ISTANBUL 

The International Energy Agency (IEA) reported Thursday that the global energy investment is set to increase 2% in 2025 to an all-time high of $3.3 trillion despite headwinds from elevated geopolitical tensions and economic uncertainty.

The clean energy technologies are expected to attract twice as much capital as fossil fuels, according to the agency's World Energy Investment 2025 report.

"Investment in clean technologies—renewables, nuclear, grids, storage, low-emissions fuels, efficiency, and electrification—is on course to hit a record $2.2 trillion this year, reflecting not only efforts to reduce emissions but also the growing influence of industrial policy, energy security concerns, and the cost competitiveness of electricity-based solutions," the report said.

Meanwhile, investments in oil, natural gas, and coal are expected to reach $1.1 billion. Clean energy investments, which are expected to reach a record high this year, will account for two-thirds of the total amount of investment.

- 'New Age of Electricity'

"Today’s investment trends clearly show a new Age of Electricity is drawing nearer. A decade ago, investments in fossil fuels were 30% higher than those in electricity generation, grids, and storage. This year, electricity investments are set to be some 50% higher than the total amount being spent bringing oil, natural gas, and coal to market," the report stressed.

Over the last five years, global investment in low-emissions power production has nearly quadrupled, driven mostly by solar PV (photovoltaics).

Utility-scale and rooftop solar energy investments are predicted to total $450 billion in 2025, making them the biggest item in the global energy investment inventory. Additionally, investments in battery storage are growing quickly, surpassing $65 billion this year.

On the other hand, grid investments, which now stand at $400 billion annually, are falling behind expenditure on electrification and generation, which is concerning for the security of power.

By the early 2030s, grid investment would need to catch up to generating spending in order to maintain electrical security. Long licensing processes and constrained transformer and cable supply chains are impeding development.

- China: Biggest energy investor in world

As the biggest energy investor in the world, China keeps solidifying its position. Over the past ten years, China's contribution to global energy spending has increased from 25% to 33%.

Investments in a variety of technologies, including solar, wind, hydropower, nuclear, batteries, and electric cars, are helping to sustain this development.

India and China are still investing in coal-fired power plants. The capacity of authorized new coal plants in China, which started building about 100 gigawatts of new coal plants last year, is at its highest level since 2015.

Commenting on the report, IEA Executive Director Fatih Birol said: “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."

“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," he added.