Human civilisation requires a continuous supply of energy, which it generates from various sources, including fossil fuels, nuclear power and renewable energy. Achieving net zero globally will require either ending the use of fossil fuels and switching entirely to clean power options or decarbonising fossil fuels — likely some combination of the two.

Progress Towards Net Zero Energy

  •  Energy efficiency continues to be the most effective single route to emissions reduction and energy security, recognised by the International Energy Agency as the ‘first fuel’ and as indispensable to realising climate goals. 

  • Renewable energy sources, including wind and solar, are the fastest growing globally. They are expected to contribute 45% of global electricity generation by 2040

  • Despite some countries continuing to invest in coal, global coal burning has seen a steady decline since peaking in 2013 and the total number of new coal plants under construction fell by 84% between 2015 and 2018.
  • Carbon Capture and Storage (CCS) with geological sequestration is currently the most permanent solution proposed for balancing ongoing fossil fuel emissions from large-scale power generation and industrial processes, and costs have fallen significantly over the past decade.
Energy production and use is the largest source of global greenhouse-gas (GHG) emissions, meaning that the energy sector is crucial for achieving [the Paris Agreement objectives]. – IEA

Key Challenges

Meeting Sustainable Development Goal 7 of affordable, reliable, sustainable and modern energy for all is an immense challenge. In the wealthier parts of the world, this will involve major efforts to bring down demand while electrifying most heating and transport and supplying the electricity from renewable sources. In the global South, the focus will be more on universal access to renewably-sourced electricity and on avoiding lock-in to high demand, e.g. through careful design of buildings and transport infrastructure.

Many countries’ electricity grids are undergoing extensive changes in order to handle the combination of increased renewable sources and new patterns of demand. Increased energy storage and more flexible demand are critical in transitioning towards a low-carbon energy system.

Ongoing fossil fuel subsidies from governments distort market competition and may slow the growth of renewable energy sources in many countries.


A picture of wheat fields in Ukraine.

Image of technicians working on solar array as a part of the Afghanistan Clean Energy Program (ACEP).Photo Credit: Robert Foster, Winrock International

Net Zero Innovations for Energy


Policy package innovations to promote less energy-intensive practices, energy efficient design,  building and infrastructure retrofits, skills training for zero-carbon economies and reductions in fossil fuel subsidies can all pave the way for more workable transitions in supply and remediation.

Shifting generation toward renewables

The levelised cost of solar electricity and onshore wind power has fallen below that of both nuclear and fossil fuel in many parts of the world over the past years and this trend is set to continue. This presents an opportunity to decarbonise energy generation from fossil fuels by shifting to renewables.

Storage and flexible demand

Falling costs of battery storage and the growth of demand response programmes enable more widespread adoption of variable renewable energy sources, such as wind and solar.

Carbon Capture and Storage

Carbon Capture and Storage (CCS) technology has matured considerably over the past decade. Many countries, including Saudi Arabia, have considerable geological potential for storing carbon dioxide emissions underground.

Green Hydrogen

Dedicated electricity generation from renewables or nuclear power offers an alternative to the use of grid electricity for hydrogen production. With declining costs for renewable electricity, in particular from solar PV and wind, interest is growing in electrolytic hydrogen and there have been several demonstration projects in recent years.

Net Zero Policy for Energy

Governments need to pave the way for the energy transition at every level which means putting in place policies that allow and incentivise action for individuals, communities and large institutions to make the switch to clean power and/or offsetting solutions. 

Communities are already experimenting with energy transition initiatives. From a national perspective, they may be incentivised to alter their consumption patterns or generate, renewable power through a variety of policy options:


Utility companies can develop metering and tariffs to stimulate residential renewable energy generation by compensating businesses, homeowners or other producers for electricity fed back into the grid, and for shifting their demand in response to system needs at a given time..


Green/Infrastructure Banks blend public and private capital to fund the upfront cost of clean energy improvements, including insulation. The intent is to reduce the risk for the investor and to scale the market for projects.


Commercial Property Assessed Clean Energy (C-PACE) is a financing mechanism used by local governments that allows commercial, industrial, and multi-family property owners to finance energy efficiency and renewable energy improvements through their property tax payment.


Community Choice Aggregation (CCA), also known as municipal aggregation, are programs that allow local governments to procure power on behalf of their residents, businesses, and municipal accounts from an alternative supplier while still receiving transmission and distribution service from their existing utility (EPA).

Individuals may benefit from the following schemes:


Revolving Loan Funds are public funds that are evergreen in the sense that the repaid principal and interest from loans made are re-issued to other loan recipients. In this way, the program funding “revolves” over time.


On-Bill Financing / On-Bill Repayment: On-Bill Repayment (OBR) and On-Bill Financing (OBF) are mechanisms for financing residential and small commercial clean energy technologies in buildings. Financing can come from the utility (OBF), or through a private entity to be repaid through the utility bill (OBR).


Residential Property Assessed Clean Energy (R-PACE) is a financing mechanism used by local governments that allows residential property owners to finance energy efficiency and renewable energy improvements through their property tax payment.

The following policy options concern corporations:


Third-Party Financing attempts to address affordability by allowing a system to be purchased by a third-party with the generation sold or leased over time to the customer-offsetting the power purchased from a utility.


A Power-Purchase Agreement (PPA) is a contract between a consumer and a renewable energy company that allows the company to own and maintain an installation and sell the electricity generated at a fixed rate.


Contracts for Difference (CfDs) are instruments that can be used to fix prices received by low carbon generation, increasing investor confidence and certainty they need to invest in low-carbon electricity generation.


Carbon Take-Back Obligations (CTBO), by which energy suppliers commit to sequestering an increasing fraction of emissions, may incentivize the use of CCS technology at scale.


Solar leasing is when a solar company owns the panels but charges others a fee to use them.