobalsystemperformanceimperatives,transitionreadinessenablerssustainedagrowingglobalaverageperformanceoverthepast10years(Figure12).Thedirectenablershavebeenfuellingcountries’transitionreadinessandshowcasetheeffectofrecentglobalfocusonthepolicyandinvestmenttransitionchokepoints.Ontheotherhand,humancapitalandinnovationtransitionenablersdidnotmakesubstantialprogressoverthesameperiod,underscoringtheimportanceofpayingmoreattentiontotheseblindspotstounlockfurthertransitionmomentum.InadditiontoasetofleadingadvancedEuropeaneconomies,SouthKorea,ChinaandJapanareamongtheleading20countriesregardingtheenablingtransitionenvironmentin2023.Financialinvestmentincleanenergycontinuestobeakeyenablerfortransitioningeconomies.Itnurturesotherenablersoftransition,suchastechnologydevelopmentanddeployment,whileactivelyfacilitatingthescale-upofrenewablescapacityandassociatedinfrastructure.Despitetheprogressachieved,investmentsincleanenergysupplyremainachallenge.Onlysixcountriesmanagedtodirectmorethan1%oftheirGDPin2022towardsinvestmentsinrenewables.ChinahadthelargestshareofGDPinvestments,investingmorethan1.5%ofGDPinrenewables,followedbyVietNam,Azerbaijan,andBosniaandHerzegovina.CountrycommitmentstotheirtransitiontargetsthatweresetaspartoftheParisAgreementhavebeentranslatingintotransitionstrategies.Thelevelofgranularityandmaturityofthesestrategiesvariessignificantly.Asof2023,only17outof120countrieshavemanagedtoreflecttheirnet-zerotargetsintotheirrespectivelaws,inamannerthattargetsallGHGemissionsanddeliversin2050orearlier.Aneffectivecountrypolicyforenergytransitionprovidesthenecessaryframeworktoacceleratethetransitiontoacleanerenergysystemandaddresstheassociatedchallengesofequityandsecurity.Whilemostcountrieshaveastrongenablingpolicyenvironmentregardingenergyaccess,thatenvironmentisnotasstrongforpoliciesthatenablescalingofrenewablecapacityorinducingenergyefficiency.AsidefromasetofleadingadvancedEuropeaneconomies,SouthKorea,India,MexicoandHungaryhaverecentlyexhibitedastrongenablingregulatoryenvironmenttoaccelerateabalancedtransition.RegulationsandpoliticalcommitmentEducationandhumancapitalInnovationInfrastructureFinanceandinvestment30354045505560652014201520162017201820192020202120222023Score(0–100)4.2TransitionreadinessOnlysixcountriesmanagedtodirectmorethan1%oftheirGDPin2022towardsinvestmentsinrenewables.Source:WorldEconomicForumFosteringEffectiveEnergyTransition:2023Edition30Speedandscale:AdvancedenergysolutionsAdvancedsolutions–includinghydrogen,sustainableaviationfuels,advancednuclear,storage,carbonanddemandmanagement–harness,manageandusecleanenergyacrosstheenergysystem.Askeyenablersoftheenergytransition,theyhelpaddresstheintermittencyofrenewableenergy,enableelectrificationoftransportandindustry,improvesystemefficiency,decarbonizehard-to-abatesectorsandeliminateCO2fromtheatmosphere.TheIEAestimatesthataround$2.8trillionwillbeinvestedinenergyin2023.Morethan$1.7trillionisgoingtocleanenergy,includingrenewablepower,nuclear,grids,storage,low-emissionfuels,efficiencyimprovementsandend-userenewablesandelectrification.Forevery$1spentonfossilfuels,$1.7isnowspentoncleanenergy.Fiveyearsagothisratiowas1:1.Thepriceofsolarmodulesdeclinedby99.6%since1976FIGURE13PriceperWattofsolarphotovoltaics(PV)modules(logarithmicaxis)Thepricesareadjustedforinﬂationandpresentedin2019US$.$0.51MW=1,000,000Watt2MW5MW20MW50MW10MW100MW1,000MW10,000MW100,000MW$1$2$5$10$20$50$100CumaltiveinstalledsolarPVcapacity(logarithmicaxis)19771976197819791980198119831985198619901994199519982000200220052008200920102011201220132015Witheachdoublingofinstalledcapacitythepriceofsolarmodulesdroppedonaverageby20.2%.Thisisthelearningrateofsolarmodules.20162019Source:Roser,Max,“Whydidrenewablesbecomesocheapsofast?”,OurWorldinData,1December2020,https://ourworldindata.org/cheap-renewables-growth(accessed17May2023).4.3AcloserlookatinnovationLikewindandsolar,thegigascaleandindustrializationofadvancedsolutionshavethepotentialtodrivedowncosts–thus,thereisaneedtoexponentiallyacceleratethespeedandscaleoftheirdeployment.Forexample,tobeonthepathtonetzeroby2050,theenergysystemneedstoseebatterystoragecapacitygrow15times22andcarboncapture,usageandstorage40times23by2030.Similarly,thecleanhydrogenmarketisexpectedtogrowfrom$0.5billionto$120billion24andadvancedbiofuelsfrom$3billionto$180billion.25FosteringEffectiveEnergyTransition:2023Edition31Deploymentatthisscaleneedstobebackedbysignificantcapital.TheIEAnotesthat$0.9trillionneedstobeinvestedby2030tomodernizeelectricitynetworksandbuildpublicelectricvehiclechargingstations,hydrogenrefuellingstations,directaircaptureandCO2pipelines,storagefacilities,andimportandexportterminals.Further,$1.7trillionneedstobeinvestedannuallyinlow-carbontechnologiesinend-usesectors.26Mostofthisinvestmentwillneedtocomefromtheprivatesector,supportedbypublicpoliciesthatcreateincentivesandsetappropriateregulatoryframeworks.Agrowingnumberofinvestorsfrombothspecializedandlargerinfrastructurefundsareactivelyseekingopportunitiesinthesector.Moreover,governmentsprovidestrongsupportthroughpoliciesaimingtomultiplycleanenergyinvestments.Innovativecapitalmarketinstruments,suchasgreenbonds,openadditionalavenuestoincreasefunding.Thegreenbondsmarketexperiencedspectaculargrowthfrom$36billionworthofissuancesto$270billionin2020.27Subsequently,anincreasingnumberofprojectsarebeingannouncedanddeployed.TheIEAhasobservedthat,“announced[electricvehicle]batteryproductioncapacityfor2030isonly15%lowerthanthelevelofbatterydemandunderpinningtheIEA’sNetZeroEmissionsScenario”and“cumulativeoutputofelectrolysermanufacturingcapacitycouldreach380GWby2030,whichisstilllittlemorethanhalfof2030needs”inthatscenario.28However,itisoftendifficultforinvestorstofindopportunitiesthatmatchtheirprofileintermsofscaleandmaturity.Theriskappetiteoffinancialinstitutionsisnotalwaystailoredtosupportadvancedsolutions.Thisisachallengeinemergingmarketsanddevelopingeconomies,causingthemtoreceiveasmallfractionofinvestments.Inaddition,sovereignandcurrencyrisks,thelackofstandardsandregulations,andslowpermittingprocessesremainsignificantbarrierstocleanenergyinvestmentsintheseeconomies.Achievingtheneededpaceandscaleofgrowthandinvestmentsrequiresinnovators,largeenergyproducersandusers,andinvestorstoformpartnershipsandplaytheirpart.Toaidinthisprocess,theWorldEconomicForumisproducingthe“HandbookforExponentialDeploymentofAdvancedEnergy”,whichwillincludeasetofstrategicrecommendationsforthesekeystakeholderstoexpandandacceleratethedeploymentofadvancedenergysolutions.Thisinitiative,ledbytheForum’sAdvancedEnergySolutionscommunity,engagesleadersinfrontier,fast-growingsegmentsoftheenergysystemandseekstohelperadicatethegreenpremiumandmaximizeco-benefits.32FosteringEffectiveEnergyTransition:2023EditionConclusion5Severalenvironmental,macroeconomicandgeopoliticaleventsoverthepastdecadehaveaffectedtheenergysysteminmyriadwaysandhighlightedthecomplexitiesoftheenergytransition.Overthepastdecade,theworldhasmadesignificantstridestowardstransitioningtolow-carbonenergysystems,althoughnotatthepacerequiredtoachievenet-zeroemissionsby2050.Thelackofconsistentandbalancedprogressformanycountrieshighlightsthechallengeofnavigatingtheenergytransition.Byelevatingenergysecuritytobeacornerstoneoftheframework,advancesinthesecuredimensioncanbeseenascountriesaimforastableandsecuresupplyofenergytomaintaineconomicgrowth,nationalsecurityandthewell-beingoftheirpopulations.Veryfewcountries,however,areadvancingmomentumacrosstheequitable,secureandsustainabledimensions,andimprovementsinsecurityarebeingdeliveredattheexpenseoftheothers.Thestrongcompetitionforsecuredaccesstogassuppliersandstocksreplenishment,alongwithconcernsaboutsecurityofsupply,posesignificantchallengesfortheupcomingwinter.Additionally,someareaswillcomeunderfuturescrutiny,suchastheimportanceofcriticalrawmaterials,upcomingregulatoryobligationsforreportingonsustainableinvestments,andthevulnerabilityofenergysystemstoextremeweatherevents.Whileadecarbonizedfutureenergysystemcanprovideenergysecuritydividendsfromabundantandlocalizedlow-carbonenergysources,ensuringenergysecurityandaffordabilitythroughthetransitionwillrequirefossilfuelsinthemediumterm.29Countrieswillneedtoadjustdemandandimproveeconomicsofsupplytominimizeemissions.Cleanerenergysourcesandtechnologieswillberequiredinthenexttwotothreeyearstomeet2030targetsandlimittheeffectsofclimatechange.Mostofthesehaveexistedfordecadesbutwillneedgreaterandmoretargetedinvestmentorincentives.Toensureanequitabletransition,greaterinvestmentwillalsoberequiredinskillstraining,research,innovationandincentivestobuildsustainablesupplychainsthatprotectecosystemsandcultures.30Policieshaveemergedbutrequireimplementation.ThefocusoftheenergytransitionneedstoshifttomorepopulousanddevelopingnationsinAsia,LatinAmerica,AfricaandtheMiddleEast,astheyaccountforasignificantportionoftheworld’spopulationaswellasglobalcarbonemissions.Whileseveralcountriesarecommittingtotheenergytransitionandhavevastrenewableenergyresources,theylackthefinancesandtechnicalknow-howtodevelopthemfully.Bycollaboratingandprovidingsupport,amoresecure,sustainableandequitablefuturecanbefoundformany.Bolsteringtheenablingenvironmentwillputthesecountriesontheleadingedge.AsfortheupcomingCOP28summit,whichwillincludetheconclusionofthefirstGlobalStocktake,anassessmentoftheworld’sprogresstowardsachievingitsclimategoals.ThestocktakewillcapturewhatcountriesandstakeholdersaredoingorfailingtodotofulfiltheParisAgreement.Whatisclearfromthisyear’sETI,however,isthatcountriesmustmoveatafasterpacethantheyarenowtotransformtheirenergysystems;moreover,thewindowforsucheffortisclosing.Theactionstakenintheearlyyearsofthisdecadeofdeliverywillbecriticalinensuringthatstrong,long-termambitionissupportedbyimmediateprogress.31Thefocusmustbeonenhancinganequitabletransition,whichhasbeentradedoffratherthanenabledbythefocusonthesecureandsustainabledimensions.Theenergytransitionmustbemaderesilienttomaintainspeedundercurrentvolatilitiesandduringpotentialfuturedomesticorinternationaldisruptions.FosteringEffectiveEnergyTransition:2023Edition33Countryperformanceprofiles6Thesecountriesstandoutforlayingthegroundworkforarobustenergytransition.FosteringEffectiveEnergyTransition:2023Edition34KeymacroeconomicandETIdataPopulation(millions)83.2Energyconsumptionpercapita(GJ/capita)140.1GDP($trillions)4.26Netenergyimports(%ofenergyuse)65.02.7050.62Energyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)GermanyCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023EnergytransitioncurrentassessmentSystemperformanceTransitionreadinessMomentum67.511/120ETIScoreRank8020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableLeadingAdvancingAdvancing202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100RegulationsandpoliticalcommitmentFinanceandinvestmentEducationandhumancapitalInfrastructureInnovationSystemperformanceTransitionreadinessNote:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplySource:WorldEconomicForumNote:aRelevantWorldEconomicForumpeergroup:AdvancedeconomiesSource:WorldEconomicForumCountryPeergroupFosteringEffectiveEnergyTransition:2023Edition35CountryanalysisKeyprogressonETIGermanyisthefourth-largesteconomyintheworldandranks11outof120countriesontheETI2023.Since2014,Germany’sscoreontheETIhasincreasedby6%,whichshowsboththerobustnessofitsenergytransitioneffortsandthechallengeslargeeconomiesfaceinimprovingquickly.Withinsystemperformance,Germany’sscoresonthesecureandsustainabledimensionshaveimproved,drivenlargelybysupplysecurity,anincreaseinshareofrenewableenergyintheelectricitymixandstrongreductionsintheenergyintensityoftheeconomy.Eventhoughthecarbonintensityoftheoverallenergymixhasdeclinedovertheyearsby9%,itremainsrelativelyhigh,owingtopersistentchallengesindecarbonizinghard-to-abatesectors,suchasheating,transportandheavyindustry.Germanyranksfifthgloballyontransitionreadiness,whichprovidesanassessmentoftheenablingenvironmentforenergytransition,asitisoneofthetopthreecountriesonregulationandpoliticalcommitment.KeyimperativesandpoliciesinplaceThecoreelementsofGermany’senergytransitionareimprovingenergyefficiencyandexpandingrenewablesasquicklyaspossible.Thegovernmenthasinvestedinthedevelopmentofenergy-efficienttechnologiesandinfrastructure,suchassmartgridsandelectricvehiclechargingstations.ThishasresultedinGermanynowproducingover40%ofitselectricityfromrenewables,32havingsetagoalofreaching80%by2030.33Thecountryhasintroducedseveralpoliciesaimedatincreasingtheshareofrenewablesintheenergymix,phasingoutnuclearpower(withthelastplantclosinginApril2023)andreducingGHGemissions,resultinginthecountrybecomingaleaderintheenergytransition.TheEnergiewende(energytransition)wasinstitutednearlyadecadeagoasaplanfortransformingtheenergysystem,makingitmoreefficientandsuppliedmainlybyrenewableenergy.TheGermanRenewableEnergySourcesActhasplayedasignificantroleinthetransitionbyprovidingalegalframeworkandfinancialincentivesfortheexpansionofrenewableenergysources.This,togetherwiththeEnergyIndustryAct,formsthelegalbasisoftheGermanenergyindustryandprovides“aframeworkpolicytoenhancecompetition,securityofsupplyandsustainableenergyproduction…Furthermore,thisActstipulatessupplementaryprovisionsfortheaccessofelectricityfromrenewablesourcestothegridaswellastheconstructionofintelligentgridsincludingelectricitystorage.In2012thelawwasamendedtospeeduptheexpansionofoffshorewindfarms.Themajorfocusisonasystemchangetowardsaconsistentandefficientoffshoregridexpansionbyintroducingabindingoffshoregriddevelopmentplan”.34Thegovernmentalsopassedalawin2020thatrequiredphasingoutallcoal-firedelectricitygenerationnolaterthan2038;thetimelinewasrecentlybroughtforwardto2030.Thenetresultofthesepoliciesisreflectedinthecountry’shighETIscoresonregulationandpoliticalcommitment,aswellasdecarbonizedandcleanenergy.What’snext?EnergytransitionremainsaprocessasGermany’sdiversificationofitsenergymixisnotpurelyfocusedonsustainabilityandefficiencygainsbutalsoonsecurity.Over-relianceonimportedgasfromRussiaandhighenergypriceswerethemainchallengesfacedbyGermanyduringtheenergycrisis.TheRussia-Ukrainewarpromptedthegovernmenttoinstituteemergencymeasures,suchasbuildingLNGregasificationcapacityanddelayingcoalplantclosures,whichsloweddownthetransitionmomentumandlockedinmoreemissionsinthesystem.ToensurereduceddependenceonRussiangasandacceleratethelonger-termtransitioninGermany,thegovernmenthasinstitutednumerousamendmentstoexistinglawsandfundingprogrammesthatprimarilyfocusonenhancingthenation’srenewableenergycapabilities,particularlyinonshorewind;increasingthevolumeofrenewablepowerauctions;andspeedingupgridplanningandthegrowthofoffshorewindconnectionstocarryelectricitygeneratedfromwindpowerinnorthernGermanytolargeindustrialcomplexesinthesouth.Additionalactions,suchas“creatingthelegalandfinancialframeworksforcarboncontractsfordifference,aninstrumentthatsupportsindustryintransitioningtoclimate-neutralproductionprocesses”,35promotingresearchanddevelopmentingreenhydrogentocreatemodernfuture-orientedclimateprotectiontechnologies,andformingstrategicpartnerships,couldhelpensureanorderlyenergytransitioninGermanyandprovidelessonsforothercountries.EnergypolicyprioritiesCoveratleast80%ofgrosselectricityconsumptionbyrenewablesourcesby2030Haveatleast15millionelectriccarsin2030Install1millionpublicchargingpointswithnon-discriminatoryaccessby2030StatedenergytransitiongoalsReduceGHGemissionsbyatleast55%by2030comparedto1990Achievenet-zeroemissionsby2045Phaseoutcoal-firedpowergenerationby2038Reduceprimaryenergyconsumptionby50%by2050FosteringEffectiveEnergyTransition:2023Edition36KeymacroeconomicandETIdataPopulation(millions)331.9Energyconsumptionpercapita(GJ/capita)257.4GDP($trillions)23.32Netenergyimports(%ofenergyuse)-4.04.2749.90Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)UnitedStatesSystemperformanceTransitionreadiness66.312/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableStabilizingLeadingAdvancing202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadiness66.3Countryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:AdvancedeconomiesSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition37CountryanalysisKeyprogressonETITheUnitedStates(US)ranks12outof120countriesontheETI2023.TheoverallETIscorefortheUShasseena10%gainoverthepast10years,drivenbyimprovementsinsystemperformance,particularlyinthesecureandsustainabledimensions.Withinthesustainabledimension,energyintensityandCO2emissionspercapitasawmarkedgainssince2014,fallingby20%and22%,respectively.Thefocusonsustainabilityisfurtherhighlightedbythecountry’smomentuminthisdimension.Withintransitionreadiness,furtherimprovementscanbefoundinareassuchasrenewablecapacitybuildout;developmentoflow-carbonjobs;publicresearch,developmentanddemonstration;andsustainingastableregulatoryframeworkandpoliticalcommitments.KeyimperativesandpoliciesinplaceThecountry’sageingenergyinfrastructureposessignificantchallengesfortheenergytransition,whichrequiresmassivedeploymentofenergyefficiencyandrenewableenergy,anationwidemodernizationandexpansionoftheelectricitygrid,andbroadeningaccessibilityandaffordabilityofcleanenergytechnologies.Achievingthisinanequitablewayrequiresdirectingenergyinfrastructureandresilienceinvestmentstocommunitiesandindustriesthat,untilnow,havestruggledtotransition.Inrecentyears,severalpolicieshavebeenimplementedintheUStoacceleratetheenergytransition.ThefederalgovernmentsetambitioustargetsforreducingGHGemissions,encouragedthedeploymentofrenewableenergytechnologiesthroughtaxcreditsandgrants,andestablishedmandatoryrenewableenergystandardsatthestatelevel.Furthermore,theprivatesectorhasmadesubstantialinvestmentsincleanenergyresearchanddevelopment,andinthedeploymentofrenewableenergyprojects.Thenetresultoftheseeffortsisreflectedinthecountry’shighETIscoresonregulationandpoliticalcommitmentanddecarbonizedenergy,showingthattheUSisnowwellpositionedasaleaderintheglobaltransitiontowardsalow-carbon,sustainableenergyfuture.TwonotablepoliciesthatappeartobeworkingwellfortheUSaretheBipartisanInfrastructureLaw(BIL)andtheInflationReductionAct(IRA).“TheBILincludessignificantfundingfortransmissionandgridimprovements($75billion),increasingresilienceofthenation’snaturalandphysicalinfrastructure($50billion),investinginanationalelectricvehiclecharginginfrastructure($7.5billion),andreducingmethaneemissionsfromorphanedoilandgaswells($4.7billion).”36,37OneoftheBIL’smostsignificantfeaturesisthecreationoftheOfficeofCleanEnergyDemonstrations(OCED),dedicatedtosupporting“demonstrationprojectsincleanhydrogen,carboncapture,grid-scaleenergystorage,smallmodularreactors,andbeyond.Withover$20billionininitialfunding,theOCEDwillfundresearchanddevelopmentandproof-of-conceptprojectsthatseektogalvanizefollow-onprivatesectorinvestmenttodeploycleantechnologies”.38TheIRAprovidespositiveincentivestosupporttheenergytransitionin“theformofcleanenergytaxcreditsalongwithprogramsandpoolsoffinanceforcommercialandemergingcleantechnologies,infrastructure,andproducts”,andlocalcontentrequirements.“Itcommitsroughly$369billioninfundingforclimateandcleanenergyprovisions”,anditisestimateditwill“reduceUSnetemissionsby32%to42%below2005levelsby2030,comparedto24%to35%withoutit,andscalecleangenerationtosupplyupto81%ofallelectricity”.39What’snext?ProjectionsfromthesepoliciessuggestahugepotentialfortheUSenergytransitionandprovidemanycleanenergycompanieswiththecertaintytheyrequire.Therelationshipbetweenincentivesprovided,capitalinvestedandtheeffectofemissions,however,isnotalwaysstraightforward.AdditionallessonsfortheUSwereidentifiedtoenableamoreorderlytransition.40Theseinclude“designinganddeployingacapital-efficientandaffordablesystem;strengtheningsupplychainstoprovidestableaccesstorawmaterials,components,andskilledlabour;securingaccesstoadequatelandwithhighloadfactorsforthedeploymentofrenewableswhiletakingintoaccounttheneedsoflocalcommunities;reformingtransmissiondevelopmenttoincludeproactiveplanning,fast-trackpermitting,andsystematicconsiderationoftransmissionalternatives;creatingmarketmechanismsforexpandingfirmcapacitytoensurereliableandadequatecleanenergysupply;andacceleratingtechnologicalinnovationtoensuretimelydeploymentofnewcleantechnologies”.41Withouttheseadditionalelements,manyofthecleanenergybenefitsonoffermaybelost.StatedenergytransitiongoalsAchieveaneconomy-widetargetofreducingnetGHGemissionsby50-52%below2005levelsin2030Achievenet-zeroemissionsby2050Reach100%carbonpollution-freeelectricityby2035EnergypolicyprioritiesReduceenergywasteElectrifyanddriveefficiencyinvehicles,buildingsandpartsofindustryScaleupnewenergysourcesandcarriers,suchascarbon-freehydrogenFosteringEffectiveEnergyTransition:2023Edition38KeymacroeconomicandETIdataPopulation(millions)67.3Energyconsumptionpercapita(GJ/capita)96.07GDP($trillions)3.13Netenergyimports(%ofenergyuse)28.12.2946.96Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)UnitedKingdomSystemperformanceTransitionreadiness66.213/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableLeadingStabilizing202120222023604020020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessLeadingCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:AdvancedeconomiesSource:WorldEconomicForumEnergytransitioncurrentassessmentMomentumETIScoreRankCountryPeergroupScore(0–100)RegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition39CountryanalysisKeyprogressonETITheUnitedKingdom(UK),ranking13outof120countriesontheETI2023,hasseenan11%improvementinitsETIscoreoverthelast10years.Ithasbeenaconsistentperformer,demonstratingastrongenablingenvironmentforenergytransition,particularlyondimensionssuchaseducationandhumancapital,infrastructure,andregulationandpoliticalcommitment.TheUK’smomentumhasstabilizedinthesecuredimensionbutcontinuestoleadinequitableandsustainable.AsreportedbyThanetDistrictCouncil,“in2019,theUKbecamethefirstmajoreconomyintheworldtolegislateabindingtargettoreachnetzeroemissionsby2050”.42Coalhasbeenphasedoutofpowergenerationaheadofschedule,andtheshareofrenewablesintheenergymixhasincreased.KeyimperativesandpoliciesinplaceTheUK’slegalframework,includingthe2008ClimateChangeAct,hasprovidedstabilityandconsistencyforinvestorsandbusinesses,contributingtothesuccessofrenewableenergydeploymentandemissionsreduction.Theenergypolicy,however,hasundergoneseveralchangesinrecentyears,creatinguncertaintyinthemarket,andrecentreportshavehighlightedtheneedtoprovidelong-termpolicycommitmentsandregulations.43Evenso,thecountryhasmadesignificantinvestmentsinoffshorewind,withoneofthelargestinstalledcapacitiesglobally,andisconsideredaleaderinthisspace.Thedevelopmentofalargedomesticsupplychainforoffshorewindenergyhasalsocreatedjobsandeconomicgrowth,whichisreflectedinthehighETIscoresforhumancapital.NuclearpowerisseenasakeypartoftheUK’slow-carbonenergymix,withrecentinvestmentstoreplaceageinginfrastructureandintroducenewfacilities.Thegovernment’sambitiontoincreasesolarenergygenerationcapacitybyupto70gigawatt(GW)by2035demonstratesitscommitmenttodiversifyingitsenergymixfurther.44Toreduceemissionsfromhard-to-abatesectors,theUKisinvesting£20billionoverthenexttwodecadestoscaleupitscarboncapturesector.45Withits2023InternationalClimateFinance(ICF)Strategy,theUKaimstodoubleICFto£11.6billionbetween2021-2022and2025-2026.Itseekstofurtheracceleratethetransitioninbothenergy-producingandenergy-consumingsectorsbyrapidlyexpandingtheportfolioofrenewableinvestments;workingthroughcoalitionsandpartnershipsundertheBreakthroughAgenda;increasinginvestmentsinresearchanddevelopmentoflow-carbontechnologies;strengtheninggovernance,policyandregulatoryframeworksandstrategicenergysystemsplanning;anddeployingcleanenergyprojectsinenergyintensiveindustries.46DependenceonoilandgashaslefttheUKexposedtotheglobalfossilfuelpriceshock.Annual“gasandelectricitypriceincreasestoApril2022werethelargesteverrecordedinaseriesgoingbackto1970,andhavecontinuedtoriseasRussiahasrestrictedthesupplyofgastocontinentalEurope”,increasingconcernsaboutenergyaffordabilityandsecurity.47Toovercomethesechallenges,thegovernmenthasbeenactivelytransitioningitsenergysectortomeetits2050net-zerotarget,focusingontheproduction,distributionandconsumptionofenergyinmoresustainableways.ABritishEnergySecurityStrategywaspublished,aimingtodecarbonizetheelectricitysystemand“setstrongandstretchingtargetsfortheroll-outoflow-carbonelectricitygeneration”inthecomingdecade,thoughmuchofthestrategyfocuseson“electricitygenerationandoilandgassupply”.48What’snext?TheUKfaceschallengeswithitsgrid,soanylessonslearnedinthisspacecouldbeappliedtoothersaswell.Todelivergenuineenergysecurity,thecountryisprioritizingimprovingenergyefficiencyandreducingenergydemandbyimplementingpoliciestoimproveenergyefficiencyinbuildings,transportandindustry.TheHeatandBuildingsStrategyincludesaphase-outofgasboilersby2035andtheinstallationof600,000heatpumpsperyearby2028.49TheFutureHomesStandardalsosetsnewstandardsandregulationstoreducecarbonemissionsinnewhomesfrom2025,actingasanincentiveforsolarinstallationsinhousingdevelopments.50TheUKhasbroughtforwarditstargetdatefordiscontinuingthesaleofnewpetrolanddieselcarsinfavourofelectricvehiclesfrom2040to2030.51Backedbya£1.6billioninvestmentfromtheElectricVehicleInfrastructureStrategy,theUKplanstoexpanditschargingnetworktohave300,000publicchargersby2030.52EnergypolicyprioritiesAchieve50GWofpowerannuallyfromoffshorewindby2030,70GWofpowerannuallyfromsolarby2035,andbuildnewnuclearpowerstationstogenerate24GWofpowerannuallyby2050Achieve5GWoflow-carbonhydrogenproductioncapacityby2030nstogenerate24GWofpowerannuallyby2050Acceleratetheshifttozero-emissionvehiclesInvestincarboncapture,usageandstorage–foursitesby2030,capturingupto10metrictonnesofCO2emissionsperyearStatedenergytransitiongoalsReduceemissionsbyatleast68%by2030comparedto1990Achievenet-zeroemissionsby2050FosteringEffectiveEnergyTransition:2023Edition40KeymacroeconomicandETIdataPopulation(millions)214.3Energyconsumptionpercapita(GJ/capita)56.21GDP($trillions)1.61Netenergyimports(%ofenergyuse)-11.14.0032.44Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)BrazilSystemperformanceTransitionreadiness65.914/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableAtriskLeadingLeading202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:LatinAmericaandtheCaribbeanSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition41CountryanalysisKeyprogressonETIBrazilistheninth-largesteconomyintheworld53andranks14outof120countriesontheETI2023.TheoverallETIscoreforBrazilhasseenan8%improvementsince2014,havingslippedslightlyin2020andthenincreasingagain.Brazil’sscoresontransitionreadinesshaveseenasignificantimprovementovertheyears.Today,Brazilranksamongthetop14countriesonsustainabilityoftheenergysystem,owingtoitshighshareofrenewablesintheenergymix,with80%ofitselectricitycomingfromlargehydropowerplants.54Investmentsinwindandsolargenerationhavealsoincreasedsignificantlyinrecentyears,makingBrazil’selectricitysectoroneoftheleastcarbon-intensiveintheworld.Recentdroughts,however,havecausedthecountrytorelyonmoreexpensivethermalpowerplantsandimportstomeetitselectricitydemand,resultinginsomechallengesacrosstheequitable,secureandsustainabledimensionswithinsystemperformance.KeyimperativesandpoliciesinplaceWhileBrazilhasmadeprogressincreatingarobustenablingenvironmentforenergytransition–intermsofbuildingastableregulatoryenvironmenttoattractcapitalandinvestmentandbuildinginfrastructuretofacilitateenergytransition–moreeffortisneededtoprovideastablepolicyenvironmentbackedbyambitioustargetstoacceleratethetransition.Thegovernment’smaingoalistostructurethepublicpoliciesneededtoplacethecountryasaworldleaderincleanenergywhilealsoleveragingitssignificantoilandgasresources.Brazilhasalreadyimplementedseveralpoliciestotransitiontowardsamoresustainableandlow-carbonenergysystem.TheAuctionsforRenewableEnergySupportprogrammewaslaunchedin2004toencouragetheinstallationofnewrenewableenergyprojectsthroughacompetitivebiddingprocess.TheseauctionshavenotonlyhelpedreducethecostofrenewableenergyinBrazil,makingitmorecompetitivewithtraditionalenergysources,buthavealsobeensuccessfulinattractingsignificantinvestmentinthesector.WiththeA-3andA-4auctionsinJuly2021,thegovernmentallocated420MWofwindand270MWofsolar,aswellasbiomassandhydro.55Inaddition,theBrazilianDevelopmentBankrecentlyapproved$650millioninfinancingforwindandsolarenergyprojects.56ThenetresultsofthesepoliciesarereflectedinthehighETIscoresonregulationandpoliticalcommitment,infrastructure,andfinancialinvestment.BrazilhasbecomethelargestproducerofwindenergyinLatinAmerica57andranksamongthetop10largestproducersintheworld.58TheProgrammeofIncentivesforAlternativeElectricitySourcespavedthewaytocreatelocalmanufacturingcapacityforwindturbinesandthecomponentsindustry.59ThecountryhasalsoimplementednetmeteringandtheEnergyCompensationSystemforMicroandMini-Generationtopromotedistributedsolargeneration,whichcurrentlymakesup70%ofitsinstalledcapacity.60Brazil’snationalbiofuelspolicy,RenovaBio,cameintoeffectin2020andsettransportationemissiontargets,usingdecarbonizationcreditstoencouragebiofuelproductionandconsumption.RenovaBioalsopromotesthedevelopmentofadvancedbiofuelswithevenloweremissionsandhassucceededinmakingBrazilthesecond-largestbiofuelproducerglobally.61What’snext?Brazil,withalargeandcomplexgridsystemthathasnotfullykeptupwiththedemandsoftheenergytransition,losesabout16%ofthepoweritgenerates.Historically,Brazilhaslackedinvestmentinnewgridinfrastructure,particularlyinremoteareaswherethepotentialforrenewableenergydevelopmentexists.ArecentWorldEconomicForumreport62highlightsopportunitiesforthecountrytounlockcleanenergyinvestmentsthroughinnovativesolutionsandcollaborativeactions,focusingonthreeareasforacceleration:distributedgeneration,hydropowermodernizationandcleanenergyaccessforisolatedsystems.Theselessonscanalsobeappliedtoothercountriesatsimilarlevelsofcleanenergydevelopment.Theproposedsolutionsincludethecreationofadistributedgenerationfinancingtoolboxtosupportdevelopersandfinanciers;suggestionsofregulatorychangestoremovebarrierstothecommercializationofhydropowerplantservices;climateriskandresiliencemappingforhydropowergenerationassets;raisingawarenessoftheClimateBondStandardHydropowerCriteriaamongpotentialinvestors;andcreatingaplatformforexistingindependentpowerproducerstofinddevelopersaswellastechnical,marketingandfinancialsupporttointegraterenewablesandcreatehybridgenerationmodelsinisolatedsystems.EnergypolicyprioritiesExpandbiofuelconsumption,increaseethanolsupplyandraisetheshareofadvancedbiofuelsandbiodieselinthemixIncreasetheshareofrenewablesbeyondhydropowertogenerateelectricitytobetween28%and33%by2030Achieve10%efficiencygainsinthepowersupplyby2030StatedenergytransitiongoalsAchieveclimateneutralityby2050ReduceGHGemissionsfrom2005levelsby37%by2025,andby50%by2030Achievea45%shareofrenewablesintheenergymixby2030Achievean18%shareofsustainablebiofuelsintheenergymixby2030FosteringEffectiveEnergyTransition:2023Edition42KeymacroeconomicandETIdataPopulation(millions)1412.4Energyconsumptionpercapita(GJ/capita)103.8GDP($trillions)17.73Netenergyimports(%ofenergyuse)23.06.3768.81Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)ChinaSystemperformanceTransitionreadiness64.917/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainable202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessAdvancingLeadingLeadingCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:EmerginganddevelopingAsiaSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition43CountryanalysisKeyprogressonETIChinaranks17outof120countriesontheETI2023andisanewentrantinthetop20countries.ItisamongthebiggestproducersandconsumersofenergyintheworldwhilealsobeingoneofitsbiggestGHGemitters,currentlyaccountingforone-thirdofthetotalglobalGHGemissions.ChinahasmaintainedaconsistentupwardtrajectoryontheETIoverthepast10years,improvingstronglyonsystemperformanceandtransitionreadiness.Scoresonthesecuredimensionwithinsystemperformancehaveimproved,mainlythroughbetterqualityofelectricitysupplydiversificationandassociatedgridimprovements.Sustainablescores,however,remainlowonanabsolutescaleascoalisstillthemainfuelforgeneration,accountingfor60%oftotalpoweroutput63despitelargeamountsofrenewableenergycapacityfinancedandinstalledovertheyears.KeyimperativesandpoliciesinplaceChina’sattemptstoimprovetheenablingenvironmentforenergytransitionarestepsintherightdirection,evidencedbyPresidentXiJinping’sSeptember2020commitmentattheUNGeneralAssemblytoreachpeakcarbonemissionsbefore2030andachievecarbonneutralityby2060.64Chinaisemergingasaworldleaderininnovation:publicspendingonresearchanddevelopmenthasrisenby35%since2014.65Inpursuingcarbonneutrality,however,Chinafacesthechallengeofensuringcontinuedenergysecuritywhileshiftingawayfromfossilfuels.Nonetheless,inrecentyears,thethemeofChina’senergyindustryhasbeengreendevelopment,withseveralpoliciesandmeasuresdesignedtoacceleratetheenergytransition,thenetresultsofwhicharereflectedinitshighETIscoreonregulationandpoliticalcommitment.InJune2022,Chinareleasedits14thFYPonRenewableEnergyDevelopment(2021-2025).AsreportedbytheEnergyFoundation,itis“acomprehensiveblueprintforfurtheraccelerating[its]renewableenergy(RE)expansion.Theplantargetsa50percentincreaseinrenewableenergygeneration(from2.2trillionkWhin2020to3.3trillionkWhin2025),establishesa2025renewableelectricityconsumptionshareof33percent(upfrom28.8percentin2020),anddirectsthat50percentofChina’sincrementalelectricityandenergyconsumptionshallcomefromrenewablesovertheperiod2021-2025.