Source:

The World Economic Forum (WEF) has released the Global Energy Transition Index (ETI) 2025, evaluating the performance of energy systems and transition readiness across 118 countries.

Objective of the Report:

• To rank countries based on the three core pillars of:
• Energy Security: Reliability of energy supply and dependence on imported fossil fuels
• Sustainability: Adoption of renewable energy and reduction in carbon emissions
• Equity: Access to affordable and inclusive energy for all

Key Readiness Factors:

• Political Commitment
• Investment and Financing
• Innovation and Technology
• Infrastructure Development
• Human Capital and Skill Development

Highlights and Global Rankings:

• India’s Rank:

India ranks 71st in 2025, down 8 positions from 63rd in 2024.

• Top 5 Countries:

1. 1. Sweden
   2. Finland
   3. Denmark
   4. Norway
   5. Switzerland

• Other Notable Countries:
• • China – 12th
  • United States – 17th
  • Pakistan – 101st
  • Congo – Lowest Rank
• India’s Improvements:

India showed significant improvement in energy efficiency, investment capacity, methane emissions reduction, and energy access.

Global Context and Key Challenges:

• Clean Energy Investment:

In 2024, global investment in clean energy exceeded $2 trillion.

• Carbon Emissions:

Despite this, global carbon emissions reached a record high of 37.8 billion tonnes.

• Energy Demand:

Global energy demand increased by 2.2% in 2024, driven by:

• • Artificial Intelligence (AI)
  • Data centers
  • Rising cooling needs
• Geopolitical Tensions:

Slowed down the pace of energy transition.

• Uniform Progress Lacking:

Only 28% of countries showed simultaneous progress in all three dimensions: security, sustainability, and equity.

Surge in Global Energy Demand:

• Energy demand rose by 2.2% in 2024, the fastest growth in several years.
• Primary Reasons:

• • Extreme heat and cooling requirements
  • Energy-intensive AI-powered data centers
  • Accelerated electrification

It is estimated that by 2030, 10% of global electricity demand growth will come from AI data centers alone.

Clean Energy Investment and Emissions:

• Investment in clean energy exceeded $2 trillion in 2024 – double the 2020 figure.
• However, CO₂ emissions still reached an all-time high of 37.8 billion tonnes.
• To meet net-zero targets, the world needs $5.6 trillion in annual investment by 2030 – significantly higher than current levels.
• Clean energy investment growth slowed to 11%, much lower than the 24–29% annual growth seen in previous years.

Uneven Energy Transition Progress:

• ETI 2025 recorded only a 1.1% increase in the global average score.
• Just 28% of countries improved across security, sustainability, and equity together.
• Many countries face geopolitical tensions, capital constraints, and supply chain disruptions.

Geopolitical and Economic Pressures:

• Conflicts in Europe, West Asia, and Africa disrupted energy supply and security.
• Monetary tightening and inflation raised the cost of capital, particularly in emerging markets.
• These markets accounted for over 80% of demand growth,
• Yet, over 90% of clean energy investment flowed into developed economies and China.

Challenges in Energy Security and Infrastructure:

• Energy security remained fragile, hindered by:

• • High import dependence
  • Inflexible grids
  • Limited diversification
• Digital infrastructure and the increasing share of intermittent renewable energy sources are stressing power grids.
• Countries are prioritizing domestic control over critical energy materials like lithium, cobalt, and rare earth elements, leading to fragmentation and rising competition.

World Economic Forum (WEF):

• Founded: 1971
• Founder: Klaus Schwab
• Headquarters: Colonnais, Geneva, Switzerland
• Nature: International non-profit organization
• Objective: Promote public-private cooperation on global, regional and industrial issues
• Famous events: Annual meeting - Davos, Switzerland

Major publications:

• Global Competitiveness Report
• Global Gender Gap Report
• Global Risks Report
• Energy Transition Index