Are Paris goals achievable? How the energy transition measures up against climate targets

DNV’s Energy Transition Outlook 2025 reveals a huge gap between projected emissions and net-zero by 2050, with all regions falling short of their climate pledges. Even Europe, the frontrunner, gets close but misses net zero by 14 years. What will it really take to close the gap? We examine the case in Europe and find that bolder action would have significant positive ripple effects worldwide.

Lead authors: Onur Özgün and Anne Louise Koefoed

Contributors: Aasta Andreassen and Adrien Zambon

 

In this article, we compare climate targets against emission levels forecast in DNV’s Energy Transition Outlook 2025 (ETO 2025). We project Europe to be the first region to reach net zero and examine how it can close the gap to reach the target by 2050.  

Although Europe has just taken a small step backwards by allowing a greater percentage of emissions to be offset through international carbon credits (from 3% to 5%) to balance competitiveness with climate goals – long-term independence, security, and decarbonization still pull in the same direction. Europe continues to demonstrate global leadership through regulatory stability among 27 member states, and it is a trailblazer in its whole-system approach, mixing policy instruments that both support and mandate transformation and price carbon to discourage emissions. This comprehensive approach provides insights for other regions navigating the transition, and we show here why bolder steps would pay off for Europe and contribute to faster and cheaper transitions elsewhere. 

 

Factors helping and hindering Paris Agreement goals  

This year, countries are expected to submit more ambitious nationally determined contributions (NDCs) covering planned reductions from 2030 to 2035. However, climate diplomacy faces growing challenges, including geopolitical tensions that strain multilateral cooperation, rising tariffs that increase cleantech costs, and limited commercially viable decarbonization options in hard-to-decarbonize, trade-exposed sectors. Climate action is sidelined by other socioeconomic priorities, and NDC updates – critical for COP30 – have been slow and lacked sufficient ambition.  

By mid-October, only 62 countries (31% of global emissions) had submitted updates according to ClimateWatch. Major economies, like India and the EU have yet to submit their official NDCs. China submitted its NDC on 3 November, targeting a cautious 7-10% cut from peak emissions by 2035, but some sectoral and non-CO₂ gas reductions remain less developed, including policy details on coal phase-down. Meanwhile, the US exited the Agreement, rolled back federal climate policy, reduced international donor funding for climate, which all weaken global momentum at a critical time.  

On the other hand, climate action can gain impetus for its economic benefits: renewables are now cheaper than fossil fuels in new power generation, supporting wider electrification and transformation in several demand sectors; competition for new industrial growth is spurring economic benefits, innovation, and jobs; and energy security concerns, intensified by volatile fossil fuel prices, are accelerating a shift to domestic renewables – especially in import-dependent countries. Global policy is amplifying these trends. For example, the New Collective Quantified Goal on Climate Finance (NCQG), adopted at COP29, aims to triple climate finance to developing countries to USD 300 billion annually by 2035, although the financing model and flow of funds are to be worked out.  

Arguably, COP30 in Belém does not need comprehensive new government-negotiated outcomes given what is already agreed, such as COP28’s Global Stocktake outcome and clear implementation priorities for energy in paragraph 28 on mitigation. But COP negotiations remain crucial to drive global action toward a ‘well below 2°C’ world. The 2025 Nationally Determined Contributions Synthesis Report, covering one-third of global emissions, projects a 10% cut in greenhouse gas emissions (GHGs) from 2025 levels and 17% from 2019 levels by 2035 – bending the emissions curve but far short of the 60% reduction outlined by the IPCC in 2023. The UN Emissions Gap Report 2025 sees slight improvement but still warns of a 2.8°C rise based on current policies and 2.3-2.5°C if NDCs are implemented in full. DNV’s ETO 2025 projects a most likely 2.2°C increase by 2100 due to emissions overshoot, which is why deeper and speedier cuts are needed. NDCs remain vital tools to align energy investments with climate goals.  

 

How likely is it that regional climate targets will be achieved? 

At DNV, our ETO 2025 offers a deep dive into the energy trajectories of ten world regions, also using CO₂ emissions as a lens to track progress. The picture we paint is sobering: despite bold pledges and long-term climate ambitions communicated in the NDCs or long-term low emission development strategies (LT-LEDS), every region is falling short on emissions reductions. In 2024, global annual energy-related CO₂ emissions hit 35 gigatonnes (Gt), with an additional 3.4 Gt from industrial processes beyond fuel combustion. Fast forward to 2050, and we project a 43% drop, bringing total emissions down to just under 22 Gt – a significant decline, yet still far from the CO₂ cuts needed to meet climate targets (99% for 1.5°C and 73%, below 2019 levels, for well below 2°C in line with IPCC, 2023). 

