Global energy transition stalls despite record investment as geopolitical risks deepen: WEF

Global efforts to build cleaner, more secure and equitable energy systems are losing momentum despite record levels of investment, according to the World Economic Forum’s (WEF) Energy Transition Index (ETI) 2026 released on Thursday.

Developed in collaboration with Accenture, the report warns that geopolitical tensions, supply disruptions, and rising energy demand are contributing to growing fragmentation across the global energy landscape, slowing the pace of transition.

The report found that the global energy transition — measured by progress toward sustainable, affordable, and secure energy systems — has effectively stalled even after global energy investment reached an all-time high of $3.3 trillion, including $2.3 trillion directed toward clean energy.

According to the findings, transition readiness declined for the first time in more than a decade, highlighting a widening disconnect between capital deployment and countries’ ability to convert investment into lasting energy transformation.

Recent disruption in the Strait of Hormuz has further intensified concerns outlined in the Index, exposing the vulnerability of global energy systems to geopolitical shocks. Import-dependent emerging economies remain particularly vulnerable as supply constraints and structural weaknesses raise pressure on affordability, resilience and long-term sustainability.

“The energy transition is not reversing, but it is fracturing,” said Roberto Bocca, Head of the Centre for Energy and Materials at the World Economic Forum.

"In a more volatile geoeconomic environment, security, affordability and resilience are central to sustaining progress. Closing the gap between ambition and delivery will require stronger foundations, including more diversified and resilient energy systems, faster infrastructure build-out, and capital that can reach markets where it is needed most,” Bocca said.

The Energy Transition Index evaluates national energy systems across three dimensions — energy security, sustainability, and equity — alongside the enabling conditions needed to support long-term transition, including policy frameworks, infrastructure, investment and innovation.

Overall ETI scores remained broadly unchanged year-on-year, reflecting slowing global momentum. Improvements in some areas were offset by deterioration in energy security and transition readiness amid tighter financing conditions and infrastructure bottlenecks.

Although nearly 60% of countries recorded improvements in overall scores, balanced progress remains limited. Only one in four countries advanced simultaneously across all three pillars of the index.

Accenture’s Global Lead for Industry and Enterprise, Muqsit Ashraf, said the transition is entering a more complex phase that requires greater business resilience. “The energy transition is entering a more disruptive and challenging phase, making enterprise resilience an increasingly important priority for business leaders,” Ashraf said.

He added that organisations deploying technology and artificial intelligence to improve adaptability and decision-making will be better positioned to manage uncertainty and support long-term growth.

Among individual markets, Nordic countries continued to dominate the rankings while Singapore emerged as one of the fastest climbers, rising 10 places due to stronger regulation and enhanced political commitment.

Advanced economies occupied 14 of the top 20 positions, though progress remained uneven and modest, with average scores increasing by only 0.2% over the year.

Among G20 nations, Germany ranked ninth, followed by France (10th), the United Kingdom (11th), China (14th), Brazil (17th), and the United States (19th).

China maintained record levels of clean energy investment, while India posted one of the strongest improvements in transition readiness. The United States continued to score strongly on energy security despite a slight decline overall.

At the regional level, Sub-Saharan Africa delivered the strongest gains, whereas Latin America weakened amid falling transition readiness. Brazil maintained leadership within the region due to its diversified energy mix.

The Middle East and North Africa region also recorded setbacks as weakening policy momentum and lower infrastructure investment slowed progress. Saudi Arabia, however, stood out with gains supported by strong financial commitments and renewable energy deployment.

The report noted that global electricity demand increased 3%, driven by electrification, cooling requirements, digital infrastructure expansion and the rapid growth of artificial intelligence.

Emerging economies now account for nearly 80% of global demand growth but continue to face higher financing costs and infrastructure limitations.

At the same time, clean-energy investment remains concentrated, with nearly 75% of capital flowing into a small group of economies, widening the mismatch between where investment is directed and where future demand is expected to emerge.

To sustain momentum, the report outlined three priorities: embedding security and resilience into energy system design from the outset, accelerating grid expansion and system integration, and improving investment conditions through stable policy frameworks and targeted capital flows toward emerging markets.

According to the WEF, countries that advance on all three fronts will be better positioned to convert current pressures into long-term competitive advantage in an increasingly fragmented global energy environment.