Policy reversals in major economies and shifting public priorities create an atmosphere of uncertainty that affects every sector. Even the most bullish industries are not immune to despondency.
Yet the findings of DNV’s Energy Transition Outlook 2025 show that while the transition is uneven and slower than the world needs, it is not in decline. Despite the pessimism, it continues to move forward, reshaped by security concerns and an accelerating shift toward competitive renewable electricity.
MOMENTUM PERSISTS, BUT UNEVENLY
Some elements of the transition, particularly those driven by market fundamentals, are accelerating so quickly that they are becoming virtually unstoppable.
Solar PV, onshore wind and batteries have plunged in cost, largely due to China’s massive industrial scale clean energy manufacturing. As a result, variable renewables will account for 32% of global power by 2030, and more than half of the world’s electricity by 2040.
Electricity generation will grow exponentially, expanding 120% by 2060 as well rapidly becoming less carbon intensive, with the fossil share of power supply collapsing from 59% today to just 4% by 2060.
Yet other parts of the transition, those dependent on high-cost technologies or strong policy continuity, are struggling. Hydrogen and its derivatives, like methanol and ammonia, floating wind and novel nuclear solutions feature more muted growth in our forecast. While these technologies remain essential for decarbonizing hard-to-abate sectors, their large-scale deployment is not expected until the 2040s.
Such divergence means that the overall transition is now marginally slower than DNV projected a year ago. And yet, despite short-term turbulence, we forecast that fossil fuels’ share of global primary energy will fall from 80% today to 36% by 2060, an unprecedented shift in the modern energy era.
SETBACK IN NORTH AMERICA
Much attention has focused on the policy reversals in the United States, where the rollback of climate measures and the renewed promotion of fossil fuels are delaying the region’s transition. Our modeling shows the changes will set back North America’s emission reductions by about five years and leave the region emitting 500–1,000 Mt more CO2 annually through to 2050 than previously expected.
These reversals do not meaningfully alter the global picture though, with China continuing to set renewables buildout records, installing more than half of the world’s new solar PV capacity and 60% of new wind. Many countries, particularly in the Indian Subcontinent, Southeast Asia and Africa, are adopting Chinese clean technologies at scale. Europe, despite some economic and political headwinds, remains firmly committed to climate action while simultaneously striving to protect industrial competitiveness.
Across all regions, energy security now shapes energy policy as much as affordability and sustainability. Governments are seeking to reduce import dependence, build up critical supply chains and protect domestic manufacturing, all of which will take long time. This shift simultaneously boosts renewables in many importing regions, where solar, wind and nuclear are seen as secure domestic options, while increasing fossil output in exporting regions such as North America and the Middle East.
THE GRID BOTTLENECK
Electrification is the defining feature of the transition and electricity’s share of final energy demand will double from 21% today to 43% by 2060. But this rapid electrification is exposing the structural weakness in the world’s power grids, which are still expanding far too slowly.
Europe is already experiencing a “gridlock” that constrains renewable deployment. DNV’s analysis shows solar capacity in Europe could be 16% higher and wind 8% higher by 2035 if grids were built at the required pace.
North America faces a similar challenge, compounded by surging energy demand from AI data centers. While AI’s energy use may seem alarming, it will represent only 3% of global electricity by 2040. Still, in North America, where data center activity has the highest concentration, AI will account for an extraordinary 12% of electricity demand by that year.
OFFSHORE RENEWABLES
Offshore wind has recently faced rising costs, supply chain difficulties and delayed project pipelines, but our outlook shows a strong resurgence from 2030 onward. Costs stabilize and supply chains mature, setting the stage for offshore wind to become a central pillar of low-cost, energy-secure power systems. In the longer run, floating offshore wind is also poised for significant expansion as nations with deep-water coastlines seek domestic renewable resources.
Behind-the-meter solar and storage, already one-third of global solar installations, demonstrate how distributed generation is changing energy systems on land. A similar decentralization is emerging offshore, where hybrid floating platforms can power oil and gas operations and reduce emissions from maritime infrastructure.
Harder-to-decarbonize sectors face a slower trajectory than previously forecast. The global share of hydrogen in the 2050 energy mix has declined over the last three years from 4.8% to 3.5% in our outlook, reflecting delayed industrial adoption and slower cost reductions.
EMISSIONS ARE FALLING, GRADUALLY
Global CO2 emissions are expected to peak in 2025 and fall 43% by 2050. But this is not enough to meet the Paris Agreement. The remaining carbon budget for 1.5°C will be exhausted in 2029, and the world exceeds 2°C around mid-century unless stronger action is taken. By 2100, our forecast trajectory leads to around 2.2°C of warming, underscoring the need for faster decarbonization across all sectors.
For the ocean technology and maritime sectors, the transition is still moving, in some cases decisively, but it needs acceleration. Electrification, offshore wind, ocean-based renewable systems, zero-carbon fuels and subsea infrastructure will define the next phase.
The transition may be slower than we want, but it remains unstoppable. Our task now is to scale what works and fix what is blocked, ensuring the ocean industries remain at the forefront of the clean energy future.
This feature appeared in ON&T Magazine’s 2026 January Special Edition, The Future of Ocean Technology Vol. 6, to read more access the magazine here.
