‘New reality’ as world reaches first climate tipping point – unpacking the Global Tipping Points report

The world faces a ‘new reality’ after reaching the first of many Earth system tipping points that will cause catastrophic harm, according to a landmark report released today (13 Oct) by the University of Exeter and international partners.

With global warming set to breach 1.5°C, the Global Tipping Points report – by 160 academics at 87 institutions in 23 countries, including GFS Impact Fellows Dr Steve Smith and Jesse Abrams – argues that countries must minimise temperature overshoot to avoid crossing more tipping points. Every fraction of a degree and every year spent above 1.5°C matters.

Action to trigger “positive tipping points” of self-propelling change – such as the rollout of green technologies – now offers the only credible route to a safe, just and sustainable future, the report says.

As the second Global Tipping Points Report releases, the Green Futures Solutions team have unpacked the key takeaways for finance and industry. Below are some of the key headlines, along with analysis from contributors:

Energy Transition is Firmly Underway

Solar, Wind, and Battery Storage Leading the Charge

Positive tipping points have already been crossed in solar PV and wind power globally, and in the adoption of electric vehicles, battery storage and heat pumps in leading markets. These transitions can still be accelerated. Coordinated policy action at “super-leverage points” can unleash positive tipping cascades across interacting sectors (e.g. power, transport and heating), bringing forward tipping in all. Once replaced, polluting technologies are unlikely to return because the new options are cheaper and better. Social attitudes are also tipping. Concern about climate change is growing globally – and even small numbers of people can tip the majority.

Key Indicators:

• Solar PV and wind power have now reached an inflection point globally, whereby change becomes self-propelling.
• Combined, solar PV (1865) and wind (1133 GW) provided 15% of global electricity generation capacity in 2024, and could remove 26% of current global GHG emissions with further electrification in other sectors.
• 99 countries have doubled (or more) the amount of electricity they produce from solar power in the last five years.
• Notably, in the US, wind and solar overtook coal power for the first time in 2024, generating 17% of the USA’s electricity. This growth trend is expected to continue despite political headwinds, with solar and battery storage expected to contribute over 80% of new capacity additions in 2025.
• Globally, clean-energy investment topped USD 2 trillion in 2024, surpassing fossil-fuel spending for the first time — a clear sign that finance is already tipping in parts of the system.
• Battery prices have plummeted by 84% in the last decade and 20% in 2023-24, with exponential growth in installed storage capacity driving mobility and power transitions. For example, in the UK EVs market, falling battery costs (predicted to fall below $100 per kWh threshold by 2026) would make EVs as cheap to manufacture as their petrol-powered counterparts.
• Green hydrogen production is growing, from 1.0 Mt per year in 2023 to potentially 49 Mt per year in 2030 based on announced projects. Global installed electrolyser capacity was nine times larger in 2024 than 2021 (0.2-5.6 GW), and investment in electrolyser installation grew from 0.3 bn USD to 7 bn USD in the same period, despite a lack of investor certainty around projected hydrogen demand that, if addressed, could increase such investments further.

As Dr Steve Smith put it, “in the two years since the first Global Tipping Points Report, we’ve seen a phenomenal global uptake of clean energy – especially in China – with solar power doubling every 2-3 years, the sale of electric vehicles and heat pumps also growing exponentially in leading markets, and the cost of batteries continuing to plummet.

“Despite some political and economic headwinds, public engagement and support for climate action remains strong, with 80% of people globally wanting their country to do more and 72% wanting to transition away from fossil fuels quickly. The biggest obstacle now lies in how to govern and cooperate for this rapid transition. We’re used to policy and planning for incremental change, but we’ve never had to transform the entire energetic basis of society in a single generation before. Reducing planning delays, providing grid infrastructure, and finance can all accelerate change.”

Finance can ‘Tip’ the System

Pricing systemic risk and incentivising the right investment flows is key 

Key Indicators:

• Worsening weather extremes and physical impacts are accelerating risks to capital – leading to fears of an insurability crisis. By realistically pricing systemic risks and creating markets for adaptation, private finance has the potential to trigger positive tipping points by unlocking financial flows towards decarbonisation and nature conservation.
• Globally, clean-energy investment topped USD 2 trillion in 2024, surpassing fossil-fuel spending for the first time — a clear sign that finance is already tipping in parts of the system.
• However, growing geopolitical fragmentation risks deepening financial lock-ins and leaving developing economies stuck in a climate investment trap. Without shared standards or predictable policy signals, uncertainty feeds financial lock-ins, keeping capital costs high and deterring long-term investment.
• Early, well-aligned interventions can unlock self-reinforcing shifts in investment expectations, behaviour and regulations. Once those feedbacks take hold, low-carbon finance no longer relies on subsidies or mandates; it becomes the norm. For example, if the cost of low-carbon capital in Africa fell just a few percentage points through appropriate policies, the continent could reach net zero nearly a decade earlier, with a cumulative impact of $430 billion extra low-carbon investment between 2020 and 2050.

Thanks to Professor Nadia Ameli, author and Professor of Climate Finance at UCL, for her analysis here. She added: “Our research shows that finance itself can reach tipping points – moments when small, well-aligned interventions unlock self-reinforcing shifts in investment behaviour. But growing geopolitical fragmentation risks deepening financial lock-ins.

“Breaking these path-dependent cycles will require coordinated action, concessional finance and smart regulation – from public funds that crowd in private capital to prudential rules that phase down fossil lending.

Dr Jesse Abrams, a fellow author and tipping points specialist in the Green Futures Solutions (GFS) team, University of Exeter, said: “Today’s reality is that climate risks are already causing immediate costs to our food, health, and economy – from billion-dollar climate disasters to rising food prices. If we continue without urgent policy action, our analysis estimates global GDP growth could fall by 50% between 2070 and 2090.

“However, the right intervention today can mitigate up to 90 per cent of projected GDP loss and human deaths, according to our analysis. Couple that with the economic upsides of a renewable energy transition that has already tipped, bringing investment opportunities and cost savings, and the business case is clear.”