March 13, 2025

Written By: Pelino Colaiacovo

Maybe a medical metaphor is the wrong kind to use? It might be better to ask whether the Energy Transition has gone into hiding. Or maybe…maybe, it has gone underground? Like the “hero” in a movie that is accused of a crime, and is running scared, but with an extremely unlikely but sure to work in the end “plan” to prove their innocence! Ok, whatever….

Donald Trump is President of the United States – again! – and in addition to vowing to reverse all support for renewable energy, quit all climate change treaties and agreements, and rescind any policy that was ever promulgated by a Democrat or a non-MAGA Republican (well, OK, maybe that last bit is hyperbole, but it sure feels that way…), he has also completely distracted the world from all other problems by declaring a multilateral trade war and withdrawing support from Ukraine in its hour of need. 

Clearly, the Energy Transition is in trouble in the United States, but while politics matter, the energy transition has deeper roots – market dynamics, supply-chain shifts, and structural demand changes that government headlines don’t always capture.

The Global EV Revolution Accelerates

The cheapest cars in the world are now EVs made in China. They are being sold in Asia, Africa, Latin America, and the Caribbean, and are also entering Europe. Even if North America will not see any of them any time soon, the global auto market is changing before our eyes, with long-term consequences for petroleum demand and hence production.

In 2024, EVs accounted for 21% of global car sales – meaning one in five cars sold worldwide were electric. Traditionally, the transportation sector globally consumed about 65% of all petroleum produced, but with sharply declining sales of gasoline and diesel vehicles, how long will that level of demand hold?

Solar: The Cheapest Electricity on Earth

Solar photovoltaic facilities are the cheapest form of electricity production in many parts of the world, on a totally unsubsidized basis. The LCOE of solar PV was 56% less than the weighted average of fossil fuel-fired alternatives in 2023, having been 414% more expensive in 2010.

The globalized weighted average levelized cost of electricity (LCOE) of utility-scale solar plants stood at $0.043/kWh in 2024. In other places, wind power holds that honour. True, electricity systems can’t run with just these resources, but dollars and cents (or Euros, Pesos, Yen, Reai, Renminbi or what have you) mean that more renewable energy projects will be built in most parts of the world, even though Mr. Trump prefers “drill baby drill” to “spin me right round baby right round” or “sunshine of your love”.

In 2023, the global weighted average levelised cost of electricity from newly commissioned utility-scale solar photovoltaic, onshore wind, offshore wind, and hydropower fell, with utility-scale solar PV projects showing the most significant decrease of 12% between 2022 and 2023. The economics are simply too compelling to ignore.

Heat Pumps: The Silent Revolution in Home Heating

Air-to-air and air-to-water heat pumps are now the cheapest form of residential and small commercial heating and cooling in any jurisdiction that has winter temperatures warmer than -5 °C. That doesn’t help much in Canada, but it applies to most of the population in the world. 

Global production of heat pumps is growing by leaps and bounds (10% CAGR expected until at least 2030), and the technology continues to improve rapidly. Supportive policy helps, but is not necessary for continued growth, which will mean less use of natural gas, propane, and fuel oil for heating in the future (and more efficient cooling in warm months).

Innovation Continues at Breakneck Speed 

Billions of Dollars, Euros, Yen, Renminbi, etc. have been and are being invested around the world in clean-energy innovation. Every major economy is directing record levels of capital toward technologies that are redefining how the global economy generates, stores, and consumes energy.

Progress in advanced battery technologies (solid-state, lithium-sulphur, zinc, graphene, etc.) is moving faster than ever, promising higher energy density, faster charging, and longer life cycles. Meanwhile, engineers are creating next-generation electric motors (magnet-free, axial flux, etc.) that deliver more power, improved efficiency, and reduced reliance on critical minerals.

Innovation is also accelerating in materials science. Higher performing and cheaper insulation materials (ultra-high reflectivity coatings, nanoparticles) are helping buildings, vehicles, and industrial systems achieve greater energy efficiency — a key step toward global emissions reduction targets.

In nuclear energy, developers are advancing safer and more adaptable designs such as SMRs (small modular reactors) and Gen-V reactors, which offer flexible baseload generation with a smaller environmental footprint. At the same time, breakthroughs in the hydrogen economy,  particularly in cheaper hydrogen production (biological, high-pressure electrolysis, photoelectrochemical, etc.), are unlocking new opportunities in industrial decarbonization and clean fuel applications.

Together, these rapid energy-technology advancements are driving an unprecedented transformation. Breakthroughs are being announced almost daily, attracting private investment, and inspiring new business models that are redefining the future of the global clean-energy economy.

The Supertanker Analogy: Momentum is Everything 

So if the Energy Transition is about the move away from fossil fuel-based energy, and towards greater use of electricity that is generated through non-emitting sources, this seems to be still happening, and potentially at an even faster pace than in the past two decades. 

This is where the analogy of a “supertanker” can be applied not only to the fossil fuel economy of the past 100 years, but also to the new “green” economy that has been formed over the past 20 years: it is now so large, with so much capital behind it, that it has developed an inertia of its own. Mr. Trump can try to push the bow of the Energy Transition tanker to one side, but he is unlikely to change its course substantially in his four-year term.

The Canadian Context: Provincial Leadership Matters

Here in Canada, the consumer carbon tax is about to die. If the government in Ottawa changes political stripes, more green energy programs could disappear as well. But many provinces are still going to be procuring wind and solar power projects, as well as electric battery storage facilities, and hydrogen or ammonia production and sale to Europe may still make sense. Not to mention new nuclear builds! And many new electricity transmission lines, and distribution expansion to serve electric cars, etc.

The provincial-level commitment to clean energy infrastructure reflects a pragmatic recognition that renewable energy investments make economic sense independent of federal policy direction. Utilities and independent power producers are moving forward with projects that deliver competitive electricity costs while meeting decarbonization goals.

The Impact of Climate Change 

Behind all of this, of course, are these two not-so-little sad realities:

Rising Global Temperatures

The data from NASA shows an unmistakable upward trend in global average temperatures compared to the 1951-80 baseline. Each decade since the 1980s has been progressively warmer than the last, with the most recent years showing the most dramatic departures from historical norms.

Accelerating Atmospheric CO2 

NOAA’s atmospheric monitoring shows CO2 concentrations continuing their relentless climb, now exceeding levels not seen in millions of years of Earth’s history. The rate of increase shows no sign of slowing despite decades of climate negotiations and commitments.

Despite the fact that President Trump’s administration may defund the agencies that collect the scientific data that support these graphs, the impacts of this changing climate reality – in heat waves, hurricanes, fires, droughts, and general climate and political instability, with more and more acute (and uninsurable!) economic losses and human suffering – will only be increasing.

Conclusion: The Transition Continues 

Temporary lack of action by governments on the Energy Transition – and downright hostility from the Trump administration and potentially other similarly inclined governments – may mean that, locally and temporarily, the public profile of the issue falls, but the general trend of an advancing Energy Transition on a global basis is not going to change direction. It will continue to make sense to look for business opportunities in all of its various nooks and crannies – I know I will!