The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Energy Transitions

  • Peter J. G. Pearson
Reference work entry


This article explains why past, present and future energy transitions matter and why there is so much current interest in them in both developing and industrialised countries. It explores past transitions, including the first and subsequent industrial revolutions – and shows that although energy transitions have proceeded at various speeds in different places and times, and some of the more recent transitions have been faster, transitions do not usually happen quickly. An examination of lock-in, path dependence and the role of incumbents explains why there can be considerable inertia in energy systems and their technologies and institutions – but also suggests that incumbents may have an important role to play in a low-carbon transition. A brief review of recent studies in the area of sustainability transitions shows how researchers have aimed to understand transitions as interacting, co-evolving socio-technical processes and how studies that were mainly qualitative have now achieved better integration with quantitative analyses. A concluding discussion explores the many challenges involved in the governance and implementation of modern purposeful transitions, particularly low-carbon transitions. In these transitions, private incentives to adopt low-carbon fuels, technologies and practices are currently insufficient to ensure their adoption to the extent that makes sense for society; at the same time, the urgency of addressing greenhouse gas emissions from fossil fuels calls for unprecedentedly rapid change and the use of well-targeted, sustained but flexible policies and instruments.


Biomass fuel Climate change Energy policy Energy service Energy transition Environment Fossil fuel Greenhouse gas Industrial revolution Nuclear power Path dependence Primary energy Renewable energy Socio-technical transition 

JEL Classifications

Q32 Q43 Q57 O40 
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Work on this article was supported by funding from the UK Engineering and Physical Sciences Research Council (EPSRC) [Grant EP/K005316/1] under the ‘Realising Transition Pathways’ project. The author is solely responsible for the views expressed and any errors and omissions. He thanks Roger Fouquet and two reviewers for helpful and perceptive criticisms and suggestions.


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Authors and Affiliations

  • Peter J. G. Pearson
    • 1
  1. 1.