Energy Transition

4 areas of focus in energy at Davos 2025

At Davos 2025 there was much optimism and talk of the opportunities ahead for the energy transition.

Image: World Economic Forum/Pascal Bitz

This article is part of: World Economic Forum Annual Meeting
  • Energy was a key topic at the World Economic Forum Annual Meeting 2025, with discussions featuring a greater focus than in previous years on energy security, meeting rising demand and how energy enables economic development.
  • Artificial intelligence and US energy policy were major topics of discussion, focusing on the impact of technological advancements and regulatory decisions on global markets and the energy transition.
  • And while geopolitical shifts and trade fragmentation loomed large, conversations were more nuanced than in previous years, with a strong recognition of the need for collaboration to address future energy challenges.

This year’s Annual Meeting was an eventful one when it comes to energy. Many of the biggest topics being discussed – geopolitics, artificial intelligence (AI), the new US administration – will have a significant impact on the sector.

As such, where sustainability was once the dominant focus for the energy transition, increasing attention is being given to energy security and how to meet rising demand and support economic growth.

Here are some of the key takeaways from the week

The energy transition is in motion – and while it’s still too slow, it won’t stop

Donald Trump said in his virtual address to the Annual Meeting that the US needs to double its current energy capacity to compete in AI and that coal could be used as a back-up power source.

And the six energy-relevant executive orders he signed on his first day in office – including lifting restrictions on oil and gas production and the withdrawal from the Paris Climate Agreement – will certainly stoke fears of a slowdown in the energy transition.

Yet many analysts say this won’t happen and that clean technologies will continue to grow. I felt the same sentiment at Davos, with leaders confident the shift to decarbonization will continue enabling energy security and affordability. As Jesper Brodin, CEO of Ingka Group (IKEA), told delegates: “The roadmap to transformation has started. It’s massive. It’s unstoppable.”

With costs of solar and wind power, even batteries in electric vehicles, falling, there is a business and economic case for the energy transition to happen.

Choices will be made on this basis and – as outlined in a World Economic Forum briefing paper on this topic – we must work to strengthen this case so that more existing systems can be decarbonized and new energy sources scaled up.

Building momentum for the energy transition and unlocking necessary investments requires a strong alignment of the economic and business cases. Image: World Economic Forum

There is a growing understanding that the energy transition is complex

When we talk about a true energy transition, we are not just talking about adding more and more solar or wind power to grids.

We are talking about system-wide changes across industries and societies to achieve equitable, secure and sustainable energy systems. This involves many complexities and at the Annual Meeting 2025 there appeared to be much more understanding of this.

For example, past discussions about minerals have often been isolated from the wider context of the energy transition. But for a new energy system, we will need a lot of new minerals. The supply chain is linked to the energy transition.

It was clear at Davos that more people now understand the importance of addressing minerals in this context.

There is willingness to collaborate

Despite geopolitical shifts and fragmentation in trade and elsewhere, all around Davos we saw the results of willingness to collaborate.

Businesses are working to find ways to operate and keep momentum in areas including economic growth and the energy transition.

And across many sessions, there were calls for greater public-private collaboration on innovation, funding, policy and more to help advance the energy transition.

Acknowledging that no company or country alone can undertake this challenge, the European Commission launched its Global Energy Transition Forum at Davos. Conceived to “connect the dots” between governments, companies and investors to drive momentum on targets of tripling renewable energy and doubling energy efficiency by 2030, the initiative will unite public and private sector partners worldwide.

Benefits are an important part of AI deployment

Artificial intelligence (AI) was a major discussion point that cut across myriad sessions at this year’s Annual Meeting.

And a lot of talk has been around the increasing power demand of the large data centres that support generative AI models. There were nuanced discussions at Davos around how different regions will be impacted differently by this growth, as well as how AI’s increasing thirst for energy is still predicted to be a fraction of overall demand.

There was also excitement about the “amazing opportunity” for AI to accelerate the energy transition and related innovation.

As described in the recent Forum report Artificial Intelligence’s Energy Paradox: Balancing Challenges and Opportunities, AI has immense potential to support energy transition efforts, from optimizing grids and energy systems to forecasting for renewables such as wind and solar power.

Key areas to monitor concerning AI’s energy impact, 2024-2025 outlook.
Key areas to monitor concerning AI’s energy impact, 2024-2025 outlook. Image: AIGA, AI Energy Impact Initiative, World Economic Forum

The ongoing energy transition will continue to throw up challenges, but there are also big opportunities to move forward – and this optimism was palpable at Davos. With a focus on innovation and collaboration, we can continue to make progress on a secure, equitable and sustainable transition.

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