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The global energy transition is entering a new phase. Climate change is intensifying, geopolitical tensions are reshaping energy markets, and electricity demand is rising at unprecedented speed. Yet these forces, rather than slowing the shift away from fossil fuels, could ultimately accelerate it.

 

The climate outlook is becoming increasingly difficult to ignore. Global warming is now expected to temporarily exceed the 1.5°C threshold within the coming years, raising the prospect of more frequent heatwaves, droughts, floods and other extreme weather events. The emergence of a strong El Niño in 2026 is adding another layer of volatility to an already exceptionally warm climate. The immediate consequences are being felt through agriculture, water stress, infrastructure and food security. 

 

But the climate story is not only one of worsening risks. It is also a story of accelerating technological change. 

 

Renewables are now on the verge of overtaking coal as the world’s largest source of electricity generation. Solar and wind capacity continue to expand rapidly, while electrification is transforming transport, buildings and industry. At the same time, nuclear power is returning to the energy strategies of an increasing number of countries. The energy system of the next decade is therefore likely to be considerably more electrified and diversified than that of the past. 

 

This transformation is being driven by more than climate concerns. 

 

Recent geopolitical tensions have exposed the vulnerabilities associated with dependence on imported fossil fuels. Oil and gas remain essential to the global economy, but their prices and supply can be heavily affected by conflicts, sanctions, disruptions to shipping routes and strategic rivalries. For governments concerned with energy security, domestically produced solar and wind power offer something that imported hydrocarbons cannot: a source of energy that is increasingly abundant, scalable and less exposed to geopolitical disruption. 

 

This changes the logic of the energy transition. Clean energy is no longer simply a means of reducing greenhouse-gas emissions. It is increasingly becoming a means of strengthening national resilience. 

 

Electrification sits at the centre of this shift. As transport, industry and heating become increasingly electric, the importance of reliable electricity generation and grids will grow. The surge in electricity demand from data centres, artificial intelligence, electric vehicles and air conditioning is already forcing governments and companies to rethink the scale of future energy investment. 

 

Yet the transition will not be linear. The world is entering an era of rapidly rising electricity demand while remaining heavily dependent on fossil fuels. Countries will continue to rely on oil and gas for years, particularly where alternatives remain expensive or technically difficult. Geopolitical shocks can also encourage governments to prioritize immediate energy security over longer-term climate objectives. 

 

The result is not a simple race from fossil fuels to renewables. It is a much more complex restructuring of the global energy system. 

 

That restructuring is also creating new geopolitical dependencies. Critical minerals, batteries, semiconductors, electricity grids and clean-energy technologies are becoming strategic assets. Competition over who controls the supply chains of the energy transition could increasingly resemble the competition that once centred on oil and gas. Countries with abundant renewable resources, critical minerals, technological capabilities or access to major electricity markets could gain new strategic importance. 

 

For developing economies, the stakes are particularly high. The clean-energy transition could create opportunities for industrialization, investment and export diversification, but only if countries can secure affordable electricity, infrastructure, technology and financing. Africa, in particular, possesses enormous solar, wind and mineral resources, yet converting these advantages into productive capacity will require substantial investment and stronger regional integration. 

 

The central paradox of the current moment is therefore becoming clearer. Climate change is making the transition more urgent, while geopolitical tensions are making energy independence more valuable. At the same time, technological progress is making clean electricity increasingly competitive. 

 

The push for clean energy may consequently become broader than the climate agenda itself. It is becoming an economic, industrial and geopolitical imperative. 

 

The question is no longer simply whether the world will decarbonize. It is whether governments can turn the pressures of a hotter and more fragmented world into an opportunity to build a more secure, resilient and cleaner energy system. 

