From The Honest Broker

By Roger Pielke Jr.

Each year, the Norwegian company DNV (Det Norske Veritas — The Norwegian Truth in English) publishes a global Energy Transition Outlook (ETO). I appreciate the DNV Outlook not because I always agree with it, but because they are transparent in their methods and update their work annually, identifying how assumptions and projections have changed over the past year.

The DNV also publishes a projection that they believe to be the “most likely” future trajectory based on what we know today, rather than relying on conditional scenarios. They explain:

The ETO is a simulation-based forecast that reflects how the energy system behaves under a most-likely scenario. It is not a best-case pathway or a cost- optimized solution.

There are strengths and weakness to both system and scenario approaches for projecting the future. DNV is fairly unique in its use of a systems approach to produce a “most likely” projection.

The DNV acknowledges that a lot has changed since its 2024 report, but maintain that the global energy systems is on the brink of irreversible change:

Faced with these developments, a casual observer might conclude that the energy transition is stalled or in reverse. That is most definitely not the case. The energy transition is rolling on.

Today I share 10 of the figures of their just-released 2025 ETO that I find particularly interesting. There is much more in the full report, which I encourage any energy nerd to read closely.

Before getting to the figures, it is important to understand how DNV characterizes its approach:

• Producing a best estimate of the energy future, which differs in many ways from the future we want to see unfold
• Publishing a single ‘most likely’ forecast, and not a range of scenarios, which often serve to confuse rather than inform
• Emphasizing and exploring long-term dynamics rather than short-term imbalances
• Focusing on proven technologies and excluding unproven or future potentially ‘breakthrough’ technologies
• Incorporating main policy trends; treating untested policy commitments with caution
• Modelling effects of behavioural changes — e.g. in relation to energy efficiency.

On to the ten figures . . .

Little Global Impact of the US 2024 Election

The ETO explains:

This year, we project an energy transition that is marginally slower than the transition we forecast last year, both in terms of emissions and fossil’s share of primary energy.

In the US, fossil fuel promotion and the reversal of clean energy support policies markedly slow that nation’s transition. Emission reductions are delayed by about five years (Highlight 1) and through to 2050 annual CO2 emissions are reset 500 to 1000 Mt higher than we predicted one year ago.

Future GDP Growth Estimates are Lower

The ETO explains:

In our counterfactual analysis, the revised GDP pathway results in 6.3% lower emissions in 2050 compared with a pure SSP2 case (Figure 1.2). Slower convergence between rich and poor regions also means energy demand, along with emissions, grows more slowly in low-income countries. The revision therefore carries a double message: the energy system may face less pressure from demand growth, but the social challenge of uneven development becomes sharper.

This projection is consistent with recent work of my colleague Matt Burgess and is discussed in depth here at THB.

Take the Under – by Roger Pielke Jr. – The Honest Broker

Note also that DNV projects a 2100 global population of 9.9 billion, which is only marginally less than the U.N. 2024 medium population projection. The low fertility projection drops to about 7 billion, so there is lots of room for future downward revisions to the DNV GDP projections — which I expect to see in future iterations of the outlook, based on my reading of recent demographics literature.

In 2026 Fossil Energy and CO2 Emissions Start a Slow and Protracted Decline

DNV explains:

The most critical aspect of the global energy transition is the replacement of fossil energy by non-fossil energy. That is easier said than done; fossil energy currently represents 80% of all energy use, and has done so for more than 60 years. One could therefore conclude that the global energy transition has not yet started.

However, we believe that the transition has started, but the change is gradual and almost imperceptible at a global level. Global energy-related emissions are most likely peaking in 2025 and will start to fall from 2026 onwards. . .

We forecast that the fossil fuel share of primary energy will reduce by more than 1% per year, from 80% today to 36% in 2060. By historical standards, that pace of change is unprecedented. However, the transition is not fast enough to reach Paris Agreement climate targets. The transition is likely to leave most stakeholders dissatisfied: far too slow to prevent dangerous climate change as the IPCC defines it and fast enough to disrupt the vast fossil fuel industry and bring turmoil to fossil fuel exporting countries that have enjoyed decades of profit and power.

However slow it may be, the transition is inevitable. No policy reversals, budgetary deficits, or geopolitical crisis will stop it. Solar PV, onshore wind, and batteries — the three most important technologies needed for the transition — are now so inexpensive that they outcompete fossil energy in a constantly growing number of areas. While the direction of the transition is set, the pace of the transition is not a given.