Our ETO 2025 finds power generation leading CO₂ emission declines, followed by the transport sector (see Figure 1), which reflects the findings of the 2025 NDC Synthesis Report (Figure 17, p. 43). That report finds that most NDCs refer to mitigation measures in energy supply (80%), particularly solar and wind as priority areas, followed by transport (78%), particularly electric (light and heavy) vehicles, while fewer NDCs include mitigation measures in buildings (69%) and Industry (67%). 

 

Note: Decarbonizing energy and industry is key, with the energy sector accounting for about 75% of global greenhouse gas emissions and industrial process emissions adding another 6% (WRI, 2024). 

 

Figure 2 shows regional emission trajectories grouped by income level, recognizing and reflecting levels of and aspirations for development and industrialization. 

 

Decarbonization is happening, but far too slowly. Overall, emission reductions projected in the ETO 2025 are off track to meet goals set in NDCs and LT-LEDS across all regions, as shown in Figure 3 below. The Appendix table details the climate targets of ten world regions¹ and ETO 2025 covers their transitions in detail. Select regional findings on emission trajectories include: 

• Greater China: A modest NDC pledge of 7-10% reduction from peak levels confirms the direction in Chinese policies towards emissions control. China commonly under promises and overdelivers, enabled by its booming cleantech sector. However, on carbon neutrality by 2060, our analysis finds residual emissions, mostly from hard-to-decarbonize subsectors in manufacturing and transport (aviation and maritime).
• North America: Canada maintains net-zero goals for 2050. However, US policy shifts in 2025 extend fossil fuel use and limit green hydrogen and electric mobility, delaying decarbonization by five to eight years. Despite reduced support, solar and onshore wind expand as the cheapest sources of electricity. Nonetheless, emissions remain well above net zero by 2060.  
• In the Indian Subcontinent, where India is the dominant economy, energy addition is essential to meet increasing energy demand, and economics drive energy decisions. Falling renewable costs keep clean electricity a priority, though coal remains for energy security reasons. Climate targets aim to limit emissions growth, and the emissions peak in the early 2030s is promising for net-zero trajectories, including India’s goal to be carbon neutral by 2070. 

^{1 DNV forecasts the energy transition globally and in 10 world regions, including the energy trade between regions.}

In the table in the Appendix, we summarize our comparison of average regional emission reduction targets and present ETO forecast reductions, emphasizing 2050 or 2060, depending on announced targets.

No region is doing enough even to meet their own pledges, leaving the world far short of net zero, with global emissions remaining net-positive well into the second half of the century. Yet progress is uneven. Europe leads the pack, but even it reaches net zero only by 2064 in our forecast. If the frontrunner arrives 14 years late, what does that imply for the rest of the world? More importantly, what would it take for Europe to close the gap and reach net zero by 2050, and how would that shift influence others? 

 

Where is Europe headed and what is needed to reach net zero by 2050? 

In the ETO 2025, we forecast that Europe will become the first region to reach net-zero energy- and process-related CO₂ emissions. This milestone will be reached in 2064 through a combination of reduced fossil fuel dependency in all sectors, CCS in hard-to-decarbonize sectors, and additional carbon dioxide removal (CDR). Although EU policy now targets 50 Mt/yr CO₂ storage capacity by 2030 and 450 Mt/yr captured by 2050, we only forecast 350 Mt/yr by 2050. 

Europe’s path to net zero relies on policies few others have dared to test. Germany and the Netherlands are pioneering Carbon Contracts for Difference, guaranteeing a carbon price for green steel and cement. At the household level, policies such as Germany’s 65% renewable heating rule shows how Europe is extending the transition from factories to front doors. Europe is also creating a market for carbon removals, with Sweden’s BECCS auctions and Denmark’s CCS Fund paying for verified tonnes of CO₂ stored. Meanwhile, the EU Taxonomy requires financial institutions to disclose exposure to high-carbon assets. Not all efforts have worked – the early ETS oversupply and weak efficiency targets showed the price of learning – but Europe’s readiness to experiment keeps it ahead. 

In our forecast of the most likely energy future, Europe’s sectoral emissions fall at different speeds (Figure 4) because its systems have different kinds of inertia. Power changes fastest because investment cycles are short, technologies are mature, and policy is direct: shut coal, build renewables, connect grids. Industry follows once carbon prices bite hard enough to make electrification (direct or indirect through hydrogen) and capture viable. Transport moves faster than expected thanks to the rapid electrification of road vehicles, but aviation and shipping remain slow to shift despite fuel mandates (ReFuelEU for SAF in aviation and FuelEU Maritime). Buildings are the real drag: boilers last 15 years or more and retrofits disrupt daily life. By 2050, Europe will have cut deeply but not sufficiently. What’s left of emissions is less about physics than politics; how much disruption governments are willing to accept in people’s homes, habits, and wallets. 

