Fostering Effective Energy Transition 2025

After several years of slow momentum, energy transition progress has accelerated, according to the World Economic Forum's Fostering Effective Energy Transition 2025 report. The Energy Transition Index (ETI), which benchmarks 118 countries on their current energy system performance and on the readiness of their enabling environment, finds improvements in energy equity and sustainability driven by easing energy prices, subsidy reforms, lower energy and emission intensity and increased share of clean energy. However, energy security has made more limited progress, and transition readiness momentum has slowed. Meanwhile, global energy systems are facing increasing pressure from climate change, geopolitical, economic and technological disruptions.

The Energy Transition Index (ETI) provides a data-driven framework to assess how 118 countries are positioned to navigate the evolving energy landscape. It measures both system performance (security, equity and sustainability outcomes) and transition readiness (enablers of progress, including regulations and political commitment, finance and investment, education and human capital, infrastructure, and innovation), resulting in an ETI score.

Overall, 65% of countries improved their ETI scores in 2025. System performance scores increased 1.2% due to equity and sustainability progress. Equity saw a strong rebound (+2.2% y-o-y), nearing pre-COVID-19 pandemic levels, supported by moderating energy prices and structural subsidy reforms. Average sustainability scores also improved (+1.2% y-o-y), highlighting lower energy and emissions intensities and clean energy’s increased share of energy consumption. However, energy security saw little improvement (+0.4% y-o-y), indicating persistent vulnerabilities in energy supply flexibility and diversity for many countries. Overall, only 28% of countries made simultaneous progress across security, equity and sustainability in 2025, reflecting uneven progress.

Transition readiness, which considers regulation, infrastructure, education, innovation and investment capacities, slowed to just 0.8% y-o-y, well below its 10-year trend. While past gains in regulation, infrastructure, innovation, education and investment have underpinned long-term progress, recent momentum has weakened. Regulatory frameworks, innovation ecosystems and investment capacity showed signs of stagnation, and, in some regions, a diminished rule of law further undermined policy effectiveness. This is relevant as improvements in readiness typically precede gains in performance. If readiness continues to lag, future progress in energy security, equity and sustainability could be at risk.

Regional dynamics and the multi-speed nature of the transition

Advanced economies continued to lead the rankings, accounting for 16 of the top 20 performers. The Nordics – Sweden, Finland, Denmark and Norway – retained the top positions, reflecting high performance across energy diversification, clean energy adoption, strong policy frameworks and reliable infrastructure.

Emerging Europe and Asia led regional improvements in transition readiness, but through distinct pathways. Emerging Europe advanced most in infrastructure and education and human capital, while emerging Asia saw gains from clean technology investment and innovation. Meanwhile, regions like Sub-Saharan Africa improved through stronger political commitment and financial flows, reinforcing the multi-speed nature of transition readiness.

Among some of the largest economies, China’s rank reached an all-time high of 12th place, driven by strong innovation capacity and the world’s largest clean energy investment volumes. The US ranked 17th, largely due to its strong security and improved sustainability. India advanced in energy efficiency and investment capacity.

Among some of the most improved performers, Nigeria made notable progress, rising from 109th place in 2016 to 61st in 2025, driven by improvements in financial investments and infrastructure. Latvia entered the ETI top 10 for the first time, driven by gains in equity, clean energy capital flows and renewable energy capacity buildout. Meanwhile, the United Arab Emirates recorded the highest improvement in the Middle East, thanks, in part, to targeted subsidy reforms, rising clean energy shares and falling energy intensity.

Global energy systems are under growing pressure from climate, geopolitical and technological disruptions. Geopolitical and economic uncertainties, such as rising trade tariffs, have highlighted vulnerabilities in supply chains. These factors could create investment risks and shift government focus towards more immediate priorities, slowing progress moving forward. Adaptive, locally tailored solutions will be crucial for scaling clean energy while ensuring resilience and affordability. Accelerating innovation will be essential, including by fully harnessing the performance opportunities enabled through AI, energy efficiency, clean fuels, storage, smart grids and other methods.

The report lays out five priorities for accelerating the transition:

1. Adopt stable, adaptive policy frameworks to attract long-term capital and cultivate cooperation.

2. Modernize energy infrastructure – especially grids, storage and interconnectors.

3. Invest in skilled talent to help boost innovation and execution capacity.

4. Accelerate clean technology commercialization, especially in hard-to-abate sectors.

5. Enhance capital investment in developing economies.