China is the world's solar module powerhouse. Its domestic solar capacity additions this year will be more than double those of the US and EU combined, while its phenomenal cost advantage means it commands more than 80% of global module capacity. China’s current domination of solar module supply looks assured for the next decade or more.

The country’s colossal manufacturing base is key. Even as its costs continue to tumble, Chinese solar manufacturing could already comfortably supply more than twice the current global module demand of 350 GW. Meanwhile, in other markets, cost inflation drags on solar photovoltaic (PV) cell manufacturing. Critics point to direct Chinese government subsidies for domestic companies (as well as allegations of forced labour), but this isn’t the full story.

Falling interest rates, low energy costs, intense domestic price competition and government support for research and development also play their part. Equally as important has been indirect system-level support, with massive investments in transmission, energy storage, flexible capacity and manufacturing. Lower costs and lower curtailment of solar in China have kept its companies buoyant.

With Chinese solar module costs falling 42% between December 2022 and December 2023 alone to reach US$0.15/W, the ambitions of the US, Europe and others to compete look doomed. However, for those needing low-cost hardware to decarbonise, China’s solar module manufacturers are open for business.

The energy transition is creating new levels of demand for base metals and battery raw materials. The sharp upturn in demand as a result of climate policies and measures that are driving new low-carbon markets around the world has brought the potential bottlenecks of mineral extraction and refining capacity into sharp relief.

The lithium and cobalt value chains are concentrated in a handful of primary mineral suppliers and China, which dominates the processing capacity that exists today. The outlook for redressing these bottlenecks is beginning to look encouraging. While currently dominant suppliers and processors remain in a strong position, the diversification of both primary mineral supply and refining capacity is expected over the next decade.

Lithium and cobalt are compelling examples of the potential for a redistribution of the supply base. Thanks to price signals that are driving new investments and expanded capacity, the future value chains for base metals and battery raw materials will be both deeper and broader.

Over the next decade, carbon capture, utilisation and storage’s (CCUS) storage capacity will increase from 80 Mtpa to more than 500 Mtpa. Given previous false starts, scepticism lingers. However, support and regulation have changed the dynamic and injected significant momentum into the sector. The US’s Inflation Reduction Act (carrot) and the EU’s more recent Net Zero Industry Act (stick) continue to expedite CCUS activity.

While North America and Europe drive much of the CCUS growth, other regions, including the Middle East and Asia, will deliver material capacity over the coming decade. A diverse range of companies is leading developments in CCUS. However, the oil and gas sector is at the helm on many of these projects, given its complementary experience in sub-surface operations, managing volatile fluids at scale and working in offshore environments.

This scale of development does not come cheap, however, and to deliver the 2033 outlook, more than US$70 billion is set to be invested in transport and sequestration infrastructure before 2030. The next 10 years will be pivotal, and delivering projects at scale and accelerating growth will be key to the technology delivering to its potential.

The transformation of European heat and power production is a central facet of the region's climate and energy security strategies. Close to 10% of Europe's energy consumption is associated with heating and around one-third of that is supplied by natural gas.

There are notable shifts taking place in this segment of the European energy system, changes that give credence to the view that Europe is establishing new, lower-carbon forms of energy production and consumption. Driven by a combination of relatively high natural gas market price signals, strong climate policy goals and increased financial incentives in major markets like France, Europe's heat-pump sector is booming. Year-on-year growth has been in excess of 30%, while connections of air- and ground-source heat pumps are breaking records. In Finland, a country of 5.5 million, more than a million heat pumps are now installed.

More energy efficient and less emissions intense, this heat pump trend is a cornerstone of European residential and commercial climate action.