The International Energy Agency released its 2026 energy investment report, highlighting the key investment regions and sectors as the world continues to deal with the energy crisis caused by the Iran war and the closure of the Strait of Hormuz. Global energy investment is expected to reach about $3.4 trillion in 2026, with clean energy attracting about $2.2 trillion, almost double the level flowing into fossil fuels. This is due to an increasing need for energy security.
China remains by far the largest national investor in clean energy, partially due to its advanced industrial base and growing expertise in the technologies, but also in part due to its vulnerability to energy supply shocks as the globe’s largest fossil fuel energy importer. China’s expertise covers a number of the sector’s most important components, including solar, wind, battery storage, electric vehicles and smart grid solutions to better manage peak demand. Utilizing its advantage in the field, Beijing is also able to export large volumes of clean energy technologies to the Global South.
Europe and the U.S., meanwhile, are also heavily investing in their own clean energy technology to ensure they do not become dependent on Chinese technology. For Europe, the priority is to reduce fossil fuel dependence without replacing reliance on Russia or Middle Eastern suppliers with a new strategic dependence on Beijing. In the U.S., the investment in renewables and clean energy is driven by private industry, while the government has also rapidly expanded and ramped up investments and permitting for new fossil fuel extraction sites.
The regional imbalance remains stark. Advanced economies, China and Asia-Pacific account for dominant clean energy flows. In emerging and developing economies excluding China, and especially in Africa, fossil fuel and other energy investment still outweighs clean energy, reflecting financing constraints, grid gaps and continued energy access needs. The overall picture is not a simple transition away from fossil fuels but a global race to build resilient, affordable energy systems, secure supply chains and reduce exposure to external shocks.
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