Lessons from Davos: key forces shaping the energy transition
In an exclusive interview, Espen Mehlum, Head of Energy at World Economic Forum, speaks to Energy Connects on the key insights from Davos this year and the forces shaping the global energy transition. The discussion explores rising energy security concerns, the rapid growth of electricity demand, the dual role of AI as both a driver of consumption and a tool for system optimisation, and the latest findings from the World Economic Forum’s Energy Transition Index.
Tell us about the trends you see, especially those related to the energy transition that were discussed this year.
Davos 2026 was a melting pot of what’s really going on in the world. We had 3,000 leaders this year. From the energy side, there are maybe four things I could mention. First, the rise in the importance of energy security in a very uncertain global context, where energy infrastructure is vital but more exposed. There are questions around investments, and some of the infrastructure is ageing. So, the question of how to address energy security challenges in this new context was very front and centre. Discussions evolved around the need to diversify for both suppliers and users of energy, and to diversify the supply sources and the domestic energy mix in terms of the mineral components needed to feed all of this, as well as building new partnerships and trust. The second was around AI, which is very important in energy terms for understanding how to power this huge build-out of data centre capacity and how to get the speed and cost of power up quickly enough. And the other is about leveraging AI for the best of the energy system: how to use it to optimise energy consumption, reduce emissions, and make the energy system more secure.
The third was around this age of electricity. Electricity demand is growing three times as fast as overall energy demand. How can we build new capacity and the grids needed to power it? On the back of that, we also discussed things like clean fuels. Around 80% of global energy systems are covered by fuels. Only 2% of those are clean fuels. So, we see a huge potential to get the economics going.
Finally, it’s really the advent of the big emerging economies. India is one of them, as are China, Brazil, and others, and they are also reshaping the global energy systems and demand.
Energy for AI and AI for energy has become a dominant theme in the energy industry. How do you see the industry coping with the demand that the data centres are going to generate?
We are seeing a huge investment cycle in data centres. And of course, not all countries are equal. Electricity systems are also very different across countries. What is important to understand is that this comes on top of already fast-growing demand for electricity. So, the biggest source of demand growth is from cooling. The second is from the electrification of transportation and industry. And then AI is added on top — I think it’s a huge load in specific locations.
There is also the challenge of powering this through grid availability and by adding new sources of supply — a clean supply if you can, fast enough to power these data centres. There are some challenges here, but there are also solutions.
One solution could be for data centres to provide greater flexibility in the system, especially for those that are running training and models. The others that are running operations need very high reliability. The second is greater chip efficiency. And the third, I would say, is to new business models as well. Some of these data centre builders also bring new capacity and become a bit more independent from the grid.
Could you share the key findings from the World Economic Forum’s Energy Transition Index, particularly on how the Global South is progressing?
The Energy Transition Index is an annual report that we have been producing for 15 years. It holistically benchmarks the energy systems of 118 countries against 43 indicators covering what we call the energy triangle in terms of sustainability, equity, and security, as well as the enabling factors that can speed up or slow down transition.
What we have seen in the 2025 edition — the latest we have published — is progress globally. Many emerging economies, such as Brazil, India, China and others, are progressing. We are seeing, specifically in India, good progress in expanding energy access, for instance, by improving the economy’s energy intensity. We are also seeing challenges with enabling factors, such as infrastructure readiness and sufficient capital to build out all the infrastructure India needs.
You support a lot of innovation and deployment across the energy industry. What does it take to move from the pilot phase to large-scale deployments?
What we have seen in energy now is significant innovation and technological progress. Think of how far solar has come down the cost curve, or wind, or batteries, or electric vehicles, for instance. We see that innovation is coming both from within the energy system and from outside.
What AI has done — and can do — to energy systems really shows the bigger potential of innovation, which is about technological convergence. Where AI comes together with energy, materials, and innovation, we also see whole new business models emerging. That’s where real disruptive change can happen. But for this to scale, we need a couple of things. One, we need a policy that really enables this policy certainty and stability, and we need finance. We need to see investors coming in who believe in the market and in these new business models. And then we need to see demand. We need to see consumers, be it business consumers or private consumers, wanting these energy services. That’s a lot of potential in innovation. We’re only seeing the start.
