Analysis of the Energy Transition Index has shown encouraging progress on the energy transition over the past decade. But more progress is needed. Evolution in areas such as environmental sustainability remains uneven and insufficient, while progress on other dimensions such as economic growth has been mixed. Recent disruptions, whether caused by COVID-19 or the climate, have challenged the resilience of the energy transition. As energy systems become more variable, distributed, and digitalized, new risks are emerging that threaten the reliability, resilience, and affordability of future energy. Understanding how to boost the resilience of the energy transition and identifying the levers required to do so will become increasingly critical during this decade of action and delivery.
Policy-makers, business leaders, and consumers all have a part to play in delivering a balanced, resilient transition which continues to speed progress regardless of disruptions and opposition. While there is no single approach, some common key themes are emerging across different geographies:
Looking ahead, there are two major opportunities which will have profound impacts for the coming decades. First, the unprecedented level of government stimulus to combat the social and economic impacts of COVID-19 could be targeted to build resilience in the energy transition and provide a near-term focus on energy transition. Second, the upcoming COP26 summit in November holds the potential to set the tone and the trajectory for coordinated international action on climate change.
Developments in this decade will be crucial in resetting our economies and in our fight against climate change. Policy-makers and private sector actors must work together and seize the opportunities to build the foundation for a resilient energy transition – one that not only ensures long-term sustainability but also delivers inclusive growth and long-term prosperity.