How do you explain the boom in solar energy we’re seeing today?
Renewables are scaling fast because it’s become affordable and quick to deploy. In 2025, utility-scale photovoltaic solar was in the ~USD 38–78/MWh range, which explains why solar keeps winning new-build decisions in many contexts. As more countries install solar and wind, costs and scale reinforce each other — a virtuous cycle. For example, in the European Union (EU), renewables overtook fossil fuels in the electricity mix. The next phase is about integration: grids, flexibility and storage so renewables can keep growing reliably.
The big issue now isn’t generation — it’s integration.
Has this actually changed the global climate outlook?
Yes, and this part often gets overlooked. We think there’s been no progress on climate change, and politically, that’s often true, but if you look at the energy data, the story is more nuanced.
About 10 years ago, we were looking at around 3.5°C degrees of warming based on existing policies and pledges. Now we’re closer to around 2.6°C. That’s largely because the massive coal build-outs that were once expected never happened. In the last 10 years, over 60 countries scaled back their planned coal expansions or removed coal power entirely from their future energy strategies.
Instead, renewables took off, accounting for over 92% of total power expansion in 2024. That’s because public support drove down costs, and once renewables became cheap, countries started choosing them over coal.
It’s not enough, but it’s still a big shift.
How much is energy security shaping clean energy policy now?
A lot. There’s been a big shift.
Renewables are now recognized for their capacity to diversify energy supply and — once installed — provide a domestic source of energy that is not reliant on imports or volatile fuel markets. Even if price hikes or trade disruptions occur for components, they only impact new capacity, not existing systems.
For example, renewables helped moderate the EU’s energy crisis that followed Russia’s invasion of Ukraine. Without its wind and solar power capacity, the EU would have needed 993 TWh (94 bcm) more gas from 2022 to 2023 alone, costing EUR 135 billion and increasing reliance on Russia.
In Pakistan, consumers are taking matters into their own hands and installing record levels of rooftop solar, driven partly by problems with the grid. This has reduced the country’s heavy reliance on expensive, imported fossil fuels, but the transition needs to be carefully managed to ensure grid stability.
Energy transitions are never just about economics — they’re political.
If, as we said, the price is not a barrier anymore, what’s still holding renewables back from fully taking over?
The big issue now isn’t generation — it’s integration.
Countries don’t really need to subsidize solar and wind anymore. What they need to support are grids, storage, and technologies that balance power in the short and long terms. They also need to stop subsidizing fossil fuels, which distorts the market.
We’re changing an entire energy system from centralized base-load fossil generation to distributed and variable generation. And higher proportions of variable renewables require more interventions to ensure reliability, like batteries and other forms of balancing and storage.
This is especially hard for developing countries. If your whole system is built around coal power flowing from a power station to businesses and households, switching to renewables in new locations with new storage needs is extremely expensive, requiring massive investments in grids. Even rooftop solar can be expensive to integrate, requiring upgrades to local electricity connections and networks. Supporting poorer countries to make this transition is the challenge and responsibility of richer countries over the coming decades.
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What do you see as the next major phase of the clean energy transition?
Two big things.
First, we’re going to see much more support for diversifying critical mineral and rare earth supply chains. These materials are essential not just for clean energy, but for a lot of modern technologies.
Second, there will be a shift in what governments support. Less money for generation, more for integration: grids, storage, and flexibility.
For lower-income countries, this is going to be a huge challenge. There will need to be a lot more international public finance. Otherwise, they simply won’t be able to afford the transition.
Are we at a point where the shift to clean energy is irreversible?
In many ways, yes.
We have already passed tipping points for key technologies, including battery storage, wind, solar, and electric vehicles. But challenges remain in plenty of sectors, like aviation and heavy industries.
And energy transitions are never just about economics — they’re political. Some countries are still pouring money into fossil fuels even when renewables are cheaper. But the big difference now is this, at least in the power sector: clean energy is no longer an alternative. It’s the default.
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This article was originally published by the International Institute for Sustainable Development (IISD) and is republished here as part of an editorial collaboration with the IISD.
Editor’s Note: The opinions expressed here by the authors are their own, not those of Impakter.com — Cover Photo Credit: Tom Fisk.
