Global Energy Transition Investment Hits USD 2.4 Trillion But Falls Short Of Climate Targets – IRENA

Global investment in energy transition technologies reached an impressive level in 2024, touching USD 2.4 trillion and marking a strong 20% rise compared to the average of the previous two years. This shift is important because, for the first time, the money going into renewable power, grids, and battery storage crossed USD 1.19 trillion, which is more than what was invested in fossil fuels at USD 1.13 trillion. It shows that the world is moving faster toward a low-carbon future, driven by the urgency to act on climate change.

A major force behind this growth has been solar power, especially Solar PV, which attracted USD 554 billion in 2024. This was a huge 49% increase and clearly shows the technology’s leadership in the global clean energy push. Other technologies also grew quickly. Electric vehicles saw an investment of USD 763 billion, which was a rise of 33%. Battery storage stood out with the fastest growth at 73%, taking the total investment in this sector to USD 54 billion. Power grids, which play a key role in carrying clean energy to people, grew by 14% to reach USD 359 billion. If we look only at renewable energy, the total investment reached USD 807 billion, marking a 22% rise compared to the average of the previous period.

Even with this strong financial growth, the world is still not on track to meet major climate goals. The investment required to align with the IRENA 1.5°C pathway is much higher than current levels, especially in renewable power and grids. The report highlights that average investment in these areas needs to almost double between 2025 and 2030 to keep the world on a safe climate path. This gap is one of the biggest challenges slowing the global transition.

Another major concern is the uneven distribution of investment across regions. China and advanced economies together accounted for 90% of all energy transition funding in 2024. Meanwhile, Least Developed Countries received only 0.22%, and several nations in Sub-Saharan Africa continue to be left behind. The difference becomes even clearer when looking at per capita investment. China invested USD 248 per person and Europe USD 229 per person. Sub-Saharan Africa managed only USD 15 per person, showing how far behind the region is in the clean energy shift.

In terms of who is funding this transition, private investment plays the biggest role with 60% of the financing, or USD 397 billion, while public investment makes up 40%, about USD 265 billion. Most of this investment also remains within the same country or region. For example, 99% of China’s renewable energy investment is domestic, and Europe sources about 81% from within the region. In Sub-Saharan Africa, only 53% of the investment is domestic, which means the region depends heavily on international support.

The report stresses the need for stronger policies and targeted financial solutions to close the investment gap. It calls for greater international cooperation and expects advanced economies to increase their financial support for emerging markets and developing countries. It also warns that public subsidies and state-owned enterprises still support fossil fuels, which must change if the global transition is to succeed. The report highlights that investment must also focus on supply chains, including manufacturing and the mining of key minerals like lithium, to ensure fair and sustainable development, especially for developing countries.