Bain & Company Energy Agenda 2025: New Challenges, New Innovations – Report Insights

The Bain & Company Energy Executive Agenda 2025 highlights a growing skepticism among energy and natural resources (ENR) executives regarding the timeline for achieving global net-zero emissions, despite record investments in clean energy. The report based on a survey of over 700 executives, reveals that the initial enthusiasm for the energy transition is being tempered by a non-virtuous cycle of ROI, where rising capital costs, tighter budgets and customer reluctance to pay premiums are forcing companies to delay or rethink their transition-oriented growth businesses. This shifting focus is pushing leaders to concentrate on core business efficiency, accelerating digital transformation especially with AI and ERP upgrades to manage costs and meet surging electricity demand, particularly from data centers. Let’s look at some key insights from this report.

Key Insights 

• Net-Zero Timeline Delay: Nearly half of ENR executives (44%) now expect the world to reach net-zero emissions by 2070 or later, a significant jump from 31% who held this view in 2024.
• 2050 Goal Pessimism: Only 32% of executives still expect net-zero by 2050, a sharp decline from the 40% to 50% share in previous years.
• Rising Project Costs: More than three-quarters (75%+) of executives reported that their capital project costs rose at least somewhat over the past 12 months.
• Extreme Cost Inflation: One in 10 executives experienced extreme capital project cost increases surpassing 20%.
• Customer/Shareholder Roadblocks: The top obstacle for scaling transition-oriented businesses is finding enough customers willing to pay higher prices to create sufficient ROI.
• Shareholder Support Drop: There was a notable shift in shareholder support, with a greater portion of executives pointing to a lack of shareholder support as a major issue this year (up from 49% in a prior period, and with skepticism now at 68% per one source).
• AI/Digital Optimism: Enthusiasm for AI and digital tools is surging, with 72% of executives feeling positively about the 5-to-10-year business case for these technologies.
• ERP Overhauls: More than 60% of executives anticipate their next ERP system transformation will take place within the next three years to modernize infrastructure and integrate AI.
• AI Electricity Demand: Data centers’ annual global energy consumption is estimated to more than double by 2027, potentially consuming 2.6% of global power and requiring over $2 trillion in new energy generation resources.
• Utilities’ Demand Response: The top three solutions cited by utilities to meet increased demand from AI/data centers are investing in more renewables, prolonging the lifespan of existing assets, and adding natural gas assets.
• Positive Emerging Tech Outlook: Executives feel more positive about the business cases for:
  • Energy Storage (47% positive outlook)
  • Renewables (45% positive outlook)
  • Carbon Capture, Utilization, and Storage (CCUS) (43% positive outlook)
  • Circularity (39% positive outlook)
• Project Execution Technology: Nearly half (48%) of executives plan to deploy technologies, including AI, to improve project execution and outcomes.
• Energy Security vs. Affordability: Countries are prioritizing energy security and affordability, with some leaning towards renewables and efficiency while others focus more on ensuring ample supplies of traditional fuels.

Conclusion

The 2025 energy agenda is defined by a necessary pivot from idealistic net-zero pledges to a more pragmatic focus on financial viability and operational efficiency amidst escalating costs and demand. The industry faces the dual challenge of supplying ever-increasing volumes of energy, driven by new load demand from AI and data centers, while simultaneously pursuing decarbonization goals whose timelines are slipping. Success in this complex environment will depend on a reset of capital projects making them faster, smarter and leaner through digital transformation and AI and the ability to deliver robust returns on transition-related investments. Executives must focus on core business strengths, leverage technology to unlock efficiency and growth and use scenarios to plan for an inherently uncertain and fractured energy future.

You can read the report here.