Probing the Energy Trilemma Pillars: Do Innovation Pathways Deliver Cleaner and More Equitable Energy Systems?

Abstract

ABSTRACT Balancing reliable energy supply, equitable access, and environmental sustainability is a central challenge of the global energy transition. This study examines how innovation influences the energy trilemma by shaping energy security, energy equity, and environmental sustainability across 115 countries from 2011 to 2023. Using World Energy Council trilemma indicators and the Global Innovation Index, the analysis applies a long‐difference regression approach to distinguish the short‐run, transitional, and long‐run effects of innovation within energy systems. The results show that innovation can generate short‐run disruptions, especially for energy security and energy equity, due to adjustment costs, infrastructure upgrades, and the high initial investment required for new technologies. These negative effects weaken over time as innovation accumulates and energy systems mature. The interaction between current innovation shocks and prior innovation stock reveals positive transitional effects, suggesting that the benefits of innovation emerge gradually through learning, diffusion, and system integration. The findings also indicate heterogeneous outcomes across development groups. Advanced economies experience stronger transitional gains in energy security and equity, while emerging and developing economies show stronger long‐run environmental improvements, reflecting technological catch‐up opportunities. Mechanism analysis further suggests that trade supports the diffusion of cleaner technologies but may initially heighten energy insecurity and inequality through external dependence. Overall, the findings show that innovation alone cannot resolve the energy trilemma. Its effectiveness depends on governance quality, regulatory support, and institutional capacity, highlighting the need to combine technological innovation with inclusive policy frameworks for secure, equitable, and sustainable energy transitions.