Navigating the energy trilemma : integrating technological innovation and digitalization transition for sustainable solutions

Abstract

Understanding how technological innovation (TI) and digitalization transition (DT) independently shape energy security, energy equity, and environmental sustainability is crucial for effectively addressing the energy trilemma. However, existing literature lacks a comprehensive analysis that distinguishes their impacts, complicating efforts by countries to reconcile competing priorities and achieve overall improvements. This study addresses this gap by systematically comparing the influences of TI and DT on each aspect of the energy trilemma. The resulting targeted policy recommendations provide guidance for countries seeking to alleviate these challenges. The empirical analysis is based on panel data from 14 countries (2000−2021) using a dual-method approach that combines Partial Least Squares Structural Equation Modeling and fuzzy-set Qualitative Comparative Analysis (fsQCA). The findings reveal that: (1) TI strengthens energy equity and environmental sustainability but inadvertently undermines energy equity, whereas DT simultaneously enhances all three aspects of energy trilemma. (2) Industrial structure, natural resource rents and energy structure critically mediate the relationships between TI, DT and the energy trilemma, potentially amplifying, dampening, or even reversing their effects. Building on these insights, fsQCA identifies tailored strategies for alleviating the energy trilemma: (1) Resource-endowed countries should enhance environmental sustainability by strategically integrating TI/DT to diversify their energy portfolios; (2) Developing countries should improve energy equity by leveraging DT-driven initiatives to broaden energy accessibility; (3) Rapidly industrializing countries need to enhance environmental sustainability through targeted investments in green technology innovation. By bridging methodological and contextual divides, this research advances a holistic framework that enables policymakers to navigate trade-offs, align global energy goals with local realities, and accelerate progress toward a balanced resolution of the energy trilemma.