Although significant progress has been made toward the energy transition, forces such as shifting geopolitics, policy uncertainty, the macroeconomic environment and rising energy demand continue to create uncertainty.
In a recent article, McKinsey Global Institute points out the energy transition is highly complex, requiring a physical transformation on a massive scale. This will require, as McKinsey noted in its 2024 report, “tackling the hard stuff.” In its recent article, the institute draws on research from 2024 to highlight 10 key physical realities relevant to the core components of the transition. These are as follows:
Today’s energy system is high-performing but also has flaws
Only about 10 percent of low-emissions technologies needed by 2050 to meet global commitments have been deployed
A metamorphosis of the power system has to be at the heart of the transition
Electrifying heat will require managing higher demand peaks
