Improving Energy Transition Assessments with Regional Pathways

Four lessons learned from evaluating the transition pathway landscape in the Southeast Asia power sector

Financial institutions are under growing pressure to assess whether companies are truly prepared for the energy transition — but today’s tools fall short. Most transition assessments rely on global 1.5°C benchmarks that measure ambition but reveal little about whether a strategy is feasible in a given region or market.

What we learned from mapping Southeast Asia’s power pathways

A critical component of a decision-useful transition assessment is a multi-pathway approach that makes use of region- and sector-specific pathways wherever possible. This enables an assessment to go beyond just evaluating ambition against a global benchmark, and evaluates ambition based on regional context and constraints, determines alignment to different policy and market conditions, and infers the associated transition risks and opportunities of different strategies in the region.

A commonly cited challenge in adopting a multi-pathway approach is the lack of relevant and credible transition pathways, particularly in regions where pathway coverage is limited or fragmented. To address this challenge, RMI is developing the Transition Pathways Repository. The goal of this tool is to make the broad array of existing transition pathways readily accessible and interpretable. The repository is currently being piloted for the Southeast Asia power sector, with expansion to new sectors and regions planned this year.

Exploring the Southeast Asia power pathway landscape has taught us useful lessons about scenario data availability, remaining gaps in the scenario landscape, and the challenges to deploying a multi-pathway approach. This article describes four of those lessons:

1. The power pathway landscape in emerging markets is richer than expected.
2. Pathway developers output consistent and granular data points for most power sector indicators.
3. Access to underlying pathway data is still limited.
4. By focusing on generation, transition pathways can miss other dependencies

These lessons are useful both to FIs adopting a broader range of transition pathways, and to the pathway developers creating them. With more alignment between these actors, adoption of transition pathways can scale to equip FIs with the information needed to support their clients through the energy transition.

1. The power pathway landscape in emerging markets is richer than expected

Backward-looking metrics based on global benchmarks can inadvertently penalize jurisdictions with high emissions. This is particularly the case for emerging markets with a strong development mandate and young fossil fuel assets. However, these regions need more access to transition capital to deliver clean energy development goals, not less. One way to address this is with region-specific benchmarks that account for local realities. However, a commonly cited challenge by FIs is the perceived lack of ambitious and credible region-specific pathways in emerging markets, including Southeast Asia.

RMI’s systematic review of the pathways available in Southeast Asia revealed a much richer landscape of options than initially expected. There are almost 60 pathways currently available on the Repository from 17 different publications and 11 different institutions. This suite of pathways provides global, regional, and country-level pathways over a range of policy and climate outcomes from business-as-usual to net-zero and 1.5°C. This diversity and granularity gives FIs the tools they need to understand the potential operating environments that companies will need to navigate, and helps them assess companies’ plans and ambition in context.

Gaps do remain in the Southeast Asia power pathway universe; not every combination of regional granularity and policy or market assumptions is available on the repository. But those that are available can be more easily identified, compared, and applied by FIs than ever.

2. Pathway developers output consistent and granular data points for most power sector indicators

Transition assessment methodologies show a high degree of convergence around a core set of power-sector indicators, including absolute emissions, installed capacity mix, generation mix, and emissions intensity. Among the pathways included in the Transition Pathways Repository, 54 out of 56 provide capacity projections by technology, and 55 out of 56 include generation by technology. This consistency enables technology trends to be compared and benchmarked in a consistent way across different regions and assumption sets, ensuring transition assessments are repeatable and scalable.

This set of indicators further enables an understanding of not only how emissions might evolve, but also the underlying technology shifts that will drive changes in emissions. This means transition assessments can move beyond benchmarking emissions intensity and assess which technologies companies would need to deploy at what rate in order to align with different scenarios. Identifying these key transition technologies and their deployment timeframes informs richer engagement with clients.

Finally, the available technology granularity enables analysis of the dependencies of the transition. If a pathway shows that emissions reductions are driven by carbon capture and storage (CCS), CCS infrastructure needs to be deployed alongside power generation infrastructure. Likewise, if emissions reductions are driven by increasing renewables, grid storage and stability infrastructure will be needed alongside renewables deployment. Additionally, pathway users can then make their own judgements about the viability of these dependencies achieving the necessary scale to facilitate the rate of transition modeled in a pathway.

3. Access to underlying pathway data is still limited

Despite the core metrics above being modeled in most of the available transition pathways, the underlying data for these results is often confined to high-level reports and not readily available publicly. These reports provide the core drivers of change underlying the pathway narrative, describing the modeling approach and charting the key output results described in lesson 2. However, they often do not provide the actual pathway dataset that financial institutions need to put these pathways to use in transition plan quantitative assessments.

In developing the Transition Pathways Repository pilot, we reviewed 17 publications and engaged with 9 pathway providers to obtain the underlying data. In 2 cases, this data was made available to us so that it could be accessible for download in the Repository.

In many cases, the data is neither confidential nor behind a paywall; it is simply not being made available in a usable format. This adds an additional layer of effort and friction for FIs, preventing the use of additional pathways in transition assessments. For pathway developers, it likewise reduces the uptake of their analysis. Greater standardization and transparency in pathway outputs would benefit both pathway developers by increasing uptake, and FIs by lowering barriers to their use.

4. By focusing on generation, transition pathways can miss other dependencies

Almost all the available transition pathways in the pilot focus solely on power capacity and generation. Assumptions or modeling related to grid infrastructure, demand flexibility, interconnection, and investment needs are frequently simplified, lack granularity, or are absent. Accounting for and including all these factors into power system models would add significant complexity. However, those additional parameters are important as they help illustrate how the electricity sector, as a whole, needs to evolve in order to achieve its most ambitious goals. For FIs, this can reveal whether new power investments depend on network upgrades that may not yet be planned or financed.

For example, different technology choices will change the requirements for transmission and distribution improvements based on location of power generation relative to demand centers. Likewise, different technology mixes will require different levels of investment in demand flexibility and energy storage to account for intermittent renewables.

Next steps for the Transition Pathway Repository

These lessons reinforced some of the barriers identified by FIs to implement multi-pathway analyses in their transition assessments. However, we also found that there is a rich and diverse landscape of pathways already available, and the Transition Pathways Repository can help remove the barriers to their use by centralizing pathway data in a standardized and easy-to-use format. Looking ahead, the repository will continue to evolve and expand. Planned developments in 2026 include:

• Expanding to the steel and aviation sectors with global coverage.
• Expanding power sector coverage to new regions outside Southeast Asia.
• Improving usability and navigation to make it easier to identify the right pathway for a given use case.

The repository will remain a living resource that can improve through collaboration. We welcome the opportunity to work with financial institutions to gather feedback on usability and ensure the tool effectively supports real-world decision-making. We also invite pathway developers to help strengthen the repository by flagging pathways we may have missed, and by providing more transparent, standardized outputs that enable broader and more consistent uptake.

To learn more, contact Tom White at tomwhite@rmi.org.

The authors would like to thank Jacob Kastl, Nicky Halterman, and Hannah Barton who performed the analysis on these pathways to inform the insights here.