The World Economic Forum’s (WEF) 2024 report, ‘Accelerating Effective Energy Transition’, reveals significant progress by countries according to the Energy Transition Index (ETI). However, economic volatility, heightened geopolitical tensions, and technological changes have slowed this transition.
Leading the ETI are Sweden, Denmark, Finland, and Switzerland, all developed economies. France also features in the top 5 due to its efficient energy policies. These countries have enhanced their energy security through diverse energy mixes, increased clean energy shares, carbon pricing mechanisms, and supportive legal frameworks.
Emerging economies like China and Brazil have also made notable strides. China commissioned significant solar photovoltaic (PV) capacity in 2023, while Brazil plans to develop hydropower and biofuels to attract investors.
Countries Leading the Energy Transition. Source: WEF
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Estonia, Ethiopia, and Lebanon have seen the fastest improvements over the past five years by prioritizing off-grid renewable energy to enhance access and sustainability.
Developing countries leading the energy transition include Lebanon, Ethiopia, Tanzania, Zimbabwe, and South Africa. These nations are committed to reducing fossil fuel subsidies, decentralizing renewable energy, and increasing clean energy jobs.
Vietnam ranks 32nd on this list.
The report indicates a slowdown in the energy transition momentum. Despite increased adoption of wind and solar energy, investments in clean energy are not yet at the pace required to reach net-zero emissions by 2050, particularly in energy efficiency, electrification of energy systems, and the adoption of low-carbon energy sources and fuels.
This slowdown is attributed to inflation and high-interest rates, resulting in tighter and more expensive energy markets. Developing countries face challenges in investing in sustainable energy solutions.
Additionally, geopolitical tensions have impacted the transition pace for some countries. For instance, Germany increased coal production by 35% in 2022 to reduce reliance on Russian gas.
The report also highlights significant gaps in transition momentum, with nearly 85% of investments in clean energy infrastructure occurring in advanced economies.
AI is also aiding governments and energy companies, with Accenture research suggesting AI initiatives could save $500 billion annually.
Duy Anh
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