The countries leading the energy transition

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The Scandinavian region is leading the energy transition with the three countries Sweden, Norway and Denmark in the top three spots.

Switzerland and Austria follow in fourth and fifth respectively. The other region in the top 10 is Australasia with New Zealand in eighth place.

Conversely at the lower end are Lebanon, Mongolia, Haiti and Zimbabwe.

The latest annual Fostering Effective Energy Transition from the World Economic Forum and Accenture reports that global investment in the energy transition reached $500 billion in 2020. This represents a doubling over the past decade.

This has seen the share of electricity from renewables including hydro increase from 19% to 26% (in 2019), with the levelised cost of solar declining from $0.38/kWh to $0.07kW/h and of onshore wind from $0.086/kWh to $0.053/kWh.

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Other indicators highlighted are an increase in cumulative global electric vehicle and plug-in sales from 0.5 million in 2010 to 10 million in 2020 and a decline in energy intensity from 5.4MJ/$ to 4.6MJ/$, but an increase in emissions from fossil fuel combustion and industrial processes from 33Gt to 34Gt.

The number of people without electricity is 770 million compared with 1.2 billion a decade ago.

Energy transition index

The study benchmarks 115 countries across the globe according to an ‘Energy transition index’, taking account of factors including the energy system structure, investment, regulation, governance, infrastructure and human capital.

Top level findings are that aggregate scores have risen over the past decade for countries collectively accounting for 86% of global total energy supply and for 88% of global CO2 emissions from fuel combustion.

The ranking of the top countries has remained broadly consistent over the past decade. Denmark, Finland and the United Kingdom, the highest improvers in the top 10 positions, were able to improve their energy system performance and sustainability outcomes thanks to a stable regulatory environment, diversified energy mix and cost-reflective energy pricing.

Countries with rising energy demand, such as China, India and sub-Saharan African nations, have registered the largest gains, but their index scores remain low in absolute terms.

Of the other regions, Latvia is the top ranking country in emerging and developing Europe, Uruguay in Latin America and Caribbean, Singapore in Asia, Georgia in the Commonwealth of Independent States, Qatar in the Middle East and North Africa and Ghana in sub-Saharan Africa – all within the top half of countries.

Advancing the energy transiiton

The report states that despite the strong gains, significant gaps remain. For example the decline in average energy intensity has yet to translate into meaningful gains in carbon intensity and progress has been slow on translating political commitments into actions.

The total amount of electricity generated from coal also has been on an upward trajectory over the past 10 years.

The report indicates three imperatives to increase the resilience of the energy transition.

These are to deliver a ‘just transition’ for all with policy makers prioritising measures to support the economy, workforces and society at large as countries shift to a low carbon energy system, and to accelerate electrification and the scale up of renewables while at the same time developing coordination in the demand side.

There also should be a doubling down on public-private sector collaboration to attract the capital needed for multi-year and multi-decade investments into energy systems.

“Building an effective and resilient energy transition requires all hands on deck,” says the report.

“It is critical to root the energy transition in economic, political and social practices so that progress becomes irreversible.”