Key Points
Introduction: The Global Renewable Energy Imperative
Energy Security and renewable energy stands as the most critical solution to global climate
challenges, economic development. The urgent imperative for transforming global energy
systems has never been more apparent. According to the UAE Consensus, the world must
triple renewable energy capacity and double energy efficiency by 2030 (IRENA 2024). This
addition is important because energy efficiency represents the “first fuel” in the clean energy
transition – often providing the most cost-effective way to reduce emissions while delivering
multiple benefits across the economy.
The current global energy landscape reveals a complex intersection of environmental,
economic, and social challenges. Developed economies, particularly G7 nations, bear a
disproportionate responsibility for driving this transformative energy transition. The
economic potential is substantial – clean energy investments could generate 30 million jobs
globally by 2030, representing a profound opportunity for sustainable economic
restructuring.
Critical challenges demand immediate and coordinated international action. Financing
limitations remain the most significant barrier to rapid renewable energy deployment,
particularly in developing economies (Fasesin et al. 2024). Technology transfer mechanisms
are fragmented, and global investment remains uneven (McDonald and Vaughan 2023).
This policy brief proposes a comprehensive strategy for addressing these challenges
through:
The global energy landscape is experiencing a fundamental transformation driven by urgent
climate imperatives, technological innovations, and shifting economic paradigms.
Sustainable Development Goal 7 (SDG7) represents a holistic vision of energy access that
extends far beyond traditional environmental considerations. This goal interconnects with
broader development objectives, touching critical aspects of economic growth, social equity,
and global security.
Renewable energy offers a multifaceted solution to these complex challenges. Beyond
carbon reduction, it presents unprecedented opportunities for economic diversification,
technological innovation, and social development. Developing nations can leverage
renewable technologies to address energy poverty while simultaneously pursuing
sustainable economic growth. The World Bank consistently emphasizes that reliable,
affordable energy is a fundamental driver of economic development and poverty reduction
(World Bank 2022).
Technological innovations in renewable energy are accelerating progress toward critical
tipping points that can drive systemic change. Breakthroughs in solar photovoltaics, wind
energy, energy storage, and smart grids have not only reduced costs and enhanced
efficiency but are also rapidly reshaping economic ecosystems. As these technologies scale,
they trigger self-reinforcing adoption cycles that challenge traditional energy paradigms.
Countries that strategically invest in and support this transition are more likely to gain a
competitive edge in the emerging green economy.
International collaboration emerges as a critical mechanism for achieving equitable and
effective energy transitions. This requires a comprehensive approach that addresses
technological, financial, and regulatory barriers. The complexity of global energy
transformation demands a holistic strategy that considers technological innovation,
economic feasibility, and social implications.
The role of G7 nations is particularly crucial. These economies possess the technological
capabilities, financial resources, and global influence to drive meaningful change. By creating
supportive policy frameworks, investing in research and development, and establishing
innovative financing mechanisms, G7 nations can catalyze a global renewable energy
revolution. The G7 should act as a platform for collaboration with the Global South to
promote shared global prosperity. This transformation should be inclusive, ensuring active
participation from developing countries, rather than being led solely by G7 nations. The
renewable energy landscape presents a complex geopolitical and economic dynamics that
directly affect global energy security. While G7 nations have significant potential to lead the
global renewable energy transition, the production of key components such as solar panels
and wind turbines remains concentrated in China, creating supply chain dependencies and
vulnerabilities (Tagotra 2022). Geopolitical tensions or trade disputes could further disrupt
access to these critical technologies.
Notably, China’s innovation and economies of scale have played a pivotal role in advancing
renewable energy globally, alongside Germany. To maximize their impact, G7 nations should
leverage their financial resources and influence by directing IGOs like the IMF and World Bank to support renewable energy deployment through initiatives such as the Climate Economic Transition Program (CETP) (Tabrizi et al. 2025). The WTO can also facilitate trade rules that encourage renewable energy development.
While current U.S. climate policy positions present challenges to multilateral cooperation, G7
nations should emphasize how renewable energy advances energy security and economic
competitiveness—areas of bipartisan interest in the United States (Shah 2025). Building broad
support through these shared priorities will strengthen G7 influence in global energy
transition efforts.
Current Progress and Barriers in Renewable Energy Development
Despite a significant rise in global electricity access from 75% in 2000 to 90% in 2020, energy
poverty remains a major issue, affecting 1.18 billion people who lack reliable, affordable, or
functional electricity. This number is 60% higher than the 685 million officially reported as
without electricity (IEA 2024). Sub-Saharan Africa faces the most severe challenges, with
many households unable to afford reliable energy services despite the region’s abundant
resources (Wang et al. 2023).
