Energy Transition: Yes, No, Maybe?

THB figures and tables from the 2026 EI Statistical Review of World Energy

The 2026 Energy Institute Statistical Review of World Energy — successor to the old BP Statistical Review, and an authoritative accounting of global energy data — has just been released with data through 2025. As I have done here at THB for years, in today’s post I update THB analyses of where the “energy transition” actually stands.

Regular readers will recognize the approach, which is based on my 2010 book The Climate Fix. At the bottom of this post you can find a methods appendix with details on the calculations, and below that paid THB subscribers will find an Excel spreadsheet with the sources and data from each graph and table. As always, this is work in progress — Caveat lector!

There is lots to discuss, so let’s get to it . . .

Carbon-free energy is growing — slowly

Let’s start with the good news for those promoting a transition away from fossil fuels. The carbon-free share of global energy consumption — nuclear, hydro, and other carbon-free generation technologies — reached its highest level ever.

That share now sits near 14% and has climbed steadily over the past decade, but slowly with respect to aggressive targets of climate policies: net-zero means going from 14% to 100%. At the pace of the past ten years, that would take centuries.

A quick aside: THB readers who have followed this analysis over years may recall that the carbon-free share of global energy was closer to 18% in prior years, rather than the 14% shown here. The difference comes entirely from an accounting change by the Energy Institute, not from any change in the real world: In its 2025 edition, in line with the IEA, EIA, bp, and Eurostat, the EI switched from the “fossil-fuel equivalent” (substitution) method to the “Physical Energy Content” method. The old method took each unit of nuclear, hydro, wind, or solar electricity and scaled it up to the amount of fossil fuel a power plant would have burned to generate the same electricity — just about tripling clean energy’s apparent contribution to account for the heat a thermal plant wastes. The new method counts that same carbon-free electricity based on its actual physical energy content. That change cut the reported renewable total by about a third and pushed the carbon-free share down from about 18% to about 14%. Does this mean the world is further behind on decarbonization than we thought? No. The task is enormous no matter how measured.

Total energy demand continues to increase, and fossil fuels have continued to meet the majority of that growth — with global fossil fuel consumption still growing as shown below.

Global fossil fuel consumption reached a new high in 2025 — about 518 exajoules. Net-zero is further away than ever. It is essential to understand that retiring fossil fuels reduces carbon dioxide emissions; simply deploying carbon-free energy does not.

The math of a 2050 net-zero target

What would reverse that fossil fuel line and move it towards zero?

Consider the arithmetic of a net-zero-by-2050 target, measured from 2025

Reaching zero by 2050 requires retiring ~21 exajoules of fossil energy every year, starting now. That annual reduction exceeds the total energy consumption of most countries on Earth. And every year the line fails to bend down, the required rate in the remaining years grows larger, just as a matter of math.

Replacing 21 EJ of fossil energy per year, and retiring an equal amount of fossil supply alongside it, means building the equivalent of about one 1.75-gigawatt nuclear plant every day from now until 2050 — roughly 420 plants a year. Measured in wind turbines instead, at 3 megawatts and a 0.30 capacity factor, that comes to about 2,000 turbines a day, every day, for 25 years.

I’ve published this analysis for years, and net-zero isn’t getting any closer — Net-zero 2050 is infeasible, by any practical standard, but that does not mean that the aspiration of net-zero is impossible.

Consider that if the net-zero target is 2075, then the implied pace of retirement and deployment is cut in half: about one nuclear plant every two days, or 1,000 wind turbines a day. As I’ve previously noted, if the world can maintain its historical pace of decarbonization (a big ask!) then the world would hit net-zero around the 2080s.

The pie chart above shows the change in total energy consumption from 2024 to 2025. You can see that carbon-free energy made up almost half the year-on-year additions. Fossil fuels still won out.

Below, the left panel extends the comparison of carbon-free to FF year-to-year change in global energy consumption back to 2010. Fossil consumption rose in every year except the pandemic year of 2020, and was outpaced by carbon-free in only one other year.

