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Climate-vulnerable nations outpace US in solar uptake amid fossil fuel shocks - The New Indian Express

As geopolitical tensions triggered by US-Israel strikes on Iran send global oil prices surging, the world’s most climate-vulnerable economies are facing yet another fossil fuel shock. But even as their import bills swell, a new analysis shows that many of these countries are already quietly leapfrogging richer nations in the shift to clean energy.

A report released earlier this week by global energy think tank Ember, in partnership with the Climate Vulnerable Forum and V20 (CVF-V20), finds that 46% of climate-vulnerable countries have already surpassed the United States in solar power penetration, measured against electricity demand. More than half have also overtaken the US in economy-wide electrification, signalling a structural shift in global energy adoption patterns.

The CVF-V20 bloc, comprising 74 countries across Africa, Asia, Latin America and small island states, represents 1.7 billion people, over one-fifth of the global population but less than 5% of global GDP and electricity demand. Yet, these nations are increasingly emerging as frontrunners in de-centralised solar adoption and electric technologies.

The report highlights that the clean energy transition in these economies is significantly undercounted. In eight out of ten CVF countries, solar panel imports since 2017 are at least three times higher than officially recorded installed capacity, indicating a rapid expansion of decentralised rooftop and off-grid systems.

This trend is visible across sectors. Countries such as Namibia (35%) and Togo (18%) lead in solar generation share, while Nepal (70%) and Sri Lanka (64%) have among the highest electric vehicle adoption rates. Battery uptake is also rising sharply in countries like Jordan and Kyrgyzstan.

The shift is being driven by a dramatic fall in technology costs. Prices of solar panels, batteries and electric end-use technologies have declined by 30% to 95% over the past decade, fundamentally altering the economics of energy in developing markets. “Solar is now cheaper to build than fossil power, and off-grid systems can outperform grid expansion in remote areas,” the report notes, adding that decentralised systems are proving especially effective in regions where extending traditional grid infrastructure is costly or unviable.

Despite this progress, fossil fuel dependence continues to impose severe macroeconomic strain. CVF-V20 countries collectively spent $155 billion on net fossil fuel imports in 2024, draining public finances and foreign exchange reserves.

In at least 19 countries, fossil imports account for over half of the trade deficit, including 79% in Morocco, 67% in Pakistan, and 59% in Bangladesh. The current geopolitical crisis threatens to exacerbate this vulnerability. If oil prices average $100 per barrel through 2026, the group’s import bill could rise by more than $30 billion.

The exposure is particularly telling given that around 500 million people in these countries still lack access to electricity, while another 500 million face unreliable supply. For many, this means continued reliance on biomass, which is both inefficient and linked to serious health risks.

What makes the current transition notable is that clean energy is no longer a costlier alternative. A decade ago, solar projects could require up to five times more upfront investment than fossil fuel plants. Today, that equation has reversed.

The report shows that solar power is now competitive with fossil fuels on upfront capital costs, while also eliminating ongoing fuel expenses. Financing costs for solar have also fallen below those for fossil fuels in several emerging markets, including Morocco and Vietnam.

At the same time, falling battery prices are solving the “last-mile” problem. As noted in the report’s analysis, solar-plus-storage systems are now cheaper than grid extension for communities located even a few dozen kilometres from existing networks. The implications go beyond energy. Expanding electrification can unlock productivity gains across sectors from healthcare and education to manufacturing, while reducing exposure to volatile global fuel markets. Importantly, many of these countries have not yet locked into large-scale fossil infrastructure. This leaves open what the report describes as an “electric fast-track”, a development pathway that bypasses decades of fossil fuel dependence.