Case Study: Solar Home Systems in Rwanda: Rwanda has demonstrated significant success
with its decentralized solar home system program, which provided affordable electricity to
over 370,000 households in remote areas within five years (Rwanda Energy Group 2024).
This program combined microfinance options with public-private partnerships, creating
local jobs while significantly reducing energy poverty. The initiative also stimulated local
entrepreneurship through phone-charging micro-businesses that generated sustainable
income for rural communities.
Many electrified areas still experience power outages, equipment failures, and unaffordable
costs, preventing meaningful usage. Using satellite imagery, researchers analyzed nighttime
light data to identify energy-poor settlements, revealing stark disparities, especially in Sub-
Saharan Africa. Their findings suggest that local solutions, rather than large-scale
infrastructure, could significantly reduce energy poverty. The data, available through the
High Resolution Electricity Access (HREA) project, aims to guide policies for achieving
Sustainable Development Goal 7—ensuring affordable, reliable, and sustainable energy for all
by 2030 (Min et al. 2024).
Global renewable energy capacity has witnessed significant growth, yet substantial
challenges remain. In 2022, renewable energy sources contributed approximately 29% of
global electricity generation (Selin and Eckley 2025), representing a promising but
insufficient progression towards comprehensive decarbonization. The trajectory of
renewable energy deployment reveals a complex landscape of achievements and persistent
obstacles.
Technological advancements have dramatically transformed the renewable energy sector.
Solar and wind energy costs have decreased by 82% and 39% respectively since 2010 (International Renewable Energy Agency 2022), making these technologies increasingly
competitive with fossil fuel alternatives. According to the latest reports, global clean energy
investment reached a record $2.1 trillion in 2024, driven by electrified transport, renewable
energy, and power grids (Catsaros 2025). The International Energy Agency (IEA) also
highlights that investment in clean energy has accelerated, with spending on renewable
power, grids, and storage now higher than total spending on oil, gas, and coal (IEA 2024).
Financing remains a critical challenge, particularly for developing economies. Traditional
financial mechanisms are inadequately structured to support large-scale renewable energy
infrastructure. Developing countries face multiple barriers, including:
● Limited access to long-term, low-cost capital
● Higher perceived investment risks
● Insufficient financial and technical expertise
● Weak regulatory frameworks
● Inefficient grid infrastructure
Technological constraints continue to challenge comprehensive renewable energy
deployment. Energy intermittency and storage limitations represent significant technical
barriers. While battery storage technologies are advancing rapidly and its costs have declined
by 90% in less than 15 years (International Energy Agency 2024), they have not yet reached
the level of reliability and cost-effectiveness required for complete grid transformation.
Supply chain complexities further complicate global renewable energy expansion.
Geopolitical tensions, pandemic-related disruptions, and economic uncertainties have
created significant challenges in technology procurement, manufacturing, and deployment.
The concentration of critical renewable energy supply chains in limited geographic regions
presents potential strategic vulnerabilities.
Regulatory environments for renewable energy remain fragmented and often inconsistent.
Different jurisdictions adopt varying policy mechanisms such as feed-in tariffs, tax
incentives, or renewable portfolio standards, creating uncertainty for investors and
technology developers. The absence of harmonized international frameworks for industry
support — including standards for grid integration, certification processes, and financial
incentives — significantly impedes global renewable energy deployment. Aligning these
approaches could enhance investor confidence and accelerate renewable energy growth.
G7’s Role in Driving Green Energy Innovations and Trade
Building on the G7’s historic commitment to tripling global renewable capacity by 2030 (as
established at the Hiroshima Summit), this brief proposes enhancing and expanding existing
G7 frameworks rather than creating entirely new structures. The 3X commitment provides a
solid foundation, but requires implementation mechanisms that address financial, technical,
and regulatory barriers.
The G7 historically served as a platform for coordinating environmental policies among
leading economies, though with varying commitment levels and limited binding
agreements. Performance has been mixed—while the G7 has helped advance dialogues on
green technologies and sustainable trade frameworks, implementation has often fallen short
of announced ambitions, with progress undermined by competing national economic
priorities and inconsistent follow-through on funding pledges.
