Energy investment around the world is reaching a record $3.3 trillion this year, and clean energy is getting twice as much funding as fossil fuels even with economic troubles and political tensions everywhere. The International Energy Agency’s (IEA) latest report shows renewable energy, nuclear plants, power grids, storage systems, and efficiency upgrades will pull in $2.2 trillion in 2025. Oil, gas, and coal projects will get $1.1 trillion.
China has become the biggest energy investor in the world, spending twice what the European Union does and almost as much as Europe and the United States put together. In the past decade, China went from funding about 25% of global clean energy projects to nearly 33%, pouring money into solar panels, wind farms, hydropower dams, nuclear plants, batteries, and electric vehicles.
Solar power is attracting the most investment of any technology, with spending expected to reach $450 billion in 2025 for both utility-scale and rooftop installations. Battery storage investment is also climbing rapidly, surging above $65 billion this year, while nuclear investment has grown 50% over five years to around $75 billion.
IEA Executive Director Fatih Birol said energy security concerns are driving much of the investment growth as countries and companies try to protect themselves from various risks. “The fast-evolving economic and trade picture means that some investors are adopting a wait-and-see approach to new energy project approvals,” he noted.
The report highlights a shift toward what the IEA calls a “new Age of Electricity.” Ten years ago, fossil fuel investments were 30% higher than electricity generation, grids, and storage. This year, electricity investments will be about 50% higher than total spending on oil, gas, and coal. However, grid investment at $400 billion annually isn’t keeping up with generation and electrification spending, creating potential security risks.