 

 

 

Although 740 Mt of emissions in 2050 marks a steep decline from 1990 levels, closing the remaining gap is far harder than the numbers suggest. The last tonnes are the most expensive and intrusive to remove. Getting to net zero by 2050 rather than 2064 would mean intervening in natural replacement cycles, forcing retrofits, accelerating bans, and tolerating sharper rises in energy and consumer costs. These are not marginal adjustments but visible disruptions to daily life – flights, heating, food, commuting. Politically, that is where climate ambition tests voter patience and acceptance. Technically, too, the challenge hardens: you cannot capture carbon from a jet in flight or retrofit every home overnight. The final slice of emissions cuts will demand not just innovation, but discomfort. 

The table below outlines the additional policy measures needed to bring Europe’s net-zero date forward to 2050. This represents just one of several plausible pathways, where choices extend far beyond minimizing total cost. Each option must balance competing aims: the scale and timing of upfront investment, the distribution of costs between households and industry, the risk of carbon leakage, and the preservation of Europe’s industrial competitiveness. Equally, policies must consider the political limits of disruption and the strategic gains of building early leadership in clean technologies. The right mix will not simply depend on economics but on how Europe manages fairness, speed, and sovereignty in the final phase of decarbonization. 

 

Policy	Most likely future	Net zero by 2050
Carbon price	$230/t by 2050	$450/t by 2050 (with earlier coverage of buildings in ETS-2)
Taxes and levies on electricity price	16% VAT (households) + $40-50/MWh levies + capacity payments up to 7% of end use price	Levies moved to natural gas by 2035. No capacity payments
Buildings retrofit rate	1.25/yr in line with energy performance standards	2.5/yr by 2040
Heat pump subsidies	Avg. around $1000/kW, until cost parity with gas boiler is reached	Avg. around $1500/kW, continued support until much of the existing stock is replaced
EV subsidies	5-7% of vehicle price with a decline as price drops	8-10% of vehicle price with a decline as price drops
Hydrogen support	25-50% CAPEX support declining towards 2050 for green hydrogen, CfDs for European Hydrogen Bank	Sustained 25-50% CAPEX support with additional $1/kg OPEX support for green hydrogen
CCS support	CCS support grants and contracts covering 30–70% of capture + storage costs, reducing as cost decline	Additional support up to $80/t for industries with large process emissions

 

What are the implications of Europe reaching net zero by 2050? 

Shifting levies from electricity to gas would overturn old incentives and supercharge electrification across homes and factories. But a USD 450/t carbon price would also test Europe’s heavy industry. For some sectors, it is a tailwind, for others, a reckoning. Aluminium and fertilizer producers could gain from cheaper, cleaner power, while cement, steel, and chemicals would face sharper cost pressures and tougher investment choices. 

The Carbon Border Adjustment Mechanism offers partial protection by charging imports for their carbon content, levelling the economic playing field for steel, cement, and fertilizer. Yet that shield stops at the border. Exporters of cars, machinery, and chemicals must still compete in markets with no carbon price. Stronger CCS and hydrogen support – such as Germany’s green-steel projects or the Netherlands’ Porthos cluster – can cushion the blow, but a 2050 net-zero sprint would still strain margins and patience. 

In buildings, the shift is simpler but just as profound. Faster heat pump deployment raises their share from 39% to 60% of households by 2050, cutting natural gas use in homes from one-fifth to a tenth of total energy demand. Energy spending changes shape rather than size: households pay less for fuel and more for clean power and efficient systems, with total annual costs per household falling from about USD 5,000 today to USD 3,500 by mid-century. Europe’s building transition is not about paying more; it is about paying smarter. 

On the supply side, deeper electrification and renewables would trim Europe’s fuel import dependency from 56% today to 31% by 2050, compared with 35% in the most likely future. That shift means fewer energy shocks, less price volatility, and greater strategic confidence; the quiet dividends of a faster transition. But the benefits reach further. A more electrified, efficient energy system would stabilize household and industrial energy bills by insulating Europe from global fuel price swings. It would keep more value within domestic borders, create high-skill jobs across supply chains, and strengthen Europe’s balance of trade. By accelerating, Europe does not just pay earlier – it pays differently: less for fossil imports, more for assets that yield long-term resilience. 