…TheREplanisthesecondmajorenergy-related14thFYPreleased[in2022].…[It]establishesdetailedtargetsforprimaryenergymix,powergenerationrate,electrificationrate,andmore.…ThesetwoFYPstogetherreaffirmChina’scommitmenttohonouringitscarbonpledgesthroughacceleratedREgrowth”.66Chinahasdoneagreatdealtousegreenfinancetoincreaserenewables,investingover$380billionin2021,andbeingoneofthefirstcountriestoissueagreenbondprojectcatalogue,todevelopitsownGreenBondPrinciplesandtoworkwiththeEUtodeveloptheCommonGroundTaxonomy.67Oneofthemostsignificanteffortsinthissurgewaspoweringindustrialclusterswithgreenandrenewableelectricity.China’senvironmentalministryalsoproposedtosupportexplorationofnearzero-carbonemissionsandcarbonneutralitypilotdemonstrations.Simultaneously,thecountryispromotingconstructionoflarge-scalerenewableenergybases,distributeddevelopmentofwindandphotovoltaicinthecentralandsouth-eastregions,integrateddevelopmentofwaterandsolarbasesinthesouth-westregion,andcentralizeddevelopmentofoffshorewindineasterncoastalareas.What’snext?TheenergytransitioninChinarequiresahugeshiftinresources,innovationandnewtechnologiestoenhanceenergyefficiencyandresourceproductivity.ArecentWorldBankreportestimatesthatChinawillneedbetween$14trillionand$17trillioninadditionalinvestmentsupto2060forgreeninfrastructureandtechnologyinthepowerandtransportsectorsalone68andhighlightsimportantlessons,includingtheneedforpublicandprivatesectorstoworktogether,“amorepredictableregulatoryenvironmentaswellasbetteraccesstomarketsandfinancethatwouldallowtheprivatesectortoplayacentralroleindeliveringmarketsolutions,improvingproductivity,reducingcosts,stimulatingtechnologicalinnovation,andfillingthefinancialgap.…[Inaddition],trainingandreskillingworkersfromthefossilfuelsectorandprovidingtargetedassistancetothemostaffectedlocalcommunities”69couldensureanequitableenergytransition.EnergypolicyprioritiesAchieve3,300terawatt-hoursofannualrenewableenergygenerationby2025Haverenewablesaccountfor33%ofenergyconsumptionby2025StatedenergytransitiongoalsHaveCO2emissionspeakbefore2030andachievecarbonneutralitybefore2060LowerCO2emissionsperunitofGDPbyover65%fromthe2005levelAchieveover1.2terawattsofwindandsolarpowercapacityby2030Strictlycontrolcoal-firedpowerprojectsduringthe14thFive-YearPlan(FYP),andphasethemdowninthe15thFYPFosteringEffectiveEnergyTransition:2023Edition44KeymacroeconomicandETIdataPopulation(millions)38.25Energyconsumptionpercapita(GJ/capita)312.2GDP($trillions)1.99Netenergyimports(%ofenergyuse)-80.66.7742.78Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)CanadaSystemperformanceTransitionreadiness64.219/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableStabilizingStabilizing202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadiness66.3Countryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:AdvancedeconomiesSource:WorldEconomicForumCountryPeergroupAdvancingEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition45CountryanalysisKeyprogressonETICanadaisthesecond-largestcountryintheworldbylandarea70andranks19outof120countriesontheETI2023.WithanoverallETIscorethathasremainedfairlystableoverthepastdecade,Canadahasconsistentlyrankedamongthetop25,withstrongresultsonsystemperformance.Specifically,Canadaisagloballeaderontheequitableandsecureaspectsofenergytransition,asitisamajorproducerandexporterofoil,gas,hydroelectricityanduranium,andhasagrowingrenewablessector.Inrecentyears,however,Canadahasfallenbehinditspeergroupandchallengesneedtobeaddressedtoacceleratethesustainabilityofitsenergysystem.Thecountryfaceshighenergyintensityofitseconomy,highlevelsofenergyconsumptionpercapitaandhigher-than-averagecarbonintensity.Withintransitionreadiness,Canadahasshownincreasingimprovementonregulationandpoliticalcommitment.Infact,thecountryisleadingwithboldmeasureswhicharecriticalforaneffectiveenergytransition,resultinginstrongscoreswithincountrycommitments.KeyimperativesandpoliciesinplaceCanada’svastgeographyposeschallengesfortransitioningtorenewableenergy,asmanyofthecountry’sremoteandnortherncommunitiesrelyondieselgeneratorsforelectricity,whichareexpensivetooperateandemithighlevelsofGHGs.Buildingrenewableenergyinfrastructureintheseareascanbecostlyandlogisticallychallenging.Tobetterunderstandenergyusageandengagewiththesecommunities,thefederalgovernmentlaunchedtheRemoteCommunitiesEnergyDatabasein2018.71Byprovidingvaluableinsightsintoenergyconsumptionpatternsandopportunitiesforrenewableenergydevelopment,thedatabasehelpstoshapethedevelopmentofeffectiveenergypoliciesandprogrammesaswellassupportthetransitiontoalow-carbon,sustainableenergysystem.EnergyproductionanduseinCanadacurrentlyaccountsforover80%ofitsGHGs.72Productionfromoilsandsishighlyemissions-intensive,requiringlargeamountsofenergyandwaterforextractionandprocessing.Toreduceemissions,thefederalgovernmentimplementedacarbonpricingschemein2019,targetingarangeofemissionsincludingfuelcombustion,industrialprocessesandwastedisposal.ThecarbonpriceinMay2022stoodatCAD50pertonneofCO2emittedandissettoincreasetoCAD170pertonneby2030.73Industryitselfisalsotakingstepstoreduceemissions,withoilandgascompaniesinvestingincarboncaptureandstoragetechnology.Furthermore,thefederalgovernment’slaunchingoffunds,suchastheLowCarbonEconomyFund(inwhichthegovernmentisinvestinganotherCAD2.2billionforsevenyears,beginningin2022-2023)74andtheCanadaInfrastructureBank’sstrategytoinvestCAD35billion,75providessupportforrenewableenergyprojects,energyefficiencymeasures,andresearchanddevelopment.IndigenouscommunitiesplayasubstantialroleinCanada’senergytransition.Tofostercollaborationandpartnershipbetweenthosecommunitiesandtheenergysector,thegovernmenthasestablishedvariousprogrammesandinitiatives,includingtheIndigenousOff-DieselInitiative,whichwaslaunchedin201876andaimstotransitionremoteindigenouscommunitiesfromdiesel-poweredelectricitytocleanerenergysources.Italsoseekstoenhancethecapacityofindigenouscommunitiesthroughtraining,technicalsupportandotherresourcesrequiredtodevelopandoperatetheirenergyprojects.What’snext?Likeothermajoroil-andgas-exportingnations,Canada’senergyinfrastructurewasdesignedtoprimarilysupportfossilfuelproductionanddistribution,makingitchallengingtointegraterenewableenergyintothegrid.OneaspectofCanada’senergytransitionisitsrelianceonhydroelectricity,whichalsomeansitselectricityis83%non-emittingandamongthecleanestintheworld.77Manyofthehydroelectricfacilities,however,arelocatedonornearIndigenouslands,whichcouldaffecttheexpansionofhydropowerintheseareas.Throughcarefulplanning,investmentandcommunityengagement,CanadacouldaccelerateitstransitiontowardsacleanenergyfutureandmeetitsGHGemissionsgoals.OthercountriesatsimilarlevelsofcleanenergydevelopmentcouldlearnfromCanada’strajectory.EnergypolicyprioritiesCutbuildingenergywastethroughenergyefficiencyandfuelswitchingRapidlyscaleupexistingandnewstrategiccleantechnologiesandthemarketforcleanfuelsStatedenergytransitiongoalsReduceemissionsby40-45%below2005levelsby2030Achievenet-zeroemissionsby2050Pricecarbonpollution,increasingthebenchmarkpriceby$15/ton/year,startingin2023,risingto$170/tonin2030Phaseoutcoal-firedpowerplantsby2030FosteringEffectiveEnergyTransition:2023Edition46KeymacroeconomicandETIdataPopulation(millions)125.7Energyconsumptionpercapita(GJ/capita)127.6GDP($trillions)4.94Netenergyimports(%ofenergyuse)89.73.1961.43Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)JapanSystemperformanceTransitionreadiness63.327/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableAdvancing202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadiness66.3LeadingAtriskCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:AdvancedeconomiesSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition47CountryanalysisKeyprogressonETIJapanranks27outof120countriesontheETI2023,withrelativelystableoverallETI,systemperformanceandtransitionreadinessscoresoverthepast10years.Atanaturaldisadvantageduetoitshighdependenceonenergyimports,Japanmaintainshighscoresonthesecuredimensionwithinsystemperformancethroughthediversificationofenergysourcesaswellasimportcounterparts.Thecountryhasnotablyacceleratedwithinthesustainabledimension,primarilybyreducingtheenergyintensityofitseconomy,aresultofsustainedeffortstoenhanceenergyefficiencyandproductivityacrossdifferentdemandsectors.TheenablingenvironmentforenergytransitioninJapanhassteadilyimproved,evidencedbystrongregulationandpoliticalcommitment,infrastructure,andinvestmentsinhumancapitalandeducation.Therecentannouncementofnet-zerotargetsprovidesfurthermomentumtotheenergytransitionbutwillrequiresector-specificroadmaps,includingforhard-to-abatesectors,withinterimmilestonestoensuretimelyprogress.KeyimperativesandpoliciesinplaceFollowingthe2011Fukushimadisasterandthecountry’sheavyrelianceonimportedfossilfuelsatahugecost,severalpolicieswereintroducedtoincreaseJapan’suseofrenewableenergysources,whilealsopromotingenergyefficiencyandconservationtosecureitsenergytransition.Thisisreflectedinthecountry’shighETIscoresonregulationandpoliticalcommitment.TheSixthStrategicEnergyPlan,releasedinOctober2021,setatargetforrenewablestoaccountfor36-38%ofJapan’senergymixby2030.78Thisdecisionacceleratedthedeploymentofsolar,wind,andhydropower.79Tomeetthetarget,thetotalinstalledcapacitywouldneedtoincreaseby94GW,withthemajoritycomingfromsolarphotovoltaic.Japanisadenselypopulatedcountry,however,withlimitedavailablelandforlarge-scalerenewableprojects.Toovercomethesechallenges,Japanestablisheditselfasaleaderinfloatingsolarpower,utilizingitsinlandlakesandreservoirsforthispurpose.80InDecember2022,thecountryannounceditsplantorestartnuclearpowerplantstohelpaddressitsshortageofenergyandpursuelow-carbondevelopment.Feed-intariffswereintroducedin2012topromotethedevelopmentofsolar,windandbiomass.ThetariffsforsolarstartedatmorethanJPY40/kilowatt-hour(kWh)in2013andwerereducedsteadilytoJPY21/kWhfor2020-2021toencouragegreatercostcompetitivenesswhilealsoreducingthefinancialburdenonconsumers.81Inaddition,anauctionsystemforrenewableenergyprojectswasintroducedtofurtherpromotecostefficiencyandcompetitiveness.Japan’sgridinfrastructure,whichwastraditionallydesignedforcentralizedpowergenerationfromlargepowerplants,requiressignificantupgrades(transmissionanddistributionlosseshaveincreased16%since2014).82Asaresult,thegovernmentisfocusedondevelopingamoredistributedanddiverseenergysystem,whichincludesmicrogrids,energystoragesystemsanddemandresponsetechnologies,whilealsoprovidingsubsidiesandotherincentivestosupportthedevelopmentofenergystorageprojects.Toencourageenergyefficiencyandconservation,theTopRunnerProgrammewasimplementedtosetenergyefficiencystandardsandencouragemanufacturerstodevelopmoreefficientproducts,reducingJapan’srelianceonimportsandimprovingitsenergysecurity.Tofurtherlimititsemissions,Japanalsoimposesacarbontaxonfossilfuelsusedbypowercompaniesandindustrialfacilities,andacarbonemissionstradingsystemforlargeemitters,withacommitmenttoincreasethecarbontaxrateovertimeandexpandtheemissionstradingsystemtocovermoreindustriesandfacilities.What’snext?Japan’senergytransitiondiffersfromothercountriesduetoitslackofnaturalresourcesandspaceforrenewablesaswellasitshistoricalrelianceonnuclearpower.Whilethecountryhasbecomeaglobalpioneerinhydrogenandhasmadeimportantprogresstowardsdevelopinganefficient,resilientandsustainableenergysystem,areportbytheIEA83examinesJapan’senergyissuesandrecommendssolutionstohelpthecountryattainasecure,affordableandsustainableenergyfuture.Thesolutionscoveracceleratingtheuseoflow-carbontechnologies,removingregulatorybarrierstoencourageinvestmentsinzero-emissionselectricityandimprovepowersystemflexibility,andincreasingcompetitioninitsenergymarkets.EnergypolicyprioritiesAchieve36-38%energygenerationfromrenewablesby2030Decreasenuclearenergydependenceto20%andfossilfuelenergygenerationto56%by2030StatedenergytransitiongoalsReduceGHGemissionsby46%by2030comparedto2013Achievecarbonneutralityby2050Imposeenergy-savingmeasurestoimprovetheactualenergyefficiencyby35%Promotehydrogen/energystorageanddecentralizedenergysystemsFosteringEffectiveEnergyTransition:2023Edition48KeymacroeconomicandETIdataPopulation(millions)273.8Energyconsumptionpercapita(GJ/capita)35.94GDP($trillions)1.19Netenergyimports(%ofenergyuse)-86.03.1254.47Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)IndonesiaSystemperformanceTransitionreadiness55.855/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainable202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessAdvancingStabilizingLeadingCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:EmerginganddevelopingAsiaSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition49CountryanalysisKeyprogressonETIIndonesia,asthelargestenergyconsumerinSouth-EastAsia84andasourceofrisingenergydemand,holdsthekeytoeffectiveenergytransitionintheregionandranks55outof120countriesontheETI2023.ThecountryhasimproveditsETIscorebyalmost14%since2014,withthebiggestimprovementintransitionreadiness(55%),supportedbyinfrastructureandregulationandpoliticalcommitment,whichremaincriticalenablersoftheenergytransition.Withinsystemperformance,Indonesia’sscoresontheequitabledimensionhaveshownthemostimprovement,withthebiggestpushcomingfromaccesstoelectricity.ThoughIndonesiaisstilloneofthelargestproducersofcoalandthefifth-largestGHGemitter,85thecountryhasbeenshiftingactivelytowardsscalinguprenewableenergyinrecentyearsand,withcontinuedmomentum,iswellpositionedtosetprioritiestolimitglobalwarmingto1.5°C.KeyimperativesandpoliciesinplaceSustainableenergytransitionwasoneofthemainthemesofIndonesia’sG-20presidencyin2022,includingtherecognitionthatwithoutenergyaccessitwouldbeimpossibletoachieveaneconomy-wideenergytransition.Indonesiachampionedanewtargetforamodernenergyminimumthataimstobettercapturethelinkbetweenenergyconsumptionandeconomicgrowth.Thenewthresholdraisesthebarforminimalenergyto1,000kilowatt/hour(kWh)perpersonperyear,withatleast300kWhathomeand700kWhconsumedinthewidereconomy,ensuringthatinternationaleffortstoendenergypovertyultimatelyresultinmeaningfuldevelopmentoutcomes.86Inaddition,aJETPforIndonesiawaslaunchedtomobilize$20billioninpublic-andprivate-sectorfinancingoverathree-tofive-yearperiodtofacilitatethecountry’stransitionfromcoaltorenewableenergy,reducepower-sectoremissionsandachievenetzeroby2050.Itlaysoutastrategyforthecountrybasedontheexpansionofrenewablesintheenergymix(34%by2030),thereductionofon-andoff-gridcoal-firedelectricitygeneration,andadditionalcommitmentstoregulatoryreformsandenergyefficiencywhileimplementingtangibleactionstoattainanequitableenergytransitionforworkersandcommunities.87QuickeningthedeploymentofrenewableenergycapacitywillbeanimportantstepforIndonesiatoboostitsenergysecurityandreduceitsrelianceonfossilfuelimports.Presidentialdecreeno.112/2022ofSeptember2022highlightsmeasurestopromoterenewableenergy,includingestablishingacompetentpricingregimeforrenewableenergysources,taxincentivesforrenewableenergyprojectsandchangingthenegotiationprocesstoreachapricingagreement.88BasedonthesuccessofitsG-20presidencyandaschairoftheAssociationofSoutheastAsianNations(ASEAN)in2023,Indonesiaaimstoimplementseveralenergysectormeasures,includingstrengtheningtheASEANpowergridtosupporttheenergytransitionandensureenergysecurityintheregion;developinganASEANenergysecurityroadmap;stimulatingsustainableenergyfinancing;buildingregionalecosystemsforelectricvehicles;exploringthepotentialofemergingcleanenergyinnovationstoimproveenergyaccessinislandsandremotegrids,aswellasemissionstradingschemesandcarbonoffsetplatforms;assessingbioenergypotential;andpromotingsmartandintegrateddigitalenergymanagementinindustrial,commercialandbuildingsectors.89What’snext?ThoughIndonesiahastakensignificantstepsinternationallyandregionallytoacceleratetheenergytransition,achievingitsraisedambitionswillnotbeeasy.Intheabsenceofdirectsubsidies,thecurrenttariffmechanismdoesnotallowrenewableenergyprojectstocompetefairlywithfossilfuel-basedinfrastructure,limitingtheirfinancialviability.Furthermore,discrepanciesinplanningandpolicyconsiderationsandalackoftransparency,addalayerofcomplexityforinvestors.TheWorldEconomicForumpolicypaper,“PolicyOpportunitiestoAdvanceCleanEnergyInvestmentinIndonesia”,outlinesrecommendationsthatcouldhelpunlockIndonesia’scleanenergyfuture.Theseincludecreatingarenewableenergytariffregime;removingregulatorybarriersandimplementingstableframeworkstofacilitatetheuptakeofcorporaterenewableelectricitysourcing;workingwithutilitiesorelectricitysupplierstoacceleratethegrowthofrenewableenergyinfrastructure;implementinglegislativeandincentivemechanisms;andenhancingthetransparency,sustainabilityandadditionalityofrenewableenergycertificatestofinancenewrenewableenergycapacity.90EnergypolicyprioritiesPeakemissionsat290metrictonnesCO2andrenewableenergyshareofpowergenerationat34%by2030Deployenergyefficiencymeasuresandelectrificationtools,technologiesandreformsStatedenergytransitiongoalsReduceemissionsby31.9%(unconditional)and43.2%(conditional)by2030comparedtobusinessasusualAchievenet-zeroemissionsby2060orsoonerRetirecoal-firedpowerplantsearlyandrestrictthedevelopmentofcaptivecoal-firedplantsDeveloplocalindustryinrenewableenergyandenergyefficiencyFosteringEffectiveEnergyTransition:2023Edition50KeymacroeconomicandETIdataPopulation(millions)35.95Energyconsumptionpercapita(GJ/capita)267.4GDP($trillions)0.83Netenergyimports(%ofenergyuse)-164.06.2350.25Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)SaudiArabiaSystemperformanceTransitionreadiness55.357/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableStabilizingLeading202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadiness66.3AdvancingCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:MiddleEast,NorthAfricaandPakistanSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition51CountryanalysisKeyprogressonETISaudiArabiaranks57outof120countriesontheETI2023.Thecountryhaslongbeenadominantplayerintheoilmarket,andinrecentyearshasundergoneasignificantenergytransition,recognizingtheneedtoshifttowardsrenewableenergyandreduceitscarbonfootprint.Overthepast10years,SaudiArabiahasshownan11%improvementinitsoverallETIscore,includingbothsystemperformanceandtransitionreadiness.ItleadstheMiddleEast,NorthAfricaandPakistanpeergroupandrankshighlyinboththesecureandequitabledimensions.Althoughitssustainablerankingismakingprogress,thereisstillroomforimprovement,particularlyinreducingenergyandcarbonintensity.Toachievethis,measuressuchasexpandingrenewableresourcesandusingcarboncapturetechnologiescouldbeimplemented.Withintransitionreadiness,significantprogresshasbeenmadeonregulationandpoliticalcommitment.KeyimperativesandpoliciesinplaceSaudiArabia’sVision2030waslaunchedin2016andaimstodiversifythecountry’seconomicresourcesandhelpitbecomemoresustainable.ThroughtheVision,theKingdomseekstodiversifynon-oilexportsandincreaseitsshareofnon-oilGDPfrom16%to50%by2030.91TheKingAbdullahPetroleumStudiesandResearchCentermaintainsthat“non-oilexportsareanimportantcomponentofSaudiArabia’seconomicdiversification,astheycanplaycrucialrolesinsustainableeconomicdevelopmentandjobcreation”.92Accordingtooneanalysis,“hydrogenproductionwouldallowSaudiArabiatobecomelessreliantondomesticoilasakeysourceofincome”93andwoulduseitsexistingoilandgasinfrastructureandsupplychainnetworks.SaudiArabia’sNationalHydrogenStrategy,targeting4milliontonnesperyearofcleanhydrogen,94aimstomakethecountryaleaderinitsproductionandexport.ThePublicInvestmentFund(PIF)hasinvestedinseveralhydrogen-relatedprojects,includingajointventurewithAirProductstobuilda$5billiongreenhydrogenplantinthecountry.95InOctober2022,PIFalsosuccessfullyauctioned1.4milliontonsofcarboncredits,makingitthefirstvoluntarycarbonmarketintheregion.96Thecountry’sshifttowardsrenewables,with11.4GWcapacityunderdevelopment,97representsasignificantdeparturefromthetraditionaleconomicmodelandmayhavegeopoliticalimplications.DespitetheobjectiveofreducingfossilfuelsubsidiesunderVision2030,SaudiArabiastillhadtheworld’sthird-largestsubsidiesin2019atnearly$30billion,primarilydirectedtowardsoil,fossil-fuelelectricityproductionandnaturalgas.98Cheap,availablefossilfuelsreduceincentivesforinvestmentsinrenewableenergytechnologies,ascompaniesandinvestorsmayviewthemaslessfinanciallyviable.Launchedin2021,theSaudiGreenInitiative(SGI)describesitselfas“steeringtheimplementationofasustainablelong-termclimateactionplan.ThreeoverarchingtargetsguideSGI’swork–emissionsreduction,afforestation,andlandandseaprotection.”99By2030,theKingdomhaspromisedthat50%ofitsenergywillcomefromrenewablesources,andSGIisleadingseveralambitiouseffortsthatwillloweremissionsandchangethedomesticpowermix,includingcreatingaprogrammeforcarboncaptureandstorage(CarbonCircularEconomy),increasingenergyefficiency(SaudiArabiaEnergyEfficiencyProgramme)andinvestinginnewenergysources.What’snext?TheKingdomhasbeeninvestinginresearchanddevelopmenttosupportnewsolarandwindtechnologiesandimprovetheefficiencyandcost-effectivenessofexistingtechnologies.Therenewablepowersectorencountersvariouschallenges,however,includingashortageofskilledhumanresources.Inaddition,oilexportsremaincentraltotheKingdom’seconomicdevelopmentandexportportfolio;SaudiArabiaaimstoexpanditsoilproductioncapacityto13millionbarrelsperdayby2027.100Whilethismaymaintainthecountry’spositionasareliableandversatileglobalsupplierinavolatilemarket,101theadditionalproductionandrelatedrevenuesalsoprovideanopportunitytoinvestinanddeveloptechnologiesthatcancapturegeneratedemissionstoensuretheKingdommeetsitsemissionreductiontargets.Inaddition,SaudiArabiacanbecomeanevenstrongerleaderoftheenergytransitionintheregionbydevelopingjointinvestments,researchprogrammes,trainingandeducation,aswellasincentivesthathelpacceleratethemovetoelectrification,energyefficiencyanduseofhydrogen.EnergypolicyprioritiesAchieve50%renewableenergyintheenergymixby2030TransformJubailandYanbuintoglobalhubsforcarboncapture,usageandstorageAchieve50%electricitygenerationfromnaturalgasby2030StatedenergytransitiongoalsReduceandavoidGHGemissionsby278milliontonnesofCO2eannuallyby2030Achievenet-zeroemissionsby2060Improveandraisetheefficiencyofenergyconsumptionintargetedsectors(SuperEfficientEquipmentProgrammeby2025)Reduceglobalmethaneemissionsby30%by2030relativeto2020levelsFosteringEffectiveEnergyTransition:2023Edition52KeymacroeconomicandETIdataPopulation(millions)9.36Energyconsumptionpercapita(GJ/capita)370.9GDP($trillions)0.42Netenergyimports(%ofenergyuse)-148.05.4852.48Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)UnitedArabEmiratesSystemperformanceTransitionreadiness54.663/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainable202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessStabilizingLeadingAtriskCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:MiddleEast,NorthAfricaandPakistanSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition53CountryanalysisKeyprogressonETITheUnitedArabEmirates(UAE),amajoroilandgasproducerandexporter,ranks63outof120countriesontheETI2023.Overthelast10years,theUAE’sETIscorehasfluctuated,mainlyduetothetransitionreadinessdimension,buttheoveralltrendsuggestsagradualstrengtheningoftheenablingenvironmentfortheenergytransition.TheUAEperformsstronglyonregulationandpoliticalcommitment,whichremainsacriticalenableroftheenergytransition.Inaddition,progressonsystemperformanceremainsstrong,althoughprogresswithinthesustainabledimensionisslowing.Furtherimprovementscanbeunlockedbytargetingareductioninenergyintensityaswellascarbonintensityoftheenergymix.KeyimperativesandpoliciesinplaceTheUAEhasinvested$40billionincleanenergyinthepast15years,102whichtranslatesintosignificantstridestopromoterenewablesourcesofenergy.Morethan$160billionisexpectedtobeinvestedtoachievenetzeroby2050,103whichwillseetheUAEcontinuetoshiftitsenergymixtowardsrenewables,reduceGHGemissionsandimproveenergyefficiencyacrosssectors.ThenationalRenewableEnergyStrategy2050waslaunchedin2017toincreasetheshareofrenewablesinthetotalenergymixto50%by2050.104Thecountryhasmadesignificantprogresstowardsachievingthistargetbyinvestingheavilyinrenewableenergyprojectsandishometooneoftheworld’slargestsingle-sitesolarpowerplants,theMohammedbinRashidAlMaktoumSolarPark,covering76km2.Thesolarparkcurrentlygenerates1.63GWandoffsetsroughly1.4milliontonnesofCO2emissionseveryyear,anditscapacitywillexpandto5GWby2030.105,106TheAbuDhabiNationalOilCompanyalsoannounceda$3.1billioninvestmenttoexploreandimplementcarboncaptureandstoragetechnologyinitsoperations,seekingtocapture5milliontonnesofCO2annuallyby2030.107WhilethenetresultsoftheseeffortsarereflectedinUAE’shighETIscoresonregulationandpoliticalcommitmentanddecarbonizedenergy,muchmoreremainstobedonetoreducetheUAE’shighemissionspercapitaglobally.108TheUAElaunchedtheNationalWaterandEnergyDemandManagementProgrammein2022“toimprovetheenergyefficiencyofthethreemostenergy-intensivesectorsinthecountry,namelytransport,industryandconstruction,by40%in2050.Itwilllaunchseveralinitiativestocutenergydemandby40%,toraisetheshareofrenewablesintheenergymixto50%andtoboostwaterreuseby95%”.109Newlyimplementedbuildingcodesandregulationsrequirecertainenergystandardstobemet,suchastheuseofenergy-efficientappliancesandequipment.TheEmiratesEnergyEfficiencyStrategywillretrofit30,000existingbuildingsinDubaiby2030,abating1milliontonnesofCO2.110TheUAEisalsopromotingpublictransport,alternativefuelsandelectricvehicles,withtheintentionofhaving42,000electricvehiclesby2030.111AcarbontradingexchangeandcarbonclearinghousewasannouncedinAbuDhabiin2022toattractinvestmentincarbonemissionsreductionbyallowingcompaniestotradeandfinancecarboncredits.Therevenuegeneratedfromthecarbonpricingsystemwillbeusedtosupportrenewableenergyandenergyefficiencyprojects.TheUAEhasalsoinvested$2billioninnewdesalinationplants;112thesearehighlyenergyintensive,however,andcontributetoGHGemissions,whichinturndrivestheneedformorecleanenergy.What’snext?TheenergysectorhasbeenanimportantenablerofeconomicdevelopmentandgrowthintheUAE,accountingforapproximatelyathirdofitsGDP.Likeothermajorexportingnations,theUAEhastraditionallyreliedonitsoilandgasresourcestofuelitseconomy,butastheworldtransitionstowardscleanerenergysources,demandforfossilfuelswilldeclineovertime.ThecostofUAE’srenewableshasbeendecreasingrapidlyinrecentyears,makingthemincreasinglycompetitivewithfossilfuels.ThisprovidesanopportunityfortheUAEtodiversifyitsenergyexportstoincludecheaprenewableenergy,cleantechnologyandservicestoensureitmaintainsitspositionasaleadingenergyexporterwhilealsosupportingitsownenergytransitiongoals.TheUAE’snaturalresourceendowment,legacyenergyinfrastructureandavailabilityofskilledlabour,duetoinvestmentineducationandtrainingprogrammes(up30%overthedecade),positionitfavourablyinthenewenergylandscapeandprovideareferencepointforcountriesatsimilarlevelsofcleanenergydevelopment.EnergypolicyprioritiesAchieve50%shareofcleanenergy(renewablesandnuclear)intheinstalledpowercapacitymixby2050Reduceenergydemandinthetransport,buildingandindustrialsectorsby40%by2050StatedenergytransitiongoalsReduceemissionsby31%by2030comparedtobusinessasusualAchievenet-zeroemissionsby2050Createaconduciveenvironmentforindustriesofthefuture,includinghydrogenFosteringEffectiveEnergyTransition:2023Edition54KeymacroeconomicandETIdataPopulation(millions)1407Energyconsumptionpercapita(GJ/capita)26.15GDP($trillions)3.18Netenergyimports(%ofenergyuse)37.44.2756.82Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)IndiaSystemperformanceTransitionreadiness54.367/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainable202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessAdvancingAdvancingAdvancingCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:aRelevantWorldEconomicForumpeergroup:EmerginganddevelopingAsiaSource:WorldEconomicForumCountryPeergroupNote:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition55CountryanalysisKeyprogressonETIIndiaranks67outof120countriesontheETI2023,steadilyimprovingacrossthethreedimensionsoftheenergytriangleoverthepastdecade.Achievinguniversalaccesstoelectricity,replacingsolidfuelswithcleancookingoptions(primarilyliquefiedpetroleumgas)andincreasingrenewableenergydeploymenthavebeenprimarycontributorstotheimprovementofIndia’sETIperformance.Indiaalsoemergedrelativelylessaffectedfromtherecentenergycrisis,largelyduetothelowshareofnaturalgasinpowergenerationandincreaseduseofexistinggenerationcapacities.Withrisingenergydemand,India’senergyimportshaveincreasedintandem.Althoughthecountrymaintainsawell-diversifiedmixofenergytradepartners,risingimportdependencerepresentsariskamidglobalenergymarketvolatilities.Theenergysector’ssustainabilityprofilehasimproved,duetothereducedenergyintensityandtheincreasingshareofrenewableenergy.Theenergymix,however,remainspredominantlycarbonintensive,withalowshareofcleanenergyinfinaldemand.Improvementsintheenablingenvironmenthavebeendrivenbypoliticalcommitment,anambitiousreformagenda,infrastructureinvestmentsandacompetitiverenewableenergylandscape.KeyimperativesandpoliciesinplaceSince2000,India’senergyconsumptionhasmorethandoubled.Asthefastest-growingmajoreconomy,thistrendisexpectedtocontinue.AtCOP26,Indiacommittedtoachievingnet-zeroemissionsby2070andraiseditsambitioninitsrevisednationallydeterminedcontributiontoreduceemissionintensityby45%from2005levelsandattain50%ofcumulativenon-fossilfuelpowergenerationcapacityby2030.113DecarbonizationofpowergenerationandelectrificationoffinaldemandarekeyleversofIndia’senergytransition.Theshareofrenewableenergyinpowergenerationhassteadilyincreasedtomorethan30%,withsolarandonshorewindaccountingfor92%ofincrementalcapacityin2022.114India’scommitmenttoinstall500GWofnon-fossilfuelpowergenerationcapacityby2030,115however,willrequireasubstantialincreaseininvestmentsandthemodernizationofthegridinfrastructure.Thefinancialsustainabilityandoperationalefficiencyofthedistributionsectoriskeytounlockingfastergrowth.Indiaisimplementingtheworld’slargestsmartmeteringprogramme,withthetargettoreplace250millionconventionalmeterswithsmartmeters.StrengtheningfinancialperformanceandimprovingcompetitivenessofdistributioncompaniesisthefocusoftheproposedElectricity(Amendment)Bill2022.116Interregionaltransmissioncapacity,whichincreasedrecentlyto112GW,117willenablebetteruseoftheunevenlydistributedrenewableenergypotential.Gridlossesamounttomorethan15%ofgeneratedelectricity,whichcanbeabarrierforgrowthofrenewableenergy.Beyondsupply,Indiahasinitiatedprogrammesforenergyefficiencyandthedecarbonizationofkeydemandsectors.TheEnergyConservation(Amendment)Bill2022introducesrenewableenergymandatesforlargeenergy-intensiveconsumersandproposesacarboncreditstradingscheme.ThroughtheNationalGreenHydrogenMission,Indiaaimstofacilitatedemand,productionanddistributionofgreenhydrogen,andestablishacompetitiveGreenHydrogenecosystem.Furthermore,IndiahasalsoannouncedtheLifestyleforEnvironment(LiFE)initiativetonudgeindividualandcollectiveactiontowardssustainableconsumption.What’snext?IndiaistheonlymajoreconomywithenergytransitionmomentumacceleratingacrosstheETI’sequitable,secureandsustainabledimensions.Thepaceofthermalpowerplantexpansionhasconsiderablyslowed,thoughstrategiesforearlyretirementorrepurposingoftheexistingfleetwillbecrucial.Continuedprogresswillbechallengedbytwokeymacrotrends:strongeconomicgrowth,andtheurgencytocreatequalityjobsforagrowingworking-agepopulation.Manufacturingexportsareplayinganincreasingroleintheeconomy,althoughtheshareoflow-carbonproductsindomesticmanufacturingandexportsremainslow.Developinggloballycompetitivemanufacturingexpertiseinemerginglow-carbonnichetechnologiescouldbeastrongvehicleoffuturegrowth.Askilledworkforce,public-privatecollaborationininnovation,andinvestmentinresearchanddevelopmentinlow-carbontechnologiesarenecessarytoenableIndia’senergytransition.EnergypolicyprioritiesDeveloplow-carbonelectricitysystemsDevelopanintegrated,efficientandinclusivelow-carbontransportsystemPromoteadaptationinurbandesign,energyandmaterialefficiencyinbuildings,andsustainableurbanizationStatedenergytransitiongoalsReduceemissionintensityofGDPby45%by2030fromthe2005levelAchievenet-zeroemissionsby2070Achieve50%cumulativeelectricpowerinstalledcapacityfromnon-fossilfuel-basedenergyresourcesby2030Decouplegrowthfromemissionseconomy-wideEmployCO2removalandrelatedengineeringsolutionsFosteringEffectiveEnergyTransition:2023Edition56KeymacroeconomicandETIdataPopulation(millions)59.39Energyconsumptionpercapita(GJ/capita)88.75GDP($trillions)0.42Netenergyimports(%ofenergyuse)-18.86.9274.37Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)SouthAfricaSystemperformanceTransitionreadiness52.282/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainableLeadingAdvancing202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessAtriskCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyNote:aRelevantWorldEconomicForumpeergroup:Sub-SaharanAfricaSource:WorldEconomicForumCountryPeergroupEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition57CountryanalysisKeyprogressonETISouthAfrica,thesecond-largesteconomyinAfrica,hasalargeenergysectorandranks82outof120countriesontheETI2023.ThecountryhasimproveditsoverallETIscoreby6%since2014.SouthAfrica’ssystemperformancescoreshaveimproved,supportedbybetterperformanceinenergyaccess,electricityandcleancookingfuels.Whilescoresinthesustainabledimensionareacceleratingduetothereducedenergyintensity,significantchallengesremain.TheenergytransitioninSouthAfricahashistoricallybeenanuphillbattle,eventhoughtheshareofrenewableenergyhasincreasedoverthepast10years.Thecountrystillderivesabout70%ofitselectricityfromcoal,thecarbonintensityoftheenergymixremainshigh,andcleanenergysourcesonlyconstitutearound13%ofthetotalenergymix.118KeyimperativesandpoliciesinplaceRecentannouncementsfornet-zeroemissionsby2050constitutestepsintherightdirectionandindicatetheincreaseinpoliticalcommitmentandstrengtheningregulatoryenvironment.Severalpolicydevelopmentsandmeasureshavebeenputinplacetohelpthecountryaccelerateitscleanenergytransition.AsreportedbyGlobalComplianceNews:“AtCOP27inNovember2022,SouthAfricalauncheditsnewJustEnergyTransitionInvestmentPlan(JETIP)andannouncedafive-yearinvestmentplanforthe$8.5billionfinancingpackage,whichwasannouncedaspartofthecountry’sJustEnergyTransitionPartnershipwithFrance,Germany,theUnitedKingdom,theUnitedStatesandtheEuropeanUnionatCOP26.TheJETIPisalignedwiththeCabinet-approvedNationalJustTransitionFrameworkandoutlinestheinvestmentsrequiredtoachievethecountry’sdecarbonizationcommitments,whilepromotingsustainabledevelopment,andensuringajusttransitionforaffectedworkersandcommunities.