While political shifts in some countries have created policy uncertainties, renewable energy
presents multiple points of bipartisan alignment including energy security, economic
competitiveness, and technological leadership. By framing renewable energy policies around
these shared priorities, G7 initiatives can maintain momentum despite changing political
landscapes. G7 nations can be transformative catalysts in global renewable energy
transitions through strategic investments, policy innovations, and international collaboration.
Renewable energy development serves G7 nations’ direct self-interests through:
Technology leadership emerges as a critical domain for G7 intervention. Investments in
next-generation technologies like green hydrogen, advanced solar technologies, and gridscale
energy storage can accelerate global renewable energy transformation. The potential
for breakthrough innovations is substantial, with emerging technologies promising higher
efficiency, lower costs, and improved energy storage capabilities.
Financial mechanisms represent another crucial area of intervention. G7 nations can develop
innovative financing instruments that support energy transitions in developing economies.
This includes:
Trade policy reform offers another significant avenue for intervention. Even amid trade
tensions, renewable energy presents an opportunity for cooperative frameworks that benefit
all parties. For instance, Canada-U.S. trade in renewable components could be designated as
a strategic priority exempt from broader tariff disputes, creating a model for sustainable trade
relationships.
Public-private partnerships emerge as a powerful mechanism for driving green energy
investments. By creating collaborative platforms that bring together governments, private
sector entities, research institutions, and international organizations, G7 nations can create
comprehensive ecosystems of innovation and deployment.
Policy Recommendations
Each policy recommendation below enhances existing G7 frameworks while addressing
both global needs and G7 nations’ self-interests. These recommendations could be
advanced through the existing G7 Climate and Energy Ministers’ Meeting or incubated at the
G7 before broader introduction at the G20 level.
Establishing a coordinated G7 renewable energy research fund represents a critical strategy
for accelerating global energy transformation. The proposed fund would prioritize
breakthrough technologies that have transformative potential for addressing complex
energy challenges. This investment will drive economic growth through creating high-skilled
jobs in renewable tech sectors while establishing new sustainable trade ecosystems.
Implementation step: G7 nations should commit 0.1% of GDP to clean energy R&D by 2026,
with research priorities determined through annual coordination meetings and funding
disbursed through a dedicated secretariat.
Energy storage technologies emerge as a particularly crucial area of focus, given the
intermittent nature of renewable energy sources. Advanced battery technologies, including
solid-state batteries and novel chemical compositions, could dramatically improve energy
storage capacity and reliability.
Smart grid management systems represent another pivotal research domain. These
sophisticated technological platforms would leverage artificial intelligence and advanced
computational models to optimize energy distribution, predict demand fluctuations, and
integrate renewable energy sources more effectively into existing electrical infrastructure.
Smart grid advancements will facilitate cross-border power trading, creating new market
opportunities that align with SDG7’s vision of sustainable energy access while promoting
regional economic integration.
Next-generation renewable technologies require sustained, strategic investment to
overcome current technological limitations. These investments create new industrial sectors
and export opportunities, particularly benefiting countries that develop early technology
leadership, thereby driving green economic growth through innovation-based competitive advantage. Emerging technologies like advanced photovoltaic materials, offshore wind innovations, and green hydrogen production methods represent frontier areas with significant potential. Research should focus on increasing energy conversion efficiency, reducing manufacturing costs, and improving overall system performance.
Artificial Intelligence for energy optimization presents a revolutionary approach to
renewable energy management. AI integration into energy systems creates new service
export opportunities and promotes sustainable trade in digital solutions that optimize
resource use—a perfect embodiment of SDG7’s goal to increase renewable energy efficiency
while stimulating economic growth. Machine learning algorithms can enhance predictive
maintenance, optimize energy generation and distribution, and create more responsive and
adaptive energy ecosystems. By integrating AI technologies, renewable energy systems can
become more intelligent, efficient, and responsive to dynamic energy demands. Smarter grid
management will reduce the need for energy storage systems by enabling optimal
integration of variable renewables with flexible generation.
Case Study: Denmark’s AI-Powered Wind Energy Management: Denmark has successfully
implemented AI algorithms that predict wind patterns and optimize turbine operations,
increasing energy output while reducing maintenance costs (Marcher Hansen, 2023). This
system combines weather data, turbine performance metrics, and grid demand patterns to
create a responsive energy system that maximizes renewable energy utilization.
The discourse on renewable energy development often focuses on the electricity sector,
overlooking the combustion sector from transportation and industry. Creating sustainable
biofuel supply chains offers significant trade opportunities between agricultural economies
and industrial nations, fostering green growth through circular economic principles. While
electrification is a key energy efficiency strategy, its adoption in developing economies may
face slower progress due to infrastructure and economic constraints. To address this gap,
research into 100% bio-hydrocarbon fuels, such as bioethanol derived from agricultural
waste or biodiesel produced through hydrotreating vegetable oils, should be accelerated.