AI Electricity Demands are Potentially Massive and Highly Uncertain

The ETO explains:

A review of over 50 publications with recent estimates (Kamia and Coroamă, 2025), shows a vast range in global data centre energy demand for 2030 (210-7,900 TWh) (Figure 3.5). Our forecast lies on the lower end of the base case estimates. Towards 2040 and beyond, there are limited sources to compare with and likely much higher uncertainties. Our forecast necessarily reflects assumptions based on existing technology developments, the persistence of which is itself highly uncertain. For example, we assume that AI will not be wholly immune to the productivity paradox that has characterized information technology investments to date — famously summarized in Robert Solow’s quip that, “You can see the computer age everywhere but in the productivity statistics” (Solow, 1987).

We are also sympathetic to the view advanced by the OECD in micro-to-macro modelling of AI’s contribution to labour-productivity which suggests that aggregate gains from real-world AI deployment will likely align with mainstream productivity ranges rather than with a step-changes. Yet, how that unfolds over time is uncertain because technological breakthroughs will inevitably occur (e.g. AI evolving to learn from the real world and not static data sets).

Buh-Bye Coal

The ETO pulls no punches here:

Despite the present highs, coal demand is on the brink of a cliff.

I’ve long argued that coal retirements and replacements with lower (or zero) carbon alternatives offer the lowest hanging fruit for fast and deep emissions reductions. Read more on coal:

Low Hanging Fruit – by Roger Pielke Jr. – The Honest Broker

A Coal Exit Treaty Can Radically Simplify and Accelerate Climate Policy

CO2 Emissions Peak in 2025 and Global Temperatures Top Out at +2.2C in 2100

DNV explains:

We forecast the 1.5°C carbon budget threshold will exhaust by 2029 and the 2.0°C budget by 2052. Extending the forecast pathway to 2100 with modest removals implies net zero CO2 in the early-2090s, resulting in 2.2°C warming by the end of the century.

The DNV projection is almost identical to the scenario our recent analysis found to be most consistent with observations and near-term energy system projections.

Pielke Jr, R., Burgess, M. G., & Ritchie, J. (2022). Plausible 2005-2050 emissions scenarios project between 2 and 3 degrees C of warming by 2100. Environmental Research Letters.

Since then, I’d hypothesize that the envelope of plausible scenarios has dropped even further.

Twenty years ago, net zero by 2093 and a 2.2C temperature increase would have been considered by climate experts to be both fantastically optimistic and an incredibly successful outcome of climate policy.

The Path to Net Zero Will be Long and Slow

Anyone hoping for a rapid energy transition should reset their expectations. DNV concludes that net zero by 2050 is simply off the table, but all is not lost:

Our forecast is that by 2050, energy and process-related CO2 emissions will be at 22 Gt, a reduction of only 43% from today. The gap between our forecast of the ‘most likely’ energy future to 2050 and net zero by then is huge. Considering current societal priorities, we believe this gap cannot, in any feasible way, be closed through technological advances and/or political will by 2050. Therefore, this year we now state that we find net-zero CO2 emissions in 2050 beyond reach.

The natural question is then: when are we likely to reach net-zero emissions?

We expect global net-zero CO2 emissions in the early 2090s. After that, further emissions will shrink and the uptake of negative emissions technology to continue, turning emissions effectively net negative. As a result, the global temperature will stabilize around that time at 2.2°C above pre-industrial temperatures.

DNV further explains:

Using these AR6 budgets and our cumulative CO2 pathway, we estimate that the 1.5°C budget is exhausted in 2029 and the 2.0°C budget is exhausted in 2052. . . .

Emissions decline steeply by 2060, supported by increasing CCS. The decline in emissions, combined with negative emission technologies and land-use changes, achieves net zero by 2093, with the potential for net-negative emissions thereafter. . .

Using AR6 climate-response parameters and evaluating our pathway against the 67%-probability 2.0°C budget, the resulting overshoot of 345 GtCO2 implies end-century warming of approximately 2.2°C above pre-industrial levels by 2100.

China, India, and the Middle East and Africa Have Mountains to Climb

The ETO explains:

Emission paths diverge across regions. Greater China peaks in 2030 and then declines to 85% of 2024 levels by 2060. Emissions in the Indian Subcontinent rise rapidly to the 2030s, plateau, and then decline from 2040 to end 38% lower 2050 2060 Buildings Energy sector Other than today in 2060. Sub-Saharan Africa’s emissions increase 42%. Other regions reduce with Europe reaching net zero, OECD Pacific (92% reduction), and North America (85% reduction) by 2060. On a per-capita basis in 2060, North East Eurasia has the highest emissions at 4.5 tCO2/yr, followed by the Middle East and North Africa (2.7 tCO2/yr) and North America (1.9 tCO2/yr).

Comments, questions, debate, discussion all welcomed!