Accelerating the Energy Transition 2025

Framing the business and economic cases1 Bridging the gap between costs and returns requires mechanisms to translate societal benefits into financial incentives that attract investors. The energy transition is driven by a clear economic case that benefits society at large: secure and resilient access to energy, economic growth and job creation, improved health outcomes, upskilling and reskilling of the workforce and long-term competitiveness – in addition to decarbonization. However, realizing these benefits requires mechanisms that attract investments and distribute costs effectively. In market economies, the business case is a subset of the economic case, serving as a mechanism to mobilize private investment from different types of investors through incentives that make clean energy solutions and projects financially viable and bankable (see Figure 1). Companies assess investments based on factors such as favourable pricing structures, clear demand signals, accessible and affordable capital and a strong policy framework that aligns with market needs. Without these enablers, it becomes difficult to build a compelling business case and deploy the assets needed to operationalize the economic case. Different investors and companies have varying return requirements, risk tolerance and investment horizons. Unlocking more private capital requires offering attractive, risk-adjusted return opportunities tailored to diverse investor profiles. Accelerating the Energy Transition: Unpacking the Business and Economic Cases 5