Faster decarbonization would also give Europe first-mover advantage in shaping the next generation of energy markets. Smarter tariffs could protect basic consumption while rewarding flexibility, and better-designed capacity and carbon markets could guide investment where it matters most. Tackling real pinch points – from grid bottlenecks and transformer shortages to slow permitting and a lack of skilled workers – would bring greater returns than another round of subsidies. Europe’s edge has never been cheap energy but clever institutions. Leading this phase means innovating not only in technology, but in how its markets and policies work. 

 

How could Europe reaching net zero help the rest of the world? 

Bringing Europe’s net-zero date forward to 2050 would ripple far beyond its borders. Global CCS deployment would rise by nearly 30%, driving down capture costs by around 5% as European projects expand supply chains, build expertise, and prove business models. Heat pumps would follow the same learning curve logic, falling roughly 4% in cost by 2050 as manufacturing scales and European demand anchors global production. Together, these effects would trim emissions in the rest of the world by about 5%. 

The largest additional emission reductions appear in North America with 14%, where similar market structures, capital access, and technology supply chains make European practices quick to take hold. Impacts are smaller in Greater China (1.5%) and the Indian Subcontinent (4%) because local energy mixes, slower policy change, and protectionist industrial strategies limit direct uptake of European practices. In OECD Pacific, stronger policy alignment and import dependence amplify the emission reduction benefits (around 9%). 

Beyond technology learning, faster European decarbonization could have quieter but powerful spillovers: lower global equipment prices, greater investor confidence in clean infrastructure, and new standards for carbon accounting and trade. In short, Europe’s early action would not just clean its own energy system – it would bend global cost curves and set the pace for everyone else.

