The world faces an escalating energy dilemma known as the “energy trilemma.” Its three sides are: sustainability (clean energy), accessibility (energy security), and affordability (equity). Achieving a balance among these three objectives is extremely difficult even under the best circumstances, but it becomes far more complex on the global level given the huge diversity in energy systems, constraints, and contexts across regions and countries around the world.

This is a global issue that concerns Europe as much as it does sub-Saharan Africa. Some countries are rich in cheap and abundant fossil fuels but struggle to achieve carbon reduction targets. On the other hand, other countries possess extensive clean energy systems but face crises related to citizens’ ability to afford costs. Reaching a comprehensive solution to this global dilemma requires unprecedented international cooperation, in addition to exceptional sensitivity to regional differences in energy realities, opportunities, and challenges.

To contribute to addressing this dilemma at the level of international policies and programs, the World Economic Forum’s Global Future Council on the Future of Energy Technologies is working on building a framework to understand the fundamental factors and stakeholders necessary to provide an enabling environment for a safer, fairer, and more sustainable energy future. And as part of this project, the initiative identified three main factors that lie at the core of the complexities of energy systems, and must be “understood and addressed together for innovation to succeed”:

- Dependence on physical ecosystems (that is, energy demand, supplies, transmission and distribution networks)

- Political, geopolitical, and regulatory challenges (at both national and international levels, including commitments and obligations)

- High risk levels with strong aversion to risk

Physical dependencies represent a major obstacle to innovation in both rich and poor countries alike. In the United States, for example, a lack of grid connections and transmission infrastructure has led to years-long delays for new solar power plants to enter service. In Africa, leaders face a historic challenge represented in “leapfrogging” directly to large-scale clean energy projects at the utility level, bypassing traditional electrification phases, in order to provide electricity to 600 million Africans who still live without it.

As for political and regulatory challenges, they are global in scope and complex even at smaller local levels. Leaders have to deal with local realities and their needs, global supply chains, and compliance with laws and commitments entrenched at multiple and overlapping levels — and often contradictory. Journalists have reported for years that a “maze of bureaucracy” hinders new energy projects from the United States to the European Union. One prominent example is the TransWest Express project in the United States, which took 18 years to obtain approval due to overlapping federal and state bureaucratic obstacles, and is still not expected to enter service before 2030.

And finally, our world’s excessive dependence on energy imposes the highest priority on short-term energy security, even if that comes at the expense of future generations’ ability to enjoy the same necessities and comforts that depend on electricity. Time and again, countries choose immediate grid stability at the expense of decarbonization and long-term stability. What alternative do they have?

According to the World Economic Forum report:

“There is no appetite for taking on operational risk in this sector; this is reflected in most regulations and certainly represents a barrier to innovation. The sector has traditionally been one of the slowest adopters of new technologies.”

But to overcome the paralysis imposed by this “decision tree” that consistently sidelines the future, innovation becomes imperative. Despite Malthusian fears of resource depletion and rising demand, technology and innovations have previously succeeded in overcoming scarcity expectations — and they can do so again.

And although the energy sector is by nature slow to adapt, artificial intelligence is reshaping global energy systems at present. And although its integration represents a major threat to energy systems in the short term due to heavy consumption, experts confirm that it will soon contribute to offsetting its consumption by making the entire world more efficient in energy use.

And the Forum’s report concludes by saying:

“There is a need for new solutions to manage risk, address the energy trilemma, and modernize the system. However, success depends on creating a tailored energy innovation ecosystem that recognizes these unique complexities and operates according to its own rules.”

The European Central Bank (ECB) announced its interest rate decision on Thursday at the conclusion of its September 10–11 meeting, leaving rates unchanged at 2.15% — the lowest level since October 2022 — in line with most global market expectations, marking a second consecutive hold.

Policymakers at the ECB believe there is no need for further rate cuts to achieve the 2% inflation target, despite new economic projections pointing to a decline in interest rates over the next two years.

This statement is considered “positive” for the euro.

US stock indexes climbed to fresh record highs on Thursday after the release of key inflation data, which, despite showing an increase, did not deter investors from expecting the Federal Reserve to cut rates this month.

Government data released in the United States today showed the consumer price index (CPI) rising by 0.4% in August, above forecasts of 0.3%. The annual reading came in at 2.9%, in line with expectations.

Excluding volatile items such as food and energy, core CPI rose by 0.3% month-on-month and 3.1% year-on-year, both consistent with forecasts.

This followed producer price index (PPI) data showing an unexpected 0.1% decline and a 2.6% year-on-year increase.

Additional data revealed that weekly jobless claims jumped by 27,000 last week to 263,000, exceeding expectations of 235,000.

Despite this data, market expectations remain that the Federal Reserve will cut interest rates by 25 basis points at its September 17 meeting, according to the CME FedWatch tool, while traders slightly raised bets on a larger 50-basis-point cut.

In trading, by 16:38 GMT, the Dow Jones Industrial Average jumped 1.3% (573 points) to 46,064. The broader S&P 500 index gained 0.8% (50 points) to 6,582, while the Nasdaq Composite rose 0.7% (148 points) to 22,034.

Nickel prices fell on Thursday despite a weaker US dollar against most major currencies, as bets on Federal Reserve interest rate cuts continued. The Russia-Ukraine war also weighed on metals markets, with Russia being one of the world’s largest producers of industrial metals.

The administration of US President Donald Trump is pressuring Russia by tightening economic sanctions in an effort to reach a ceasefire agreement in Ukraine.

Meanwhile, the dollar index fell 0.3% to 97.5 points by 16:19 GMT, after reaching a high of 98.09 and a low of 97.4.

Economic data came in mixed. The US consumer price index (CPI) for August rose 0.4% month-on-month, above forecasts of 0.3%, according to the Bureau of Labor Statistics. The annual rate was 2.9%, in line with economists’ expectations.

Core CPI, which excludes volatile food and energy prices, rose 0.3% on a monthly basis and 3.1% annually, both matching Dow Jones forecasts.

This report followed Wednesday’s producer price index (PPI) data, which showed an unexpected 0.1% monthly decline, while the annual rate was up 2.6%.

In other data on Thursday, weekly jobless claims posted a surprise jump, rising by 27,000 to 263,000 in the week ending September 6 after seasonal adjustments. That exceeded forecasts of 235,000.

Despite this data, traders still expect the Federal Reserve to cut rates by 25 basis points at its September 17 meeting, according to the CME FedWatch tool, while slightly increasing bets on a larger 50-basis-point cut.

In trading, spot nickel contracts fell 0.4% to $15,003 per ton as of 16:29 GMT.