External factors and trends
Investments in cost-effective clean energy continue to rise and it has become obvious that the energy transition is unstoppable – driven by demand for clean electricity, energy independence, advancements in new technology, and an improving investor environment.
The Great Shift
The energy transition is picking up speed. In 2024, the EU’s electricity production from wind and solar power overtook coal and gas for the first time, accounting for 30 percent of total electricity generation. More than half of the member states now generate more electricity from solar and wind than from fossil fuels. Last year about 2 trillion dollars were invested globally in clean energy and its infrastructure, that is two-thirds of all energy investments in the world. The share will only grow as more sectors become electrified.
Growth and prosperity
At the end of the day, investing in clean energy is about more than just building power generation capacity. Every country is depending on a cost-effective and stable power supply to create jobs, economic growth and higher living standards.
As electrification progresses, nations must rapidly scale up low-cost electricity supplies to support energy-intensive industries, charge heavy transport, produce e-fuels, and attract new business. The race to secure growth and prosperity is intensifying, alongside the need to combat climate change.
"The transition to clean energy is happening worldwide and it’s unstoppable. It’s not a question of ‘if’, it’s just a matter of ‘how soon’ – and the sooner the better for all of us."
Fatih Birol, Executive Director of the International Energy Agency (IEA)
New technology creates opportunities
Efficiency is improving, and costs are falling. The technological advancements in renewable energy and energy storage are remarkable — and accelerating. In 2024, a 25 MW offshore wind turbine was introduced; just a few years ago, even 20 MW seemed distant. Energy storage is next in line to see exponential development. Two years ago, the price of lithium-ion battery packs was estimated to go down to 150 dollars per kWh by 2030. In 2024, they were priced at 115 dollars per kWh.
These advances create business opportunities as well as cost-saving prospects for energy intensive industries. More venture capital, research funding, and corporate investments are being directed toward harnessing these developments.
Investor outlook clearing up
The renewable energy sector has faced challenges, including high inflation, rising interest rates, and volatile electricity prices. Turbine manufacturers also struggled with technological issues, which limited supply and dampened market growth.
However, in 2024, investor confidence has rebounded as inflation and interest rates have declined. A more diverse group of investors, not only strategic and industrial buyers, is showing renewed interest.
It is now evident that the energy transition is not only necessary but also profitable and unstoppable.