The right panel shows what is implied by a net-zero 2050 target — on average, every year to 2050: fossil energy decreases by about 21 EJ per year while carbon-free energy increases by nearly 28 EJ per year to cover both the retirements and continued demand growth

Reasonable people can argue over the exact required amounts of annual carbon-free deployment or fossil fuel retirement — it is huge regardless of the exact methods or assumptions.

Where did fossil fuel consumption increase and decrease 2024-2025?

From 2024 to 2025, the United States and China led all countries in added fossil fuel consumption, at +1.6 and +1.1 exajoules respectively — together more than the next dozen countries combined.

After the U.S. and China is a set of fast-growing developing economies: Indonesia, Türkiye, Bangladesh, and others added smaller but steady increments of fossil fuels as their energy demand continues to climb.

The countries that cut the most fossil fuel — Japan, Russia, South Korea, Colombia — trimmed only a few tenths of an exajoule each, an order of magnitude smaller than the increases at the top of the other chart.

The additions dwarf the subtractions: the largest reduction, Japan’s, would not offset even a fifth of the U.S. increase. As long as the countries adding fossil energy add far more than the countries cutting it subtract, worldwide fossil fuel consumption keeps climbing.

Decarbonization: so far, a long, straight line

The figure below shows the carbon intensity of the global economy 1992-2025 — CO₂ per unit of GDP.

The global economy has decarbonized steadily since well before climate policy existed — back to at least the 1960s.

Two things follow.

• First, global climate policy does not drive decarbonization as the decrease in carbon intensity of the global economy long pre-dates the climate movement (which started as coordinated global policy in 1992 with the Rio Earth Summit); economies growing wealthier and using more energy more productively have driven that trend.

• Second, and less comfortably: since the climate-policy era began in 1992 the background rate shows no acceleration. Hitting deep-decarbonization targets requires this straight line to bend down. It has not done so.

Some economies cut their carbon intensity by about two-thirds since 1990 — China, the United Kingdom, Germany. Others moved the wrong way and grew more carbon-intensive, led by Iran. These differences track different starting points, energy mixes, and stages of development — not the presence or absence of climate ambition.

What actually drives decarbonization?

The figure below shows a simple Kaya decomposition of global decarbonization: Carbon intensity of GDP equals the product of two factors: how much energy the economy uses per dollar (energy intensity), and how much CO₂ that energy emits (carbon intensity of energy).

Decomposing the decline shows how much each factor has contributed to global decarbonization.

The green line — the economy becoming less energy intensive per dollar of output — accounts for almost the entire decline in CO₂ per unit of GDP. The orange line — the carbon intensity of the energy that is consumed — has barely moved in 35 years, despite the impressive growth in carbon-free energy.

How much faster can decarbonization go? I will take that up in future posts.

The decarbonization rankings tables

The first table ranks the G20 economies and the world by how much their carbon intensity of GDP — carbon dioxide emitted per unit of economic output — changed from 2024 to 2025.

India and Argentina led, each cutting emissions per dollar of output by nearly 6%, followed by China and Saudi Arabia. Most major economies decarbonized, which is common: economies tend to achieve more output per unit of energy as they grow and modernize. However, others, including the United States, saw emissions growth outpace economic growth.

The world as a whole decarbonized by about 2.3% — a fairly typical rate. Compare that to deep-decarbonization targets for 2050 which imply a sustained global rate of decarbonization closer to 8-9% per year or more.

A single year, however, tells us little, since annual figures vary with weather, fuel prices, and economic cycles. The second table takes the longer view, ranking the same economies by their change in carbon intensity across the full Paris-era decade, from 2015 to 2025.

Here the leaders are the United Kingdom, Germany, and China, each having cut carbon intensity by a third or more over ten years. Only Indonesia moved the wrong way over the decade, its emissions outrunning even its rapid economic expansion. The world decarbonized by about 19% over ten years, or a little over 2% annually .

The third table asks: did the 2015 Paris Agreement bend the curve?

It compares each economy’s annual rate of decarbonization in the decade before Paris (2005–2015) against the decade after (2015–2025), and shows the difference.

A handful of economies accelerated sharply, though the largest movers — Saudi Arabia and Brazil — did so for reasons based on their own energy and economics circumstances, rather than efforts to comply with the Paris Agreement.

