Global energy investment is set to increase in 2025 to a record $3.3 trillion despite headwinds from elevated geopolitical tensions and economic uncertainty, a new IEA report says, with clean energy technologies attracting twice as much capital as fossil fuels.
The 2025 edition of the IEA’s World Energy Investment report reveals that investment in clean technologies—including renewables, nuclear, power grids, storage, low-emission fuels, energy efficiency, and electrification—is on track to hit an unprecedented $2.2 trillion this year.
This surge reflects not only the global push to reduce emissions but also the growing influence of industrial policy, energy security concerns, and the cost competitiveness of electricity-based solutions. In comparison, investments in oil, natural gas, and coal are expected to total $1.1 trillion.
In addition to a comprehensive assessment of the current investment landscape across fuels, technologies, and regions, this 10th edition of the World Energy Investment report explores some of the major changes over the past decade.
According to the IEA, the global energy outlook has been clouded by geopolitical and economic uncertainties in recent times.
“Amid the geopolitical and economic uncertainties that are clouding the outlook for the energy world, we see energy security coming through as a key driver of the growth in global investment this year to a record $3.3 trillion as countries and companies seek to insulate themselves from a wide range of risks,” said IEA Executive Director Fatih Birol.
“The fast-evolving economic and trade picture means that some investors are adopting a wait-and-see approach to new energy project approvals, but in most areas, we have yet to see significant implications for existing projects.”
“When the IEA published the first ever edition of its World Energy Investment report nearly ten years ago, it showed energy investment in China in 2015 just edging ahead of that of the United States. Today, China is by far the largest energy investor globally, spending twice as much on energy as the European Union – and almost as much as the EU and United States combined.”, Dr Birol added.
Over the past decade, China’s share of global clean energy spending has risen from a quarter to almost a third, underpinned by strategic investments in a wide range of technologies, including solar, wind, hydropower, nuclear, batteries, and EVs. At the same time, global spending on upstream oil and gas is gravitating towards the Middle East.
In a worrying sign for electricity security, investment in grids, now at $400 billion per year, is failing to keep pace with spending on generation and electrification. Maintaining electricity security would require investment in grids to rise towards parity with generation spending by the early 2030s. However, this is being held back by lengthy permitting procedures and tight supply chains for transformers and cables.
Lower oil prices and demand expectations are set to result in the first year-on-year fall in upstream oil investment since the Covid slump in 2020, according to the report.
The expected 6% drop is driven mainly by a sharp decline in spending on US tight oil. By contrast, investment in new liquefied natural gas (LNG) facilities is on a strong upward trajectory as new projects in the United States, Qatar, Canada, and elsewhere prepare to come online. Between 2026 and 2028, the global LNG market is set to experience its largest ever capacity growth.
According to the IEA, Africa accounts for just 2% of global clean energy investment. Despite being home to 20% of the world’s population and rapidly growing energy demand, total investment across the continent has fallen by a third over the past decade due to declining fossil fuel spending and insufficient growth in clean energy.
To close the financing gap in African countries and other emerging and developing economies, international public finance needs to be scaled up and used strategically to bring in larger volumes of private capital, according to the report.
Recently, President Bola Tinubu signed a new Executive Order, Upstream Petroleum Operations Cost Efficiency Incentives Order (2025), aimed at reducing project costs, boosting investment, and increasing revenue in Nigeria’s oil and gas sector.
The Directive introduces performance-based tax incentives for upstream operators that achieve verifiable cost savings aligned with defined industry benchmarks.
The Directive introduces performance-based tax incentives for upstream operators that achieve verifiable cost savings aligned with defined industry benchmarks.
This latest Executive Order builds on the administration’s 2024 reform directives, which enhanced fiscal terms, shortened project timelines, and aligned local content requirements with global best practices.