The decisive trajectory of the global energy transition will be determined by emerging economies whose scale, demand growth, and infrastructure gaps are reshaping investment realities, Sony Kapoor, Macroeconomist and Policy Adviser, tells OGN.

Kapoor identifies China as on course to becoming the first major ‘electro state’, with India following, arguing that outcomes in such populous markets will outweigh action in Europe in shaping climate results.

Rapidly rising global energy demand means most additional supply now comes from renewables, while total oil and gas use has not yet recorded serious declines apart from coal, indicating a parallel expansion rather than outright replacement.

Over the next 5 to 10 years, Kapoor expects only marginal reductions in oil and gas consumption, with renewables supplying the lion’s share of incremental generation before economies of scale eventually erode fossil fuels’ still-large share, a shift already visible in electric vehicles.

Energy justice remains central to policy design, Kapoor stresses, citing Nigeria, where more than 200 million people rely on a national grid with less capacity than the city of Austin, whose population is about one to two million, and which experienced a nationwide grid failure for one or two days in September 2024.

Such disparities underline a world he characterises as structurally unequal, particularly as tropical and subtropical developing states face frontline climate risks including heat stress and flooding, even as they pursue higher-value uses of hydrocarbons to avoid stranded investment.

This shift will redefine capital allocation, competitiveness, trade flows, and technology leadership across energy systems worldwide over coming decades significantly.

He emphasises the transition’s direction is therefore set by emerging markets’ choices, capital flows, and technology adoption rates.

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