Global energy investment is set to reach an unprecedented $3.3 trillion in 2025, as capital continues to shift rapidly into clean technologies, according to the International Energy Agency’s latest annual assessment.
Despite ongoing macroeconomic uncertainty and geopolitical flashpoints, clean energy is on track to attract $2.2 trillion in 2025—double the allocation forecast for fossil fuel projects.
The IEA’s World Energy Investment report highlights renewables, nuclear, and energy storage as the main magnets for capital in the global energy landscape.
Solar power is poised to lead the pack, with investments set to approach $450 billion, while battery storage—crucial for balancing the volatility of renewable supply—will see investment climb to around $66 billion.
In stark contrast, fossil fuel investment is set to shrink, with upstream oil spending projected to decrease by 6%—the sector’s first contraction since the 2020 Covid downturn—as lower crude prices and tempered demand curb enthusiasm for new projects.
One area of concern flagged by the IEA is the lag in spending on electricity grids, which is forecast at $400 billion per year, trailing the amount earmarked for generation and electrification.
The agency cautions that securing electricity supply will require grid investment to nearly match generation spending before the next decade, a target currently hampered by regulatory hurdles and strained transformer and cable supply chains.
The report underscores that while China commands almost a third of global clean energy investment, many developing countries remain constrained by limited access to finance, reflecting a growing divide in the transition to low-carbon infrastructure.