These biofuels offer a viable pathway to decarbonize sectors and regions where widespread
electrification faces significant hurdles, ensuring a more comprehensive transition to
sustainable energy systems.
2. Facilitating equitable energy financing mechanisms
Developing comprehensive financial strategies is essential for supporting renewable energy
transitions in developing economies. Green financing directly addresses SDG7’s affordability
and accessibility goals while creating new financial service export opportunities for G7
economies. Green credit lines with preferential terms can provide critical financial support,
offering lower interest rates and more flexible repayment structures specifically designed for
renewable energy infrastructure projects. These financial instruments would help overcome
traditional investment barriers faced by emerging economies.
Implementation step: Create a G7-backed guarantee mechanism that reduces investment
risk premiums by 50% for renewable projects in developing nations, mobilizing an estimated
$300 billion in private capital by 2030.
Risk-sharing instruments represent an innovative approach to mitigating investment
uncertainties. These mechanisms help operationalize SDG7 by mobilizing private capital into
renewable energy markets, particularly in developing economies, stimulating both domestic
green growth and international investment flows. By creating multilateral guarantee
mechanisms, international financial institutions can provide confidence to private investors
considering renewable energy projects in developing regions. These instruments would
distribute potential financial risks among multiple stakeholders, making renewable energy
investments more attractive and feasible.
Additionally, equitable carbon trading is essential to channel financial flows from wealthier
economies to developing ones, supporting their renewable energy transitions. Carbon
markets create tradable commodities from emissions reductions, establishing new financial
instruments that directly connect SDG7 implementation with economic growth
opportunities. International or regional carbon markets should be established with mutually
recognized standards, aligned with the Paris Agreement’s Article 6. Integrating wealthier
countries into these markets will drive demand and price, scaling up global climate action
and accelerating emissions reductions.
3. Creating a global renewable energy trade framework
Eliminating tariffs on renewable energy technologies represents a critical first step in
creating a supportive international trade environment. This directly implements SDG7’s
access and affordability goals through trade policy while stimulating global economic
growth in sustainable technology sectors. By removing financial barriers to technology
transfer, G7 nations can accelerate global renewable energy adoption. Standardized tariff
reductions would create a more accessible and competitive global market for renewable
energy technologies.
Implementation step: Establish a G7 agreement to eliminate tariffs on an agreed list of
climate-critical technologies by 2027, with designated critical supply chains receiving
expedited customs processing regardless of broader trade tensions.
Standardizing technical regulations is essential for facilitating smoother international
technology transfers. Harmonized standards accelerate technology diffusion required for
SDG7 implementation while reducing trade barriers that restrict green economic growth
opportunities. Developing harmonized technical standards would reduce compliance
complexities, lower certification costs, and create a more predictable regulatory
environment for renewable energy technology manufacturers and investors. These
standardized frameworks would promote technological innovation and international
collaboration.
Case Study: EU-Africa Renewable Energy Cooperation Platform: By 2030, the Africa-EU
Green Energy Initiative (EU 2023) aims to provide electricity access to at least 100 million
people (European Commission n.d.). Through Team Europe, €3.4 billion in EU grants will
support renewable energy, energy efficiency, a just transition, and the greening of local
value chains. As part of this initiative, €400 million has been mobilized for clean cooking activities, combining contributions from EU countries, implementing agencies, and public
development banks, along with €150 million from EU funds (EC n.d.).
Regional energy cooperation platforms can create strategic mechanisms for technology
sharing and collaborative infrastructure development. These platforms enable cross-border
renewable energy trading and shared infrastructure investments that directly address SDG7’s
clean energy access goals while creating new regional economic opportunities. These
platforms would facilitate knowledge exchange, joint research initiatives, and coordinated
infrastructure planning. By promoting regional integration, countries can develop more
robust and interconnected renewable energy ecosystems.
4. Capacity-Building and knowledge transfer initiatives
International training programs are essential for building technical expertise in renewable
energy technologies. Creating skilled renewable energy workforces globally expands
markets for sustainable technologies while enabling SDG7’s implementation through human
capital development. These comprehensive programs would provide specialized education,
hands-on training, and professional development opportunities for energy professionals
from developing economies. By investing in human capital, G7 nations can support longterm
sustainable energy transitions.
