Nextcontinent study: Global energy transition continues on a steady course
The global transition to renewable energy is continuing on a steady course, despite fossil fuels still dominating around the world. Modern renewables make up a bit more than 12% of total energy supply, backed by a sustained increase in global investments.
The transition toward a more diversified and decarbonized energy system is underway. Its pace and form, however, will hinge on coordinated global action and more investment, according to a report from global consulting network Nextcontinent.
Overall, the global energy landscape has been going through a transformation as governments and energy companies grapple with shifting geopolitical risks, tough market conditions, and an acceleration of the energy transition. After a volatile start to 2025, the energy sector is now bracing for a period of sustained change.
Regional dynamics
Asia leads global energy growth, particularly in electricity demand, with China at the forefront of both traditional and renewable energy production. China installed nearly 350 GW of new renewable capacity in 2023, surpassing half of the global total. On the other hands, Japan saw their output fall to its lowest in about a decade. Many Asian countries still rely heavily on fossil fuels.
North America has been seeing electricity demand rise significantly in recent years, in part from electrification and data centers, as renewable capacity is expected to triple by 2035. The U.S. remains a top producer of oil and natural gas, though coal-fired energy has been on the decline.
Renewables in the US face an uncertain future as federal clean energy incentives were significantly rolled back in 2025 by the Trump administration. Investment and job creation in the sector as since slowed down.
The European Union, for its part, is the region most aggressively reducing emissions, with renewables set to provide 80% of its electricity by 2030. Fossil fuel demand is dropping sharply, and dependence on Russian gas has plummeted, amid war and sanctions. Germany, Denmark, Austria, and Belgium are global leaders in both onshore and offshore wind energy, while Spain, Poland, the Netherlands, Italy, and (again) Germany all generate increasingly large amounts of solar energy.
When it comes to Middle Eastern countries, most remain heavily reliant on oil and gas exports. Despite that, renewable electricity, primarily solar, is growing. Moving away from fossil fuels is a major part of the agenda for the next few decades in many Middle Eastern countries, with ambitious net-zero goals signaling a major uptick in renewables in the near term.
Latin America and the Caribbean are expanding renewable investments, particularly in hydropower, solar, and wind. Africa, for its part, is poised for major energy growth, with clean energy projected to rise by 42% by 2030 and renewables making up 80% of new capacity.
An evolving landscape
Energy demand around the world grew by 2.2% in 2024, with a 4.3% increase in demand for electricity, partially driven by record temperatures, increasing electrification, and growing digitalization. Fossil fuels remain a crucial part of the energy breakdown, but their dominance is increasingly challenged by renewables, which accounted for 38% of new energy supply in 2024.
Renewables are going to continue making up larger and larger amounts of global energy production. By 2030, combined global renewable energy capacity is projected to increase by 2.5 to 3 times the current levels. These predictions depend largely on different scenarios and what ultimately ends up playing out in terms of policies and regulations.
The role of nuclear
Nuclear energy, though it continues to be a controversial alternative to fossil fuels, is on the rise. Unlike intermittent renewables like solar and wind, nuclear power plants can provide a consistent, low-carbon power source. In 2024, nuclear made up 9% of global power, a 33% increase from the previous year.
There is, of course, considerable public opposition to nuclear energy. This view is understandable considering the severity of past nuclear incidents like the meltdowns at Chernobyl and Fukushima, which left a lasting impact on the public perception of nuclear energy. Proponents, on the other hand, point to its super low carbon emissions and minimal land footprint compared to other energy sources.
Further reading: The evolution of nuclear energy technology and its investment challenges.
A transformation for decades
“The energy landscape in 2025 presents a paradox of opportunity and uncertainty,” concludes the Nextcontinent report.
“As clean energy investment accelerates and digital innovation reshapes the industry, vulnerabilities – ranging from supply chain dependencies to global instability – remain acute. The question is no longer whether the energy sector will transform, but at what speed and scale this transformation will unfold.”
