DNV's view on the Energy Transition
More than "A for effort?"
Risk management experts DNV have just published their annual “Energy Transition Outlook”. Here are the key findings of the report and what they mean for the road ahead:
A peak too weak
Global energy emissions might peak in 2024, but the projected decline is too slow to meet the international climate targets. According to the DNV experts, we are moving towards a temperature rise of 2.2°C by 2100.
Renewables are growing fast, but not fast enough
Especially solar power and batteries are getting cheaper and have seen tremendous growth. Still, renewables as a whole need to grow even faster.
Efficiency gains need to accelerate
Global energy efficiency is improving by 2% annually. However, the goal set at COP28 is an improvement of 4 %.
China is leading the clean tech race
In 2023, China alone installed 58% of global solar power and was responsible for 63% of new EV purchases.
National security vs. energy transition
More and more countries are shifting towards a greater focus on national and economic security. Higher military budgets often lead to less funds available to finance the energy transition.
Stronger energy policies are needed
Market forces alone will not do it. Crucial tools such as carbon pricing still have a long way to go. Incentives for clean tech are not enough. They need to be combined with penalties for high emissions.
Conclusion: Work, work, work, work, work!
While critical, DNV's new "Energy Transition Outlook" highlights encouraging progress in the global shift toward clean energy. Solar power, battery technology, and efficiency gains are moving us in the right direction, with China increasingly leading the charge in clean tech.
However, global efforts need to accelerate and intensify even further. By strengthening energy policies, expanding carbon pricing, and pushing for faster growth in renewables, the world will be able to make important steps towards a successful energy transition.
See you next week.
P.S.: Get the report here.