Appendix

Region	Details on regional CO2 emissions reduction targets and ETO forecast*
Greater China  (dominated by China)	China targets peak CO2 emissions before 2030 and a 65% reduction in carbon intensity – CO2 emissions per unit of GDP – between 2005 and 2030. China’s 2035 NDC targets a 7-10% reduction from peak levels by 2035.  Carbon neutrality by 2060.   ETO findings*:   CO2 emissions peak in 2025. Carbon intensity of the region’s economy reduces 59% (2005-2030). By 2035, emissions will reduce by 22% below peak levels, significantly overachieving the announced ambition. Emissions are projected to be 2.4 GtCO2 in 2060, falling short of carbon neutrality.
North America   (dominated by the US)	The US does not have a reduction target, withdrawing from the Paris Agreement in January 2025. Canada commits to a 40-45% reduction below 2005 levels by 2030 (28% below 1990 levels). The 2035 NDC aims for a 45-50% reduction below 2005 levels (33% below 1990 levels). Canada targets net zero by 2050.   ETO findings*  CO2 emissions in the region reduce 26% below 2005 levels by 2030 (10% below 1990 levels) and 33% below 2005 levels by 2035 (19% below 1990 levels). Between 2024 and 2050 emissions reduce 64%.  Emissions at 2.0 GtCO2 in 2050 and 0.9 GtCO2 in 2060.
Indian Subcontinent  (dominated by India)	Country NDC pledges aim to limit emissions growth to no more than 333% by 2030, relative to 1990. India aims to reduce carbon intensity of GDP by 45% between 2005 and 2030.  Pakistan’s NDC to 2035 is voluntary and indicative, aiming to reduce emissions by 50% (33% conditional, 17% unconditional), lowering ambitions since its 2030 NDC. India targets net zero by 2070.  ETO findings*   Emissions increase by 605% (1990-2030). Carbon intensity of the regional economy reduces by 22% (2005-2030). Emissions peak in 2032.  Between 2024 and 2060, CO2 emissions decrease by 33%. Remaining emissions are projected at 2.5 GtCO2/yr in 2060.
Middle East & North Africa	Country pledges aim to limit emissions growth to no more than 197% by 2030 relative to 1990.  The United Arab Emirates (UAE)’s 2035 NDC targets a 47% reduction below 2019 levels.  Israel, Oman, and the UAE target net zero by 2050, Turkey by 2053, and Bahrain and Kingdom of Saudi Arabia (KSA) by 2060.   ETO findings*    270% emissions increase to 2030. Emissions peak in 2038. Between 2024 and 2050, CO2 emissions decrease by 2% to 3.5 GtCO2. Remaining emissions are projected at 2.7 GtCO2 in 2060.
Europe	By 2030, the EU targets a 55% reduction by 2030 below 1990 levels. Germany and the UK aim for 65% and 68% by 2030, respectively.  For 2035, the EU statement of intent (September 2025) indicates a target range between 66.25% and 72.5%. Norway and the UK’s 2035 NDCs outline 70-75% and 81% reductions below 1990, respectively.  The EU-proposed 90% reduction target for 2040 is under negotiation. At time of writing, the Council of Ministers agree to 90%, with 5% from international carbon credits (raised from 3% in original proposal).  Germany aims for net zero by 2045, the EU’s mid-century net-zero ambition is shared by the UK, while Norway aims for 90-95% reduction by 2050.   ETO findings*  41% reduction by 2030 and about 51% by 2035 (below 1990). 61% reduction by 2040 (below 1990). Between 2024-2050, emissions drop 77% to 0.7 GtCO2/yr in 2050. Net zero is achieved 2064.
North East Eurasia	Country pledges aim for a reduction of 21% by 2030 below 1990 levels. Russia’s 2035 NDC targets a 33-35% reduction below 1990, a minor increase in ambition from its previous pledge. Kazakhstan, Russia, and Ukraine aim for carbon neutrality by 2060.  ETO findings*  Emissions decrease by 35% by 2030 and 38% by 2035 (below 1990).  Between 2024 and 2050, CO2 emissions decrease by 22%, the lowest reduction of any industrialized region. Emissions are projected at 1.6 GtCO2 in 2060.
South East Asia	Country NDC pledges aim to limit emissions growth to no more than 321% by 2030 compared to 1990 levels. Singapore’s 2035 NDC sets an absolute GHG emissions reduction target (between 45 to 50 MtCO2e in 2035). Malaysia, Singapore, and Vietnam target net zero by 2050, Indonesia by 2060, and Thailand by 2065.  ETO findings*  Emissions increase by 484% to 2030, indicating a shortfall on pledges.   Emissions are projected at 1.9 GtCO2/yr in 2050, 11% below 2024 levels and around 19% lower than the projected peak emissions in 2030. Remaining emissions at 1.4 GtCO2 in 2060.
OECD Pacific	Country pledges aim to reduce GHG emission by 10% by 2030, relative to 1990. 2035 NDCs from Australia (62-70% below 2005 levels), Japan (60% below 2013 levels), New Zealand (51-55% below 2005 levels). Compared to 1990 levels, this represents an average regional reduction target of 41% by 2035. South Korea has not submitted at time of writing. Australia, New Zealand, Japan, and South Korea aim for net zero by 2050.  ETO findings*:  CO2 emissions decrease 9% by 2030, below 1990 levels. Emissions decrease 22% to 2035, below 1990 levels.  Emissions at 0.5 GtCO2 in 2050, 70% below 2024 levels. Remaining emissions at 0.2 GtCO2 in 2060.
Latin America	Country NDC pledges aim to limit emissions growth to 64% by 2030, relative to 1990.   Brazil’s 2035 NDC targets 59% (unconditional) to 67% (conditional) below 2005 levels. Chile and Colombia set maximum, absolute emission limits by 2035. Argentina, Brazil, Chile, Colombia, and Mexico target net-zero emissions by 2050. ETO findings*:   CO2 emissions rise around 75% (1990-2030), and 79% to 2035. Emissions are at 1.3 GtCO2 in 2050 and 0.8 GtCO2 remain in 2060.
Sub-Saharan Africa	Country NDC pledges aim to limit emissions growth to no more than 153% by 2030 relative to 1990 levels (unconditional, some countries expect further reductions, provided there is international support). 2035 NDCs include Kenya’s unconditional target to reduce 7.5% from a business-as-usual scenario, and Nigeria’s 32% GHG reduction by 2035, from 2018 levels. A few countries have mid-century targets: Ethiopia, Kenya, South Africa, and Tanzania target net zero by 2050, Ghana and Nigeria by 2060, and Uganda by 2065.  ETO findings*:   Emissions increase by 122% (1990-2030) suggesting 2030 ambitions are met.  Emissions at 1.3 GtCO2/yr by 2050, a 52% increase from 2024 levels, and 1.4 GtCO2 in 2060.
*Energy- and process-related CO2 emissions (after CCS and after DAC)

Note: Country NDCs differ in their treatment of land-use emissions (AFOLU/LULUCF), target formats (fixed levels, base year references, or business-as-usual scenarios), and whether reductions are conditional on international support. To enable consistent cross-country comparison, we estimate unconditional emission reduction targets from 1990, excluding LULUCF, using Climate Action Tracker and the UNFCCC NDC Registry. We focus on major economies representing 80% of each Outlook region’s energy use, aggregating country-level data by GDP share to derive regional targets. 

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11/12/2025 8:33:00 AM