Implementation step: Establish a G7-funded scholarship program providing advanced
technical training for 10,000 renewable energy professionals from developing nations
annually, with graduates forming a global knowledge network.
Technology-sharing platforms can create dynamic ecosystems for collaborative innovation.
These platforms foster SDG7 implementation through democratized knowledge access while
creating new service-based trade opportunities in the digital green economy. These digital
and physical platforms would facilitate knowledge exchange, collaborative research, and
technology demonstrations. By creating accessible and interactive spaces for global energy
professionals, these platforms can accelerate technological learning and innovation.
5. AI-driven energy transition & digitalization
AI integration in renewable energy systems represents a transformative opportunity that
combines technological innovation with practical implementation strategies. The following
framework outlines how G7 nations can systematically implement AI solutions in renewable
energy:
Artificial Intelligence (AI) is revolutionizing energy storage, a critical yet often overlooked
factor in the transition to renewable energy. While global renewable capacity surged by 50%
in 2023, effective energy storage is essential to ensuring reliability, affordability, and
accessibility. AI-driven solutions can optimize existing energy grids, improve grid stability,
and enhance energy efficiency by dynamically managing supply and demand. AI-powered
microgrids also provide decentralized energy access in remote areas, benefiting
communities and essential services like healthcare.
Implementation steps for AI integration in renewable energy:
Additionally, AI-integrated storage systems can boost resilience against extreme weather
events. However, innovation in this field requires supportive policies, data security measures,
and cross-sector collaboration. Governments and industries must create frameworks that
foster AI-driven advancements while addressing socio-economic barriers to equitable
energy access (Meddeb 2024).
Conclusion: Advancing SDG7 and Green Economic Growth
The strategic importance of renewable energy extends beyond environmental
considerations to encompass critical geopolitical and economic dimensions. By advancing
the policy recommendations in this brief, G7 nations can simultaneously:
The path to a sustainable energy future requires an integrated, collaborative approach that
transcends traditional economic models. Technological innovation, progressive policy
frameworks, and genuine international cooperation can reshape the global energy
landscape. While geopolitical tensions with some countries present challenges, they also
emphasize the strategic importance of G7 nations developing diversified renewable energy
supply chains and technology leadership positions. Rather than competing directly with
China’s established manufacturing scale advantages, G7 nations can focus on nextgeneration
innovations in areas like advanced materials, AI integration, and systems
optimization where they maintain competitive advantages.
The next decade is critical. Coordinated action, substantial investments, and unwavering
commitment can accelerate the global transition to sustainable energy systems. G7 nations
must lead by example, demonstrating that economic prosperity and environmental
sustainability are complementary objectives.
Author Biographies
Lead Author
Syed Munir Khasru is a global thought leader with more than a decade of involvement in G7
and G20 communities. He has led around 25 policy briefs and co-chaired task forces for
both the G7 and the G20. An M.B.A. from the Wharton School of Business, University of
Pennsylvania, Syed founded and successfully built two world-class institutes in the global
knowledge industry: the international knowledge outfit the Institute for Policy, Advocacy,
and Governance (IPAG) and the international management consulting firm e.Gen
Consultants Ltd.
Under his leadership, IPAG has become a well-respected international knowledge outfit from
the developing Global South, addressing global challenges in key policy and strategy in areas
such as geopolitics and multilateral affairs, sustainable development and green growth,
climate change and energy transition, digital transformation and cybersecurity. His
innovative approach has seen leveraging a policy-focused knowledge outfit (IPAG) with a
project implementation wing (e.Gen), creating a unique synergy in the global knowledge
industry. Syed’s active engagement with international forums such as the G7 and the G20
and multidisciplinary expertise have enabled him to lead from the front in translating policies
into practices and strategies into impactful solutions on a global scale.
Co-Authors
Bambang Brodjonegoro is the former minister of finance and minister of research and
technology, Indonesia. He is the incoming dean of the Asian Development Bank Institute
and a professor of economics at the University of Indonesia.
Riad Meddeb is the director of the United Nations Development Programme’s (UNDP’s)
Sustainable Energy Hub, leading UNDP’s work on sustainable energy for development at
both policy and programmatic levels across 130 countries.
Hans Olav Ibrekk is Special Envoy for Climate and Security, Ministry of Foreign Affairs,
Norway.
Michael Weisberg is the deputy director of Perry World House and editor-in-chief of Biology
and Philosophy, and the Bess W. Heyman President’s Distinguished Professor and Chair of
Philosophy at the University of Pennsylvania.
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