Dawning of the next era of energy

00:00 – 04:00 Noah Brener: This is Let’s Talk Energy, your go-to podcast for smart energy insights. I’m your host, Noah Brener. Each week we explore global energy markets through conversations with Rystad Energy experts and special guests. Today, we dust off the crystal ball and look decades into the future. Rystad Energy has just published its latest global energy scenarios — a comprehensive view of how the energy system and climate could evolve across different pathways, from rapid transition to slower shifts with longer fossil fuel reliance. The report, The Next Era of Energy, highlights rapid shifts already underway and which countries are moving fastest or slowest. This comes ahead of COP30 in Brazil, where nations will present updated climate pledges amid growing opposition to transition policies, especially in the U.S. So, what do these scenarios tell us about our energy future? What signposts should we watch? Which trends matter most for the global energy mix, and which countries are leading? And how long could this shift take? Joining me from Oslo are John Hansen, Head of Energy Systems, and Lars Nitter-Havro, Head of Energy Macro at Rystad Energy. John, Lars — welcome. Guests: Thanks for having us. Noah: Lars, let’s start with the report’s title: The Next Energy Era. Why that name, and what defines this era? Lars: We chose it for two reasons. First, the world has changed since last year — geopolitically, economically, and in policy. We’re entering a new period of turbulence. Second, we’re in a structural long-term shift toward electrification — from biomass, to coal, to oil and gas, and now toward electrons. Just as we didn’t completely stop using biomass or coal, we won’t stop using oil immediately — but electricity and clean electrons will increasingly power the global economy. 04:00 – 08:00 Noah: John, the energy transition narrative often focuses on climate, but your report highlights broader impacts. Tell us more. John: We're redefining the energy system’s role across reliability, affordability, sustainability — and now sovereign competitiveness. We describe this as an “energy pyramid”: reliable and affordable energy at the base, with climate at the top. Recently we've seen a shift — climate has moved down in the priority order as geopolitical realities have changed. That means understanding more pragmatic scenarios, not only highly ambitious ones. Noah: How is Rystad’s scenario work different from others, like IEA or Shell? John: Two key differences. First, granularity — our model builds from Rystad’s asset-level data: more than 300,000 assets across 217 countries, 70 energy carriers, 60 sectors. Second, we start with useful energy — the actual energy services society consumes — rather than primary energy. That matters because electrification is far more efficient. For example, moving from an internal combustion engine to an EV improves efficiency by ~70%. Useful energy demand grows, but primary energy peaks around 2035 in our 1.9°C scenario. 08:00 – 12:00 Noah: You mentioned new additions this year: the NDC-based scenario and the decarbonization index. Walk us through those. John: Our decarbonization index looks at three tasks: Clean and grow the power system Electrify end uses Clean residual emissions Today, 25% of useful energy globally comes from non-fossil sources. That means if we removed fossil energy today, we'd lose 75% of our energy services — highlighting the scale of the challenge. The NDC scenario tracks countries’ Paris Agreement pledges. Current pledges imply a 25% emissions reduction by 2035 — more ambitious than current performance, but far short of 1.5°C pathways, which require ~60% cuts. 12:00 – 16:00 Noah: What are the core scenarios? John: We present three: 1. Climate-First (1.6°C) Requires global coordination and rapid decarbonization — including deep reductions in hard-to-abate sectors. 2. Climate Pragmatism (1.9°C) Our “house view” — mixed progress, nonlinear transition, innovation in solar and EVs accelerating growth, but also geopolitical friction. Net zero ~2085. 3. Fossil-First (2.2°C) Slower transition, resilient fossil fuels, slower renewables in power sector. Net-zero after 2100. 16:00 – 20:00 Noah: The report suggests dystopian climate outcomes are less likely. Why? Lars: Despite political volatility — such as U.S. policy swings — long-term fundamentals still favor transition: slowing population growth, maturing global economies, and accelerating renewable cost competitiveness. Power sector emissions are ~40% of global emissions — and clean electricity is scaling rapidly. While not smooth, the trajectory reduces the likelihood of extreme warming scenarios. 20:00 – 24:00 Noah: Your decarbonization index shows surprising leaders — Nordic countries, Brazil, and others. Why? John: Historically, it reflects resource endowment, not just policy. Countries with abundant hydro (Nordics, Brazil) or nuclear (France) score highly. Strong electrification — like the Nordics’ limited gas use in buildings and industry — also matters. Lars: We categorize countries as pathfinders, scalers, and accelerators. Pathfinders like Norway pioneered EVs and charging. China scaled batteries and manufacturing. Now emerging economies — like Thailand — are accelerating fast. 24:00 – 28:00 Noah: Let’s discuss hard-to-abate sectors. Will they slow the transition? John: Yes — by 2050, in a pragmatic scenario, half of global emissions could come from sectors like steel, cement, aviation, and shipping. Biofuels help today, but future solutions include hydrogen, e-fuels, and CCS. Lars: Hydrogen is moving past hype — weaker players are clearing out, and experienced industrial developers are stepping in. CCS is also progressing, with more projects reaching FID and starting operations. 28:00 – 32:00 Noah: What do timelines look like, especially for fossil fuels? John: In our house forecast: Coal likely peaked already and declines, driven by power sector shifts. Oil & gas plateau in late 2030s but remain significant for aviation, shipping, petrochemicals, and grid stability. Gas competes with cheap renewables, but capacity scale-up speed is a key question. Transitions vary by fuel — coal falls fastest, oil & gas slower. 32:00 – End Noah: Gentlemen, thank you — and congratulations on the report. Guests: Thanks, Noah. Noah (recap): We're entering a new energy era defined by rising renewable investment and electrification. Transition leaders include both European countries and fast-evolving emerging economies. Rystad’s scenarios suggest we likely avoid the worst climate impacts, but net-zero by 2050 is increasingly difficult. Thanks for listening to Let’s Talk Energy. Follow us on social media, subscribe, and email us at podcast@rystadenergy.com