Climate in a Populist Age: Why Decarbonisation Won’t Stop But Will Get Messier

What happens to climate action when the political weather turns populist: more inward-looking, more suspicious of experts, more focused on growth and national pride than on multilateral promises? That’s no longer an abstract question. Across the West, parties and leaders with nativist or “majoritarian” instincts are either in office or within reach of it. Meanwhile, China is doubling down on renewables and exporting the kit to the rest of the world.

If you work in energy, industry, finance, or public policy, the uncomfortable truth is this: the energy transition won’t end in a populist era, but it will change character. It will proceed unevenly, be driven less by public-spirited politics and more by industrial arithmetic, and it will shift who gets to claim leadership.

This article builds on an internal study for SAMI Consulting, “Rise of Populist Politics: Implications for SAFIRE, SIP, Energy and Climate Change Mitigation”, which studied the implications of nativist political approaches to the development of our European Commission SAFIRE scenarios and our joint Sustainable Innovations Pathway project.

From moral project to industrial arithmetic

Since the Paris Agreement in 2015, climate policy has been sold as a liberal, cooperative achievement: science-led, rules-based, and negotiated in international forums. However, if the liberal centre continues to lose elections, the framing changes. Climate becomes less of a moral project and more of a competitiveness problem: how to secure cheap, reliable power; how to ensure national energy security; how to protect domestic jobs; how to keep up with rivals building battery gigafactories and data centres. Economics picks up where politics leaves off.

This matters because key parts of the transition are already baked into business plans:

• Sunk costs. Heavy industry and utilities have committed billions to low-carbon investments in projects such as hydrogen pilots, carbon capture demonstrations, electrification, and long-term power purchase agreements. Walking away would strand assets and careers. Boards will fight to defend what they’ve already paid for.

• Falling costs. Solar, wind, and storage continue to become increasingly affordable. Even a government hostile to climate rhetoric will struggle to justify paying more for fossil fuel electricity than for renewable energy.

• Exploding demand for “cheap electrons.” Data centres, AI clusters, and semiconductor fabs need colossal volumes of clean, low-cost power. Their lobbying is about competitiveness first, climate second. And it still favours renewables.

In short, the economic engine of decarbonisation keeps running even when the political drivers go into reverse.

What populism changes, and what it doesn’t

Populist governments tend to be sceptical of carbon prices, cross-border schemes, and technocratic regulators. Expect weaker carbon markets, softer environmental standards, “drill more” reflexes, and episodic hostility to green industrial policy, especially where it is seen as elite, urban, or subsidised at the expense of “ordinary” voters.

Yet several realities remain stubbornly in place:

• Renewables as energy security. In a fragmenting world with more sanctions and supply-chain shocks, imported fossil fuels look riskier. Domestic wind, solar, and storage reduce exposure to commodity price spikes and geopolitical chokepoints. That logic still holds, whatever the ideology.

• Corporate momentum. Large firms now run internal carbon prices, issue green bonds, and report to investors on transition plans. Even if national policy wobbles, capital markets keep asking, “What’s your plan?”

• Path-dependent infrastructure. Once you start building grids for electrification and hydrogen corridors for industry, the network effects push further build-out. Projects finish because half-built systems are worse than complete ones.

The likely outcome in the West is partial decarbonisation: efficiency gains and renewable power continue; policy-dependent plays such as full hydrogen backbones, very large carbon-capture systems stall or proceed in select pockets. The result is uneven progress: some sectors surge ahead because the economics work; others lag because the politics won’t support long-lived, capital-intensive bets. Temperature trajectories drift off the most ambitious pathways, not towards collapse, but towards a warmer, riskier world than Paris envisaged.

Who leads when politics fails?

Two actors fill the vacuum. Beijing positions itself as the supplier of the energy transition: dominant in solar, batteries, and increasingly in electric vehicles. It frames this as both climate leadership and national strategy. For buyers, Chinese equipment lowers capital costs; for Western politicians, this raises uncomfortable questions about dependence and tariffs. The tension between “cheap electrons” and “energy sovereignty” becomes a defining policy fight.

And Multinationals with global supply chains and investor scrutiny keep decarbonising even if the host government is lukewarm. They sign long-term renewables contracts, electrify processes, and hedge against volatile fossil prices. In practice, that means significant emissions reductions without politics - progress by procurement rather than by treaty.

Risks that get bigger in a populist era

If geopolitics is rougher and there are more wars, and more sanctions, the “drill more” instinct can backfire and fossil fuel exposure gets volatile. Supply disruptions and price spikes punish households and manufacturers; renewables look safer precisely because they’re boring. Secondly, if border measures soften and carbon prices wobble, dirty production can move to jurisdictions with laxer rules. That undermines domestic decarbonisation and invites trade spats.

And it costs more. As climate impacts intensify leading to more heat, floods, and droughts, actuaries and reinsurers reprice risk. That cascades into mortgages, municipal finance, and infrastructure insurance, forcing adaptation spending whether or not it’s politically fashionable.

Metrics to watch

1. Corporate power-purchase agreements (PPAs). Rising volumes signal that firms are locking in renewables regardless of public policy noise. This foretells grid demand shifts and investment in storage.

2. Shadow carbon prices. If internal pricing remains stable while official markets wobble, investors still expect transition discipline.

3. Trade policy on green tech. Tariffs on solar, batteries, or EVs raise costs and slow deployment; carve-outs or “friend-shoring” deals accelerate it. Watch how governments balance industrial nationalism against the need for cheap equipment.

4. Grid investment and permitting. Even the most pro-fossil cabinet wants lights on and factories humming. Faster grid build-out enables almost every decarbonisation pathway.

5. The tech sector’s energy strategy. Data-centre siting, long-duration storage procurement, and private wires are early indicators of where clean capacity will race ahead.

   
   

The uncomfortable middle path

We are probably not heading towards outright climate nihilism. Instead, we see a more chaotic middle: enough decarbonisation to keep economies competitive and lights on; not enough, fast enough, to meet the most ambitious temperature goals. The politics will be noisy. Progress will be driven by spreadsheets more than speeches. Leadership will migrate from parliaments to boardrooms and, increasingly, to factories and grid operators.

That might frustrate those looking for political climate action. But it might be workable. In a populist age, the centre of gravity for climate action moves from global compacts to pragmatic execution: building networks, cutting costs, derisking projects, and making clean energy the default because it is cheaper, safer, and harder to argue against.

If we accept that shift, and design for it, we can keep the transition moving even through rough political weather. It’s not good enough to wish the old consensus still holds; that just leads to arguments and wasting time we don’t have.

This seems to be the choice in front of us. Not Paris-style grandeur, but steady progress made one interconnector, one PPA, one factory conversion at a time. It’s less inspiring. It may also be how we get enough done, soon enough to matter.

Written by Jonathan Blanchard Smith, SAMI Director

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

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Image by Erich Westendarp from Pixabay