Global decarbonization changed little: from ~1.9% per year before Paris to ~2.1% after. China, which dominates global emissions, actually decarbonized more slowly after Paris than before, offsetting gains elsewhere.

A change in the decarbonization rate is not sufficient to prove policy causation on its own, but the lack of meaningful change at the global level is hard to square with the frequently-expressed claims that climate policy has already achieved notable success (such as we’ve been hearing related to the retirement of RCP8.5, but I digress).

Bottom line

The 2026 update is fully consistent with the pattern I have documented here year after year. Carbon-free energy is growing. Decarbonization continues its long, slow, pre-policy downward trend. Global fossil fuel consumption continues to increase. The carbon intensity of energy has barely budged, drifting downward ever so slowly. The gap between the required rate of change to hit aggressive decarbonization targets and the observed rate in the real world widens every year.

If we are to achieve deep decarbonization this century, the lesson to take is that we should start thinking about some different options for how to get there. What we have been doing isn’t working.

Before you go, a small request with big impact

Please click that “❤️ Like” button. Thanks!

Comments, critique, debate, discussion — all welcome at THB!

Posts like this one exist because of THB’s free and paid subscribers.

Thank you!

Reminder: At the bottom THB paid subscribers have access to an Excel file with all sources and data from the figures and tables from this post.

Methods Appendix

Energy and emissions data. All energy consumption and carbon dioxide emissions figures come from the 2026 Energy Institute Statistical Review of World Energy, which reports data through 2025. Energy uses exajoules (EJ); emissions use million tonnes of CO₂ from energy. Non-fossil energy (nuclear, hydro, and other renewables) follows the Physical Energy Content method the Statistical Review adopted in its 2025 edition, which counts non-combustible generation at its actual energy content rather than scaling it up to a fossil-fuel input equivalent. Earlier editions used the substitution (fossil-fuel-equivalent) method; the change lowered the reported carbon-free share by several points, as discussed in the post. This basis moves the level of the carbon-free share but not the direction of the trends.

Definitions. “Fossil fuels” means oil, natural gas, and coal. “Carbon-free” means nuclear, hydroelectric, and other renewables (renewables excluding hydro), so no source double-counts. “Total energy” sums fossil and carbon-free.

Carbon-free shares. The total-energy carbon-free share divides carbon-free energy by total primary energy, from the consumption-in-EJ tables.

Decarbonization and carbon intensity. Carbon intensity of GDP divides CO₂ from energy by real GDP. GDP uses World Bank GDP, PPP (constant 2021 international dollars), indicator NY.GDP.MKTP.PP.KD, which runs through 2024. Where a 2025 value applies, 2025 GDP extends from 2024 using country real-GDP growth estimates from the IMF World Economic Outlook, October 2025; these 2025 figures remain estimates, not final actuals, and carry that label. The figures index each series to a base year (1992 = 100 for the world curve; 1990 = 100 for the country series), so only ratios of GDP enter and currency units cancel.

Kaya decomposition (Figure 9). Carbon intensity of GDP equals the product of two factors: energy intensity of GDP (primary energy ÷ GDP) and carbon intensity of energy (CO₂ ÷ primary energy). Each factor and their product index to 1990 = 100. By construction the product line equals the carbon-intensity-of-GDP series in Figure 7 rebased to 1990.

Carbon intensity change table (2024–2025). For each G20 economy and the world, the change in carbon intensity of GDP comes directly from the two growth rates as (1 + CO₂ growth) ÷ (1 + GDP growth) − 1, using EI emissions growth 2024→2025 and IMF October 2025 real-GDP growth. This approach avoids constructing absolute 2025 GDP levels. The ranking runs from the largest reduction (most negative) to the largest increase.

Country selection. The top-20 emitters and the G20 come from 2024 CO₂ emissions in the Statistical Review; supranational aggregates such as the European Union drop out of country rankings.

Approximations. No values in the figures or table approximate or interpolate anything except the labeled 2025 GDP estimates described above. All emissions and energy values match the 2026 Statistical Review as reported.

Sources and data file below.