Global energy investment is projected to reach an unprecedented $3.3 trillion in 2025, according to a recent report from the International Energy Agency (IEA). This surge in investment comes despite geopolitical tensions and economic uncertainties. Notably, clean energy technologies are expected to attract twice as much investment as fossil fuels.
This year alone, capital in clean technologies—including renewables, nuclear, grids, storage, and low-emission fuels—is estimated to hit $2.2 trillion, driven by emissions reduction efforts and increasing energy security concerns. Meanwhile, investment in oil, natural gas, and coal is estimated to reach $1.1 trillion. The IEA report highlights significant changes in the investment landscape over the past decade.
IEA Executive Director Fatih Birol noted that energy security has emerged as a crucial factor influencing global energy investments. Many countries and organizations are focusing on mitigating risks associated with energy supply and demand. While some investors have adopted a cautious approach to new project approvals, current projects have not faced significant setbacks.
Looking back, China has become the world’s largest energy investor, spending twice as much on energy as the European Union and almost as much as the EU and United States combined. Over the last decade, China’s share of global clean energy expenditures has risen significantly, driven by investments in various technologies such as solar, wind, and batteries. The report indicates a trend toward the Age of Electricity, with investments in electricity generation and associated infrastructure expected to surpass spending on fossil fuels.
Notably, investments in solar power are projected to be the largest component of global energy spending, while funding for battery storage is also increasing rapidly. However, investment in grid infrastructure has not kept pace with rising demand for electricity, raising concerns about electricity security in the future. In contrast, the upstream oil investment sector faces a notable decline, largely due to lower oil prices and a decrease in spending on U.S. tight oil.
Meanwhile, investments in liquefied natural gas (LNG) facilities are thriving, with significant projects coming online in the next few years. Nonetheless, many developing regions, particularly in Africa, continue to struggle with mobilizing necessary capital for energy infrastructure, highlighting the need for increased international financial support. This year’s World Energy Investment report includes an interactive data explorer, allowing users to analyze trends in energy investments over different periods and across various sectors and regions.