…TheJETIPcoverselectricity,newenergyvehicles(NEVs)andgreenhydrogen,andidentifies$98billioninfinancialrequirementsoverthenextfiveyears,tocomefromboththepublicandprivatesectors.”119SouthAfrica’sNationalDevelopmentPlan,draftIntegratedEnergyPlanandRenewableEnergyWhitePaperalloutlinethecountry’spolicyfoundationforenergytransition,“anincreasedfocusonadiversifiedenergymixthatincludesrenewableenergy,distributedgenerationandbatterystorage”120andamoveawayfromcarbon-fuelledenergy.TheRenewableEnergyIndependentPowerProducerProcurementProgramme,introducedin2011,wasacompetitivetenderprocessdesignedtofacilitateprivate-sectorinvestmentintogrid-connectedrenewableenergygeneration.Theprogramme’ssixthroundgotunderwayin2022,inlinewiththe2019IntegratedResourcesPlan,aimingtoprocure2.6GWofsolarandwindpower.121Toencouragetheself-generationofrenewableenergy,thegovernmentscrappedthe100MWlicence-exemptionthresholdfordistributedgeneratorsandproposedafeed-intariffforself-generatinghouseholdsandbusinesses.122Moreover,theSouthAfricaHydrogenSocietyRoadmap,publishedinFebruary2022andfocusingonnationalambitions,sectorprioritization,theoverarchingpolicyframeworkandthemacroeconomiceffectofthehydrogeneconomythroughoutSouthAfrica,isanimportantmilestoneforthecountryasitnavigatesitsenergytransition.123What’snext?DebtandmismanagementhaverenderedEskom,apublicelectricityutility,vulnerableandcausedcapacitygapsresultinginload-shedding,frequentelectricityblackoutsandalackofaffordableandsecurepower.Intheimmediateterm,thegovernmenthasputamendmentsinplacetoaddresstheelectricitysupplydeficit.SouthAfrica’senergytransitionneverthelessfaceschallengesinthemediumtolongterm,includingkeyplayersinfluencingpolicyformulationandhavinganincentivetosupportcoal,aswellaseconomicandsocialfalloutfromthelossofjobsandlivelihoodsinthecoalindustry.Roomexiststospeedupactionstodecarbonizetheenergymixthroughenergyefficiencymeasures,thedevelopmentofrenewables,electrification,andtheuseofcarboncapturetechnologies.Still,giventheimportanceofextractiveindustriesinSouthAfrica,additionalopportunitiesexisttoensureanequitabletransitionbycreatingahigh-levelcentralizedbodytomanagetheprocess,engagingallstakeholdersearlyandoften,promotingtransparencyandaccessibilityinthepolicyprocessandformingasupportivelegislativeframework.EnergypolicyprioritiesDecommissiontheretiringcoalgenerationfleet,inlinewitharevisedIntegratedResourcePlanandintandemwiththedevelopmentofrenewableenergygenerationatscaleStrengthentransmissiongridinfrastructuretoaccommodatetheshifttorenewableenergyStatedenergytransitiongoalsReduceGHGemissionsto398-510metrictonnesCO2eby2025,andto350-420metrictonnesCO2eby2030Achievenet-zeroemissionsby2050Buildnew-energyvehiclesupplychainlocalizationandsetthebasefornew-energyvehiclemanufacturingBecomeaworld-leadingexporterofgreenhydrogenFosteringEffectiveEnergyTransition:2023Edition58KeymacroeconomicandETIdataPopulation(millions)213.4Energyconsumptionpercapita(GJ/capita)31.90GDP($trillions)0.44Netenergyimports(%ofenergyuse)-48.06.5513.26Source:WorldEconomicForumEnergyintensity(MJ/$2017PPPGDP)CO2intensity(CO2/TPES)NigeriaSystemperformanceTransitionreadiness46.0108/1208020142015201620172018-6%-4%-2%0%2%4%6%20192020EquitableSecureSustainable202120222023604020Score(0–100)020406080100EquitableSustainableSecure020406080100FinanceandinvestmentInfrastructureInnovationSystemperformanceTransitionreadinessAdvancingAdvancingAtriskCountryandpeergroupasystemperformanceandtransitionreadiness,2014-2023Note:aRelevantWorldEconomicForumpeergroup:Sub-SaharanAfricaSource:WorldEconomicForumCountryPeergroupNote:GJ=gigajoule;MJ=megajoule;PPP=purchasingpowerparity;TPES=totalprimaryenergysupplyEnergytransitioncurrentassessmentMomentumETIScoreRankRegulationsandpoliticalcommitmentEducationandhumancapitalFosteringEffectiveEnergyTransition:2023Edition59CountryanalysisKeyprogressonETINigeriaranks108outof120countriesontheETI2023andisthelargesteconomyandrichestoilresourcecentreoftheAfricancontinent,aswellasthelargestgasconsumerandproducerofWestAfrica.124Overthelast10years,Nigeria’soverallETIscorehasimproved(3%),whileitssystemperformancescoreshavefallenslightly(1%).Thecountry’sgrowingpopulationandarrayofsocio-economicissuesmeanitneedssustainableenergysourcestomeettheincreasingneedsforallsectorsoftheeconomy.Highscoresonregulationandpoliticalcommitment,relativetootherenablingdimensions,areevidencedbythecountry’snotablepower-sectorreformsandplanstoaccelerateitscleanenergytransitionandmeetkeydevelopmentgoals,includingachievingnetzeroby2060.KeyimperativesandpoliciesinplaceNigeria’sClimateChangeAct,whichwassignedintolawinNovember2021,“providesthelegalframeworkandaboldinstitutionalarrangementforactiononclimatechange.TheActestablishedaNationalCouncilonClimateChange,chairedbythePresident,toleadworkundertheActandhelpmainstreamclimatechangeactionintothecountry’sdevelopmentagenda.…ThevitalnextstepisfortheCounciltopublishNigeria’sfirstcarbonbudgetasrequestedbylawandputinplaceeffortstomonitorimplementationandcompliance”,accordingtoglobalthinktankODI125Inaddition,thelaunchofthecountry’sEnergyTransitionPlaninAugust2021setsoutatimelineandframeworkforachievingreductioninemissionsacrossfivekeysectors:power,cooking,oilandgas,transport,andindustry.ThesetwoimportantstepsandarevisednationallydeterminedcontributionarereliablesignsofNigeria’sfuture.Nevertheless,challengesremaintoturnthesecommitmentsintoaction.AsODIpointsout,a“majorobstacletoNigeria’stransitionawayfromfossilfuelsisthehighlevelsofgovernmentsubsidiesfortheirproductionandconsumption.Progressonreformingfossilfuelsubsidieshasbeenchallenging,asconsumersexpectaccessibleenergyandaffordablepricingfromthegovernmentasabenefitofbeingamajoroilproducer”.126Nigeriacurrentlyhasoneofthehighestratesofenergypovertyintheworld.Theelectricityaccessratestandsat25%forruralpopulationsforwhombiomassandwastearetheprimarysourceofenergyforcooking.Conversely,Nigeriahasoneofthehighestcostsofelectricityintheworldatanaverageof$0.52/kWh.127“Developmentfinanceinstitutionsandotherdonors,wealthier,high-emittingcountries,andinternationalNGOsarewell-placedtosupportthisagendathroughfinancingandresearch,andbyencouragingconstructiveengagementonsubsidyreformandjusticeandsocialresponsibilityinenergytransitionmorebroadly.”128Nigeria’senergytransitioncreatessignificantinvestmentopportunities,includingestablishingandexpandingindustriesforsolar,hydrogenandelectricvehicles,andusingitsvastnaturalgasresourcesforeconomicdevelopment.ARenewableEnergyRoadmapwasproducedwiththeInternationalRenewableEnergyAgencyandtheEnergyCommissionofNigeriainJanuary2023that“encompassesallkeysectorsoftheNigerianenergysystemtoprovideadditionalcontextforenergypolicydiscussionsonhowincreasedambitionintermsofrenewableenergy–beyondcurrentgovernmentpolicyandtargets–canberealised”.129What’snext?Overall,theenergytransitioninNigeriastillrequiressignificantinvestmentfromthegovernmentandsupportfromitscitizens.Prioritizingeconomicdevelopment,alongwithproperplanningandstrengtheninginstitutionalandfiscalframeworks,canhelpNigeriaaccelerateitstransition.Basedonlessonslearnedfromothercountries,thegovernmentcouldidentify(andsupport)low-carbonenergysolutions,especiallyintheruralandperi-urbanareasofNigeria;placegreateremphasisoninnovationinnewenergyinfrastructuredevelopment;improveenergyefficiencyinsmallandmedium-sizedenterprises;exploretheeffectiveuseofdomesticfunding;andharmonizedifferentenergypolicyframeworks.TogetherwiththeRenewableEnergyandEnergyEfficiencyAssociations-Alliance,theWorldEconomicForumisengagingkeypublic-andprivate-sectorstakeholderstofurtherunderstandNigeria’senergytransitionpolicyplans,associatedinvestmentbarrierstoacceleratethecleanenergytransition,andpracticalsolutionstoaddressthosebarriers.EnergypolicyprioritiesEnsure48%ofthepopulationuseliquefiedpetroleumgasand13%useimprovedcookstovesby2030Achieve2.5%annualreductioninenergyintensityinallsectorsStatedenergytransitiongoalsReduceGHGemissionsby20%(unconditional)and47%(conditional)by2030comparedtobusinessasusualReduceemissionsby50%fromcurrentlevelsby2050andachievenet-zeroemissionsbetween2050and2070Achieve30%on-gridelectricityfromrenewables,13GWoff-gridrenewableenergy,andreductionofgridtransmissionanddistributionlossesto8%offinalenergyconsumptionby2030Achievezerogasflaringby2030FosteringEffectiveEnergyTransition:2023Edition60AppendicesSystemperformance60%40%33%33%50%50%33%EquitableEnergyaccessEnergyaffordabilityEconomicdevelopmentSupplysecurityResilienceReliabilityEnergyefﬁciencyGHGmitigationCleanenergyRegulationsandpoliticalcommitmentFinanceandinvestmentEducationandhumancapitalInnovationInfrastructureSecureSustainableRegulatoryframeworkandinvestmentEnablingfactorsTransitionreadinessETIscoreSource:WorldEconomicForumA1MethodologyTheETIframeworkanalysescountries’currentenergysystemperformanceandenablingenvironmentforenergytransitioninfiveequallyweightedcomponents:equityandinclusion,security,sustainability,regulatoryframeworkandinvestment,andenablingfactors.MethodologyFIGURE14FosteringEffectiveEnergyTransition:2023Edition61DenmarkFinlandIcelandFranceAustriaEstoniaGermanyBrazilChinaHungaryCanadaAlbaniaAustraliaCostaRicaJapanIsraelChileKorea,Rep.AzerbaijanCroatiaGreeceItalyColombiaIrelandBelgiumCzechRepublicKenyaElSalvadorBulgariaBosniaandHerzegovinaCyprusIndonesiaGeorgiaIndiaJordanArmeniaBoliviaCoted’IvoireKazakhstanEcuadorEgypt,ArabRep.CameroonCambodiaArgentinaAlgeriaGuatemalaGhanaIran,IslamicRep.DominicanRepublicEthiopiaGabonAngolaHondurasKuwaitBruneiDarussalamBotswanaBahrainBangladeshJamaicaCongo,Dem.Rep.Country2014–152015–162016–172017–182018–192019–202020–212021–222022–232014-2023scorechangeAlbania9.28Algeria2.79Angola0.44Argentina2.49Armenia3.84Australia6.12Austria6.82Azerbaijan10.27Bahrain0.09Bangladesh4.63Belgium4.