The energy transition has a new engine — and it’s not policy

The energy transition is increasingly driven by technology economics and energy-security imperatives rather than climate policy, creating a selective opportunity for investors.

• The combined levelized cost of solar PV and batteries fell by half in five years, while global battery capacity increased twentyfold since 2020.
• Wind, heat pumps and electric vehicles have reached sticker-price parity in most major markets, whereas green hydrogen, carbon capture and storage, and e-fuels remain expensive and slow to deploy.
• Three quarters of the world’s population live in countries that are net fossil-fuel importers, and Ember estimates that renewables, EVs and residential heat pumps could offset up to 75% of global GDP spending on fossil-fuel imports.
• In 2025, clean-energy supply grew more than twice as fast as electricity demand, while electricity demand grew more than twice as fast as total energy demand; clean power could reach two thirds of global electricity generation in the 2030s.
• Electricity offers the clearest near-term opportunities, transport and heating provide medium-term potential, and industrial decarbonisation in cement, steel and chemicals requires closer scrutiny of technological feasibility and financial materiality.

Takeaway: Investors should focus on technologies that have crossed the threshold of economic competitiveness and on companies with credible, financially material transition strategies, while avoiding policy-dependent themes and unproven technologies.