The energy transition requires a full transformation of the global energy, economic and social system, beginning now, as the next decade is crucial to delivering on climate goals, according to a World Economic Forum (WEF) report on Wednesday.
The WEF's Fostering Effective Energy Transition 2021 report showed that electrification across other sectors of energy end-use, notably industries, HVAC (heating, ventilation and air conditioning) and transport are needed to achieve climate goals.
Given that as of 2018, 81% of the world's energy was still supplied by fossil fuels, the transformation of energy systems needs to increase its momentum to help achieve critical objectives such as the UN's Sustainable Development Goals and those of the Paris Climate Agreement.
The WEF said that decarbonizing the energy sector is critical over the next decade. However, some inroads have been made last year towards this goal with record flows of finance totaling $501 billion poured into energy transition. This represents a 9.4% increase from $458 billion in 2019 with mature renewable energy technologies accounting for most of this investment
Other energy transition areas such as mobility, electrified heat, storage, and carbon capture and storage (CCS) account for a small proportion of the total investment.
The WEF's report defined the energy transition as "a timely transition towards a more inclusive, sustainable, affordable and secure energy system that provides solutions to global energy-related challenges, while creating value for business and society, without compromising the balance of the energy triangle."
By Gulsen Cagatay