04Bolivia3.83BosniaandHerzegovina9.09Botswana-1.15Brazil4.61BruneiDarussalam-0.37Bulgaria3.33Cambodia7.79Cameroon6.13Canada2.07Chile5.26China12.78Colombia4.4Congo,Dem.Rep.1.27CostaRica2.94Coted'Ivoire16.68Croatia7.08Cyprus8.06CzechRepublic5.79Denmark3.68DominicanRepublic8.68Ecuador3.43Egypt,ArabRep.1.01ElSalvador-1.27Estonia10.58Ethiopia1.93Finland9.7France6.34Gabon0.14Georgia4.45Germany3.86Ghana3.8Greece7.51Guatemala4.56Honduras0.62Hungary12.1Iceland7.18India7.97Indonesia6.87Iran,IslamicRep.1.19Ireland5.44Israel7.58Italy6.31Jamaica2.31Japan3.71Jordan10.49Kazakhstan7.94Kenya10.56Korea,Rep.8.88Kuwait3.62Year-on-yeardeclineYear-on-yearimprovementNochangeA2CountryETIscoreevolution,2014-2023ChangeinETIscoresoverthelastdecadeTABLE3FosteringEffectiveEnergyTransition:2023Edition62SwedenNorwaySwitzerlandNetherlandsUnitedStatesUnitedKingdomPortugalSpainLuxembourgNewZealandUruguayLatviaSloveniaParaguayMalaysiaLithuaniaPolandVietNamSlovakRepublicRomaniaPanamaPeruThailandMoroccoSaudiArabiaNamibiaQatarMauritiusMaltaUnitedArabEmiratesUkraineTurkeySriLankaMexicoMontenegroSingaporeTajikistanSerbiaMacedonia,FYRSouthAfricaLaoPDRTunisiaOmanKyrgyzRepublicPhilippinesNepalTrinidadandTobagoRepublicofMoldovaVenezuelaSenegalPakistanNigeriaMozambiqueMongoliaLebanonNicaraguaZimbabweYemen,Rep.ZambiaTanzaniaCountry2014–152015–162016–172017–182018–192019–202020–212021–222022–232014-2023scorechangeKyrgyzRepublic3.74LaoPDR2.47Latvia8.22Lebanon2.44Lithuania10.88Luxembourg7.66Macedonia,FYR4.15Malaysia5.11Malta9.93Mauritius0.65Mexico1.99Mongolia6.9Montenegro1.53Morocco5.64Mozambique3.22Namibia5.4Nepal4.02Netherlands9.4NewZealand2.6Nicaragua-0.16Nigeria1.3Norway2.99Oman4.79Pakistan5.13Panama1.33Paraguay5.63Peru-1.72Philippines2.13Poland10.52Portugal8.01Qatar2.58RepublicofMoldova8.55Romania1.65SaudiArabia5.33Senegal12.18Serbia4.71Singapore3.24SlovakRepublic7.82Slovenia6.57SouthAfrica3.01Spain8.96SriLanka2.41Sweden6.47Switzerland6.21Tajikistan-1.99Tanzania10.15Thailand5.75TrinidadandTobago-1.3Tunisia3.79Turkey3Ukraine8.06UnitedArabEmirates6.4UnitedKingdom6.68UnitedStates6.3Uruguay3.58Venezuela1.56VietNam6.5Yemen,Rep.1.86Zambia1.29Zimbabwe12.28Source:WorldEconomicForumYear-on-yeardeclineYear-on-yearimprovementNochangeFosteringEffectiveEnergyTransition:2023Edition63DatasourcesBloombergNEF,ClimatePolicyInitiative,ClimateWatch,Ember,Enerdata,Fitchratings,HeritageFoundation,INSEAD,InternationalEnergyAgency,InternationalGasUnion,InternationalInstituteforSustainableDevelopment,InternationalMonetaryFund,InternationalRenewableEnergyAgency,Moody’sratings,OrganisationforEconomicCo-operationandDevelopment(OECD)Statistics,PortulansInstitute,S&Pratings,UNEnvironmentProgramme(UNEP),UnitedNationsConferenceonTradeandDevelopment(UNCTAD)Stats,WoodMackenzieLimited,WorldBankGroup,WorldEconomicForum,WorldHealthOrganization,WorldTradeOrganization.ChiefexpertadvisersTheWorldEconomicForumacknowledgesandthankstheindividualsandexpertswithoutwhosesupporttheFosteringEffectiveEnergyTransition2023Editionwouldnothavebeenpossible:MorganBazilianProfessorofPublicPolicy,andDirectorofPayneInstitute,ColoradoSchoolofMinesLinBoqiangDean,ChinaInstituteforStudiesinEnergyPolicy,XiamenUniversityMichaelaCampanelliHead,ClimateStrategy,RiskMitigation,andDisclosure,EniLucyCraigDirector,InnovationandDigitalization,DNVRabiaFerroukhiDirector,Knowledge,PolicyandFinanceCentre,InternationalRenewableEnergyAgency(IRENA)BertrandMagneSeniorEconomist,EuropeanInvestmentBank(EIB)DavidePuglielliHead,ScenarioPlanningandGroupStrategicPositioning,EnelJohnScottHead,SustainabilityRisk,ZurichInsuranceGroupFridtjofUnanderChiefEconomist,AkerHorizonsDavidVictorProfessorofInnovationandPublicPolicy,UniversityofCalifornia,SanDiego(UCSD)RigobertoArielYepez-GarciaManager,InfrastructureandEnergySector,Inter-AmericanDevelopmentBank(IDB)ProjectteamAccentureMuqsitAshrafGlobalStrategyLeadDavidRableyManagingDirectorandGlobalEnergyTransitionLead,EnergySamikshaSrivastavaConsultant,StrategyandConsulting,EnergyFrancescaTateManager,StrategyandConsulting,EnergyWorldEconomicForumMohammedAlgeerProjectFellow,CentreforEnergyandMaterialsRobertoBoccaHead,CentreforEnergyandMaterials;MemberoftheExecutiveCommitteeEspenMehlumHead,EnergyTransitionIntelligenceandRegionalAcceleration,CentreforEnergyandMaterialsSarahMoinProgrammeAnalyst,CentreforEnergyandMaterialsHarshVijaySinghManager,EnergyandIndustryTransitionIntelligence,CentreforEnergyandMaterialsContributorsFosteringEffectiveEnergyTransition:2023Edition64ProductionLaurenceDenmarkCreativeDirector,StudioMikoSophieEbbageDesigner,StudioMikoGeorgeMesserDesigner,StudioMikoFabienneStassenEditor,EditOrProofOliverTurnerDesigner,StudioMikoFosteringEffectiveEnergyTransition:2023Edition651.InternationalEnergyAgency(IEA),FossilFuelsConsumptionSubsidies2022,February2023,https://www.iea.org/reports/fossil-fuels-consumption-subsidies-2022(accessed17May2023).2.BloombergNEF,“GlobalLow-CarbonEnergyTechnologyInvestmentSurgesPast$1TrillionfortheFirstTime”,26January2023,https://about.bnef.com/blog/global-low-carbon-energy-technology-investment-surges-past-1-trillion-for-the-first-time(accessed19May2023).3.NetZeroInsights,“TheStateofClimateTech‘22”,18January2023,https://netzeroinsights.com/state-of-climate-tech-2022(accessed17May2023).4.IEA,GlobalEVOutlook2023:Catchingupwithclimateambitions,2023,https://iea.blob.core.windows.net/assets/dacf14d2-eabc-498a-8263-9f97fd5dc327/GEVO2023.pdf(accessed17May2023).5.NewClimateInst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es-plans-and-visions/environment-and-energy/uae-energy-strategy-2050(accessed18May2023).105.DubaiElectricityandWaterAuthority,InnovationCentre,“MohammedbinRashidAlMaktoumSolarPark”,17April2023,https://mbrsic.ae/en/about/mohammed-bin-rashid-al-maktoum-solar-park(accessed25May2023).106.MASDAR,“MohammedbinRashidAlMaktoumSolarPark(MBR)SolarPark”,2023,https://masdar.ae/Masdar-Clean-Energy/Projects/Mohammed-bin-Rashid-Al-Maktoum-Solar-Park-Phase-3(accessed25May2023).107.AbuDhabiNationalOilCompany(ADNOC),“ADNOCtoBuildonitsPositionasoneoftheLeastCarbon-IntensiveOilandGasProducersintheWorld”,PressRelease,25February2020,https://www.adnoc.ae/en/news-and-media/press-releases/2020/adnoc-to-build-on-its-position-as-one-of-the-least-carbon-intensive-oil-and-gas-producers#:~:text=ADNOC%20plans%20to%20expand%20the%20capacity%20of%20this,forest%20over%20twice%20the%20size%20of%20the%20UAE(accessed18May2023).108.OurWorldinData,“PercapitaCO2emissions,2021”,https://ourworldindata.org/grapher/co-emissions-per-capita(accessed25May2023).109.Enerdata,“TheUAElaunchesitsNationalWaterandEnergyDemandManagementProgramme”,10August2021,https://www.enerdata.net/publications/daily-energy-news/uae-launches-its-national-water-and-energy-demand-management-programme.html(accessed18May2023).110.Zawya,“Dubaitoretrofit30,000buildingsovernextsevenyears”,1February2023,https://www.zawya.com/en/business/energy/dubai-to-retrofit-30-000-buildings-over-next-seven-years-ksknuvr5(accessed25May2023).111.ArthurD.Little,GlobalElectricMobilityReadinessIndex–GEMRIX2022,August2022,https://www.adlittle.com/sites/default/files/reports/ADL_Global_EM_readiness_index_2022.pdf(accessed25May2023).112.SmartWaterMagazine,“AlMazrouei:UAEtoinvest$2.08billioninnewdesalinationplants”,11May2022,https://smartwatermagazine.com/news/smart-water-magazine/al-mazrouei-uae-invest-208-billion-new-desalination-plants#:~:text=The%20minister%20of%20energy%20in%20the%20United%20Arab,of%20the%20UAE%E2%80%99s%20leadership%20to%20achieve%20water%20security(accessed25May2023).113.GovernmentofIndia,PressInformationBureau,“India’sStandatCOP-26”,PressRelease,3February2022,https://pib.gov.in/PressReleasePage.aspx?PRID=1795071(accessed18May2023).114.Lee,Uni,“SolarandwinddominateIndia’scapacityadditionsin2022”,Ember,17March2023,https://ember-climate.org/insights/research/india-data-story-2023(accessed28May2023).115.GovernmentofIndia,PressInformationBureau,“Indiatakesanotherbigsteptowardsachieving500GWofnon-fossilfuelbasedelectricityinstalledcapacityby2030”,PressRelease,7December2022,https://pib.gov.in/PressReleasePage.aspx?PRID=1881484#:~:text=India%20has%20huge%20ambitions%20in,installed%20capacity%20mix%20by%202030(accessed18May2023).FosteringEffectiveEnergyTransition:2023Edition70116.LokSabhaSecretariat,NewDelhi,“TheElectricity(Amendment)Bill,2022”,LegislativeNote,August2022,https://loksabhadocs.nic.in/Refinput/New_Reference_Notes/English/08082022_123415_1021205203.pdf(accessed25May2023).117.GovernmentofIndia,MinistryofPower,“Transmission”,22May2023,https://powermin.gov.in/en/content/overview-0(accessed25May2023).118.Ziady,Hanna,“SouthAfrica’senergycrisisdeepensasblackoutshit12hoursaday”,CNN,18January2023,https://edition.cnn.com/2023/01/18/energy/ramaphosa-davos-south-africa-blackouts/index.html(accessed25May2023).119.Whyte,Kieran,“SouthAfrica:ThelatestdevelopmentsinJustEnergyTransition”,GlobalComplianceNews,22November2022,https://www.globalcompliancenews.com/2022/11/22/https-insightplus-bakermckenzie-com-bm-energy-mining-infrastructure_1-south-africa-the-latest-developments-in-just-energy-transition_11102022(accessed18May2023).120.Ibid.121.Ibid.122.Creamer,Terence,“Ramaphosadoublesnextrenewablesround,scraps100MWcapondistributedplantandmootsfeed-intariffasheunveilsload-sheddingcrisisresponse”,EngineeringNews,25July2022,https://www.engineeringnews.co.za/article/ramaphosa-doubles-next-renewables-round-to-5-200-mw-scraps-100-mw-cap-on-distributed-plant-and-moots-feed-in-tariff-as-he-unveils-load-shedding-crisis-response-2022-07-25(accessed18May2023).123.Whyte,Kieran,andZahraOmar,“SouthAfrica:HydrogenRoadmap–Acrucialstepintheenergytransitionjourney”,GlobalComplianceNews,20June2022,https://www.globalcompliancenews.com/2022/06/20/south-africa-hydrogen-roadmap-a-crucial-step-in-the-energy-transition-journey080622(accessed18May2023).124.IEA,“Nigeria”,2020,https://www.iea.org/countries/nigeria(accessed18May2023).125.Okereke,Chukwumerije,etal.,“FiveopportunitiesforNigeriatoleadacleanandjustenergytransitionatCOP27andbeyond”,ODI,2November2022,https://odi.org/en/insights/five-opportunities-for-nigeria-to-lead-a-clean-and-just-energy-transition-at-cop27-and-beyond(accessed18May2023).126.Ibid.127.Ashurst,“OilandGasUpdate:Nigeria’sEnergyTransition”,2March2022,https://www.ashurst.com/en/news-and-insights/legal-updates/nigerias-energy-transition(accessed26May2023).128.Okereke,Chukwumerije,etal.,op.cit.129.Izuora,Chika,“AcceleratingEnergyTransitionWithBestTechnology”,LeadershipMediaGroup,February2023,https://leadership.ng/accelerating-energy-transition-with-best-technology(accessed18May2023).FosteringEffectiveEnergyTransition:2023Edition71WorldEconomicForum91–93routedelaCapiteCH-1223Cologny/GenevaSwitzerlandTel.:+41(0)228691212Fax:+41(0)227862744contact@weforum.orgwww.weforum.orgTheWorldEconomicForum,committedtoimprovingthestateoftheworld,istheInternationalOrganizationforPublic-PrivateCooperation.TheForumengagestheforemostpolitical,businessandotherleadersofsocietytoshapeglobal,regionalandindustryagendas.

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