The US withdrawal from climate talks has certainly caused disruption in global markets over the issue of energy transition. But the contemporary energy transition now rests on a much broader foundation than the actions of any one nation. Pim Waldrey, head of climate and nature economy at the World Economic Forum, says advances in technology, falling costs and strong demand are driving the rise in electrification and renewable energy in both advanced and emerging economies. This could lead to success at COP30 in an otherwise difficult year.
Excerpts from the interview:
1. Following the US withdrawal from the Paris Agreement, how is the industry responding to climate goals? Have there been significant changes in direction?
The global context following the announcement of the US withdrawal from the Paris Agreement was a demonstration of both the complexity and flexibility of global climate action. While the move prompted reflection internationally on the future of global climate cooperation, broad support for decarbonization persisted, driven by an increasingly diverse coalition of businesses, governments, and civil society actors.
More than 100 countries have reduced fossil-fuel imports as renewable energy has become more competitive, saving an estimated $1.3 trillion since 2010. The International Energy Agency expects this trend to accelerate during this decade. In practice, sectors ranging from energy and technology to industry have maintained their ambitions, some even raised them, setting tougher emissions targets and investing in innovation and transparency.
Business initiatives have played an influential role. For example, ahead of COP30, the Forum’s Coalition of Climate Leaders published an open letter calling for accelerating policy and highlighting the economic opportunity for climate action. International cooperation facilitated by various platforms and knowledge-sharing efforts has made the low-carbon transition not the task of any one country, but the hallmark of broad-based economic progress. Furthermore, the Coalition of CEO Climate Leaders announced that members have reduced their total emissions by 12% between 2019 and 2023, while increasing revenues by 20% over the same period – demonstrating that there is no contradiction between effective decarbonization and strong economic performance.
2. How are disruptive tariff policies affecting markets and the energy transition?
Trade tensions, tariffs and regulatory fragmentation have complicated the global landscape of clean technology and energy. These developments have disrupted supply chains, increased costs and exposed sectors dependent on critical minerals to new risks. However, these pressures are also driving a strategic shift in thinking by both industry and government.
Some economies have responded by accelerating investment in domestic capacity. In the US, the rapid expansion of clean-tech manufacturing has been coupled with a renewed focus on critical-mineral supplies; Latin America has seen new frameworks in responsible mining. In Asia-Pacific, projects such as the ASEAN Power Grid and the rise of cross-border green hydrogen initiatives are providing regional alternatives to volatile global markets.
Collaborative mechanisms are underpinning this progress. The Forum’s First Movers Coalition, for example, helps meet global demand for green technologies, while corporate advances in circular supply chains and battery recycling are becoming common.
While this phase of uncertainty presents strategic challenges for the private sector, it has also catalyzed the emergence of new alliances and regional and global value chains. Driven by both adversity and opportunity, the pressure for green growth and energy transition continues.
3. How are industry leaders incorporating clean technology, electrification and renewable energy – and what drives today’s investment and innovation?
The integration of clean technologies, electrification and renewable energy is now shaping an increasing share of the industrial landscape. For the first time, global clean energy investments exceed $2 trillion in 2024 – $800 billion more than fossil fuels, with renewables now the primary source of new electricity generation worldwide.
Leading companies have adopted advanced grid management and digital optimization, typically using AI and data analytics, often with partners. In hard-to-reach areas, the Forum’s Transitioning Industrial Clusters initiative is working in regions from Europe to India to bring collaborative approaches to hydrogen and green steel.
The result: Technical insights and practical alliances are now at the center of the green transition, with solutions championed by investors, policy makers and firm-level leadership alike.
4. How are Indian companies managing the transition and the path to net zero?
India’s corporate climate landscape is marked by both speed and complexity. Nearly 130 Indian firms have now validated net zero targets under the Science-Based Targets initiative, part of a broader global trend in which a third of the world’s largest public companies have pledged to align with climate targets. Yet progress is uneven: sectors such as power, cement and materials remain challenging, with only one in ten firms committed to net zero, reflecting capital intensity and technical barriers to rapid decarbonization.
However, many Indian companies have quietly taken up leadership roles. Tata Steel and Mahindra, both part of the global CEO alliance, are pursuing Scope 3 emissions reductions through supplier engagement, renewable procurement and more sustainable supply chain management. Their focus includes investments in energy efficiency, electrification and green fuels, positioning them as leaders in so-called hard sectors.
ReNew, a leading renewables and decarbonization solutions company, has maintained carbon neutrality for its direct operations for two years.
Such efforts outline a pattern in Indian industry: while the path to net zero is not straightforward, strategic investments, cross-sector alliances and continued innovation are providing a model for practical, scalable progress.
5. Do you think America’s push toward fossil fuels could destabilize the energy transition?
Energy policy in major economies essentially shapes global markets. Yet the contemporary energy transition now rests on a much broader foundation than the actions of any one nation. Advances in technology, falling costs and strong demand from private investors to consumers underpin the continued growth of renewable energy, electrification and emissions reduction in both advanced and emerging economies.
The coalition formed by business, investors and policymakers continues to reinforce this momentum. More than 100 countries have cut fossil-fuel imports, saving more than $1.3 trillion since 2010, while investment in renewable energy and battery storage now far exceeds spending on fossil fuel infrastructure.
Long-term investment cycles and a diverse energy portfolio have increased the system’s resilience to short-term political changes. In practice, the net-zero transition moves forward in most regions, supported by regional leadership and the proliferation of country and cross-border partnerships. Progress towards a cleaner, more resilient energy system is now an international project, shaped by local priorities as well as shared ambition and innovation.
6. How will AI fuel the boom in data centers and what will be its impact?
AI data centers are becoming increasingly important in global electricity demand, with electricity demand projected to increase by approximately 10% by 2030. Their expansion raises questions about how digital infrastructure can be reconciled with climate goals.
The industry response, in part, has been to invest in renewable energy supply and AI-driven grid optimization, sometimes in partnership with utilities and national governments.
Both public and private partnerships are accelerating efforts to decarbonize the energy supply. Some companies are making joint investments in advanced nuclear, large-scale solar and grid balancing, while industry standards are emerging to encourage transparency and data-sharing in real-time energy use.
If managed thoughtfully, the surge in AI and digital infrastructure can serve as a proving ground for deep grid resilience and rapid decarbonization, but it requires a dedicated strategy to integrate nature and climate from the beginning of business strategies.