 

CLIMATE CHANGE AND GREEN ENERGY TRANSITION

The Geopolitics of Energy Transition: Opportunities for the Global South

 

Hung Q. Tran

 

Back in September 2024, scientists at the European Union’s Copernicus Climate Change Service  reported that summer 2024 was the hottest on record globally, and the previous twelve months posted a average global temperature that was a record 1.64 degrees Celsius (2.95 degrees Fahrenheit) above the average during the pre-industrial period, 1850-1900. This was triggered by a combination of a warmer El Niño cycle and the effects of human-caused warming. While it will take more years of such scorching global temperatures to confirm that the world has failed to keep the temperature increase below 1.5 degrees Celsius, the currently hot weather has given a clear warning that efforts need to be significantly accelerated to meet the key target of keeping global warming below 2 degrees Celsius (3.6 degrees Fahrenheit), agreed at the COP21 in Paris in 2015. Exceeding the 1.5 degrees Celsius limit increase now appears to be unavoidable... Read more

Charting a Green-Energy Transformation in Africa

 

Rim Berahab, Karim El Aynaoui

 

The demand for energy in Africa is growing rapidly, driven by population growth, urbanisation and industrialisation. Nevertheless, over 600 million Africans still lack access to electricity, which represents a significant energy gap for the continent. At the same time, Africa is endowed with vast renewable-energy potential, including abundant solar and wind resources, along with emerging technologies such as green hydrogen. It is crucial to unlock this potential to meet Africa’s energy needs and to foster sustainable economic development. Africa is well-placed to capitalise on the global drive for clean energy technologies and supply chain development, as renewable energy offers the dual benefits of expanding energy access and promoting green industrialisation across the continent... Read more 

The New Architects of Climate Action: Analyzing the Success and Limits of Private Finance

 

Sabrine Emran

 

The call for private finance mobilization received an answer in 2024, with private capital accounting for 66% of total flows inclimate finance, while still reaching a record level. This flow of private finance represents a structural shift that can both be considered as a significant achievement and an underexamined governance risk. This paper argues that the growth of private climate finance, while real and consequential, does not always directly serve climate objectives. Private capital is fundamentally risk-averse, return-driven, and structurally indifferent to the adaptation needs, geographic equity, and democratic accountability that a credible climate transition requires. As public governance architecture contracts, most sharply following the United States' 2025 withdrawal from the Paris Agreement, private actors have assumed increasing authority over four core governance functions: allocating capital, pricing risk, setting standards, and shaping narratives. That authority is exercised without democratic mandate, transparent methodology, or enforceable accountability... Read more

 

Climate and Policy Resilience in Brazilian Renewable Energy

 

Pedro Henrique de Christo, Travis Knoll, Otaviano Canuto

 

The Brazilian context involving a clean-electricity base, a more balanced lobbying landscape, and mounting climate and social pressure, makes it more difficult for the kind of abrupt and unrestrained energy policy swing seen in Colombia. The trend in Brazil tends to be more economically viable for renewables. However, these structural conditions by themselves will not guarantee the success of the transition. Fruition will depend on whether policymakers use this window to prepare for unavoidable climate disruption and the technological shifts of the coming decades, directing investment and infrastructure to real demand with disciplined allocation of scarce resources that can benefit communities and not just small segments of society... Read more

 

“Super El Niño”: The Urgency of Climate Adaptation and the Opportunity for Development

 

Pedro Henrique de Christo, Otaviano Canuto

 

As El Niño intensifies it generates apprehension among us all. The slow pace of the energy transition and continued carbon emissions have already put us on a trajectory toward an average air temperature rise of 2.8°C above pre-industrial levels(1850)—far exceeding the 1.5°C limit set by the 2015 Paris Agreement. The recent rate of increase has surpassed all projections made in the middle of the last decade. We have gone from 300 ppm (parts per million of CO2)—a level that remained stable for the 800,000 years prior to the Industrial Revolution—to 430 ppm in 2026. This level is similar to that of the Pliocene era, between 3 and 4.5 million years ago, when global temperatures were around 4°C higher than pre-industrial levels... Read more

 

(AR) El Niño in Morocco: Climate Impacts and Risks

 

This episode explores the El Niño phenomenon and its potential impacts on Morocco, explaining its mechanisms and effects on temperatures, precipitation, and extreme weather events. It also examines its potential implications for water resources and the agricultural sector, as well as the regions and sectors most vulnerable to its effects. The episode further discusses how El Niño is monitored and the extent to which its impacts on Morocco’s climate can be predicted... Watch

 

GREEN INDUSTRIAL POLICY, INVESTMENT & COMPETITIVENESS

Greening in the Wrong Places: Geography, Policy Distortions, and the Hidden Costs of Misallocated Green Investment

 

Jorge Arbache, Otaviano Canuto

 

Decarbonization is reconfiguring global relative prices. As clean energy, natural capital, and location-specific assets become dominant industrial inputs, the relative cost of producing low-carbon goods is increasingly determined by geography. Two systematic distortions explain why the expected reallocation of investment toward renewable-rich economies remains incomplete. First, industrial policy interventions, including subsidies, trade barriers, and certification systems, disconnect effective prices from underlying structural costs. Second, institutional failures create demand uncertainty that leaves structurally competitive projects unbankable. Together, these distortions generate static misallocation, leading to slower technological learning, higher fiscal burdens, delayed emissions reductions, and suppressed industrial opportunities in developing economies. This paper is part of broader research on powershoring and green comparative advantage, which focuses on the idea that decarbonization is a spatial and price reorganization of global production, in addition to a technological transition... Read more

The Automotive Transition on the Road to Decarbonization

 

Otaviano Canuto, Antonio Jorge Martins

 

The road to decarbonizing the planet runs through the energy transition, which includes the shift from fossil-fueled cars to renewable energy vehicles. This automotive transition is unfolding as a true revolution in the industry. The evolution toward electric and hybrid vehicles has come in tandem with the ascent of Chinese producers. In the current context of geopolitical and technological rivalries, the automotive transition has been marked by an intense trade war, with implications for the trajectory of decarbonization... Read more

 

Electrifying the Future: Assessing the Economic and Environmental Impacts of a Shift Toward EV Production in Morocco

 

Mahmoud Arbouch

 

This paper assesses the economic and environmental implications of Morocco’s strategic transition from internal combustion engine vehicle (ICEV) manufacturing to electric vehicle (EV) production, with a particular focus on the regional impacts of localizing high-value battery manufacturing. Using an interregional input-output model, extended with environmental satellite accounts, the study simulates a structural shock related to the wholesale substitution of ICEV-specific inputs with EV-specific components. The results highlight substantial macroeconomic gains, including a 1.9% increase in national GDP and positive employment growth, particularly in Tanger-Tétouan-Al Hoceima, Rabat-Salé-Kénitra, and Casablanca-Settat. However, these benefits are regionally concentrated, exposing the risk of deepening spatial inequalities... Read more

Building the Afri-LAC Agenda: Green Industrial Policy in a Changing World

 

Africa, Latin America and the Caribbean have both the potential and the ambition to transform their economies through green industrial policy. Yet structural constraints, weakened multilateral institutions and growing geopolitical fragmentation are narrowing their policy space. Rising protectionism, shifting subsidies, sanctions and the securitisation of trade have further increased uncertainty for the Global South. At the same time, this disruption creates an opportunity to rethink existing international arrangements and build more inclusive forms of cooperation. Strengthening Africa–LAC ties can provide a platform for greater South–South coordination and collective agency. Together, the two regions can influence global narratives, policies and economic systems. The question is no longer whether green industrial transformation is possible, but how Africa and LAC can shape it together... Watch

 

Financing the Green Future: How Emerging Economies Can Lead the Climate Transition

 

Emerging economies face a critical challenge: how to sustain growth while responding to climate change. In this episode, we explore the role of green finance, from climate bonds and sustainable infrastructure to blended finance, in supporting decarbonization, job creation, and climate-resilient development. Joining us is Mehran Haghirian, Director of Research & Programmes at the Bourse & Bazaar Foundation and an Atlantic Dialogues Emerging Leader, for a timely discussion on how emerging economies can mobilize capital, align policies, and position themselves as leaders in the global climate agenda... Watch

RSK Connect: Territorial Dynamics and Investment Opportunities in Sustainable Mobility

 

In a context marked by the acceleration of climate, energy, and technological transitions, sustainable mobility is increasingly emerging as a strategic pillar of public policy and industrial development. It represents a key lever for reconciling economic competitiveness, environmental sustainability, and the improvement of citizens’ quality of life.

The Rabat–Salé–Kénitra region stands as a strategic hub within Morocco’s national industrial ecosystem, at the intersection of the Kingdom’s industrial, logistical, and institutional dynamics. With its structuring infrastructure and diversified productive base, the region offers significant potential in terms of attracting productive investment and integrating into global industrial value chains... Watch

 
 

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