The 2025 World Economic Forum Energy Transition Index shows continued progress in the global shift to cleaner energy, with nearly half of countries improving their performance over the past decade, but the pace and resilience of the transition remain uneven.
The Fostering Effective Energy Transition 2025 report, developed in collaboration with Accenture, benchmarks the performance of energy systems of 118 countries across three performance dimensions – security, sustainability and equity – and five readiness factors: political commitment, finance and investment, innovation, infrastructure, and education and human capital.
The 2025 Energy Transition Index recorded a 1.1% year-on-year gain – the fastest since pre-COVID levels. Some 65% of countries improved their Energy Transition Index scores, with 28% advancing across all three core dimensions but the news is not all good:
- Since 2021, over 80% of energy demand growth has come from emerging and developing economies, but more than 90% of clean energy investment has been seen in advanced economies and China, revealing a misalignment between capital flows and future demand.
- Despite $2 trillion in clean energy investment in 2024, energy security stalled and emissions hit a record 37.8 billion tons in the hottest year on record, as energy demand rose 2.2% drivenby AI, data centers, cooling and electrification.
- Rising geopolitical fragmentation, inflation, and digal infrastructure stress from AI-driven data centers could derail future progress if not addressed, the report says.
Energy Transition Index 2025 scores
Sweden, Finland and Denmark topped the Energy Transition Index, reflecting their long-standing policy commitment, robust infrastructure and diversified low-carbon energy systems, says the report. Norway and Switzerland rounded out the top five, underscoring renewed momentum in their energy transition. Austria, Latvia and the Netherlands followed closely, with strong performances in equity, clean energy capital flows and renewable energy capacity buildout. Germany and Portugal completed the top 10.
Among the top 20, China reached a record 12th place, fueled by its scale and leadership in innovation and clean energy investment. Brazil ranked 15th, leading Latin America with greater energy diversification, lower prices and rising clean energy use. The United Kingdom placed 16th, while the U.S. rose to 17th overall and ranked 1st in energy security, supported by a diversified energy system and strong innovation.
India advanced on energy efficiency and investment capacity, while the United Arab Emirates recorded the strongest year-on-year gain in a decade, driven by rapid infrastructure upgrades, targeted subsidy reforms, rising clean energy use and lower energy intensity.
Keeping The Energy Transition On Track
The report highlights three system-level priorities to keep the energy transition on track globally. These include redefining energy security beyond traditional supply concerns to include grid resilience and digital infrastructure; correcting capital imbalances, particularly in emerging economies; and addressing infrastructure bottlenecks, such as permitting delays, workforce gaps and grid capacity, which now constrain progress more than technology availability.
“Looking ahead, transformation will require more than innovation,” says the report. “Energy systems must be resilient, flexible and able to scale clean technologies, improve efficiency, secure critical inputs and reduce emissions from legacy infrastructure. Setting targets is no longer enough – capacity for delivery must be actively built amid global uncertainty.”
Technologies like AI, advanced storage and decentralized infrastructure are accelerating change but also increasing pressure on power systems, supply chains and regulation, notes the report. As AI, quantum computing and industrial digitalization evolve, countries must harness their potential without overwhelming already-strained systems.”
Five Recommended Actions
To sustain momentum and build resilience, the report calls for five actions. The first is to adopt stable, adaptive policy frameworks that drive long-term investment and support cooperation and design globally aligned policy frameworks that adapt to local contexts and are reinforced by strategic partnerships, tailoring incentives to national strengths and enabling regional cooperation on infrastructure, supply chains and energy integration. The report cites India’s National Green Hydrogen Mission as an example to follow. It provides targeted incentives based on each state’s industrial strengths, such as Gujarat’s petrochemical capacity, Tamil Nadu’s renewables base and Odisha’s steel production, supporting domestic manufacturing and export potential while aligning with national and global decarbonization goals.
Secondly, the report recommends modernizing grid infrastructure and planning using digital tools to better integrate renewables, storage and distributed assets, ensuring clean energy can be delivered reliably and efficiently across power and fuels. It also recommends actions to minimize energy losses and improve overall system efficiency. An example the report cities is Saudi Arabia’s Saudi Electricity Company. It installed 11 million smart meters, improving real-time energy monitoring, enhancing grid reliability and laying the foundation for increased renewable integration.
The report’s third recommendation is to align education, vocational training and workforce planning with real-time labor market needs to cultivate a skilled, inclusive workforce that can support clean energy deployment, energy efficiency upgrades and a just transition. Yhr example cited is Australia’s Clean Energy Training Hubs which partners with technical and ither education institutions, energy companies and unions to deliver practical training in solar, wind and battery installations –bridging the gap between market demand and workforce supply.
Accelerating clean technology commercialization, especially in hard-to-abate sectors, is also necessary.. The report says this can be done by cultivating international collaboration in R&D and innovation, and linking R&D, pilot support and early offtake to reduce testing time, hasten identification of unviable technologies and accelerate the scaling of breakthrough solutions in heavy industry, transport and hydrogen(including technologies that optimize energy use across industrial processes). The example cited is the U.S. Department of Energy’s $7 billion investment in regional hydrogen hubs that help public-private partnerships to scale early-stage hydrogen technologies, supporting industrial decarbonization across transport and manufacturing.
The fifth action item is to enhance capital investment in developing economies by combining risk-sharing tools, local capital market development and targeted public-private platforms, making clean energy and energy efficiency investment more viable where it’s needed most. India’s National Investment and Infrastructure Fund (NIIF) is an example. It serves as a sovereign-backed platform that partners with global investors to co-finance infrastructure, using credit enhancements to de-risk clean energy projects and attract private capital at scale.
“Together, these five actions can help deliver a more resilient, inclusive and investable energy transition –globally and locally,” says the report.
To read more of The Innovator’s Energy Transition article click here.
