Global Energy Investment to Hit Record $3.3 Trillion in 2025, Driven by Clean Power Surge

Global energy investment is set to reach a record $3.3 trillion in 2025, with clean power technologies attracting the lion’s share amid rising geopolitical tensions and economic uncertainty, the International Energy Agency (IEA) reported.

According to the IEA’s latest analysis, $2.2 trillion of that total will go toward low-emission technologies such as renewables, nuclear energy, and storage systems. Meanwhile, investment in fossil fuels — oil, gas, and coal — is projected to reach $1.1 trillion.

IEA Executive Director Fatih Birol said the surge in clean energy spending reflects a global push for energy security. “Amid the geopolitical and economic uncertainties clouding the outlook for the energy world, we see energy security coming through as a key driver,” Birol said. “Countries and companies are acting to insulate themselves from a wide range of risks.”

Electricity investment will lead the way, with a projected $1.5 trillion to be spent on generation, grid expansion, and storage — 50% more than total investment in fossil fuels. This shift marks a major reversal from a decade ago, when fossil fuel investment outpaced electricity spending by 30%.

The rise in electricity demand — fueled by data centers, AI applications, electric vehicles, and industrial needs — is reshaping global energy priorities. The IEA noted that electricity consumption by AI-powered data centers is expected to double by 2030, creating both opportunities and challenges for global grids.

Solar power remains the largest driver of clean energy investment. Spending on utility-scale and rooftop solar projects is expected to hit $450 billion in 2025, thanks in part to competitive pricing and global adoption, particularly in emerging economies.

Saudi Arabia, for instance, aims to produce 58.7 GW of renewable energy by 2030, with 40 GW from solar PV. The Kingdom is also expanding into nuclear energy and green hydrogen. NEOM Green Hydrogen Co. is on track to launch the world’s largest green hydrogen plant by 2026, powered entirely by solar and wind energy.

However, the IEA warned that investment in grid infrastructure — currently at $400 billion — is lagging behind, potentially undermining future electricity security. Lengthy permitting processes and supply chain constraints are to blame, the agency said.

On the fossil fuel front, upstream oil investment is expected to decline by 6% in 2025 — the first drop since the pandemic. In contrast, liquefied natural gas (LNG) projects are booming, with new facilities in the U.S., Qatar, and Canada set to boost global LNG capacity between 2026 and 2028.

Despite global momentum, clean energy investment remains uneven. Africa, home to 20% of the world’s population, accounts for just 2% of investment. The IEA called for greater international public financing to help bridge the gap in developing economies.

China continues to lead global energy investment, accounting for nearly one-third of global clean energy spending. India and Brazil also show promising trends, according to the report.