This is an extract from a recent report “World Energy Investment 2025” by IEA.
United States
The United States is a major investor in all fuels and all energy technologies. The United States has made substantial energy investment over the past decade as part of a broader effort to establish itself in new value chains and supply international markets. It became a net energy exporter in 2019, a remarkable turnaround from its high previous reliance on imports. In 2024 it remained the world’s largest producer of oil and gas (20%) and a major investor (25%), buoyed by rising investment in LNG export projects, mainly targeting Asian and European buyers. The new administration in 2025 has promised supportive policies for oil and gas extraction as part of a broader drive for US energy dominance, that encompasses supplies of uranium, coal, biofuels, geothermal heat, hydropower and critical minerals.
Between 2015 and 2024 the share of annual energy investment going to fossil fuel supply and fossil fuel-based electricity generation declined from 60% to just under 40%. Supply costs for fossil fuels have fallen over this period, but other sources of investment, notably in low-emissions power, grids and end use, have grown rapidly. New investment in manufacturing has been underpinned by competitively priced energy and assisted by policies boosting domestic competitiveness and foreign direct investment. However, the country has welcomed only one new solar cell plant since 2019, whereas imported cells, primarily originating from Southeast Asia, more than tripled in 2024. This example is reflective of the broader challenges of onshoring clean technology manufacturing and efforts to diversify global supply chains for renewables, critical minerals and battery manufacturing.
Cumulative US data centre (DC) investment could reach over USD 2.1 trillion in the next five years, and companies are racing to secure sources of clean electricity while also delivering on their corporate decarbonisation targets. This has led to a boom in the US corporate power purchase agreement (PPA) market with technology and DC companies being responsible for procuring 86 GW of renewable capacity since 2015 to secure power for their investments and obtain renewable energy certificates. US technology companies’ ambitious plans have the potential to materially affect the power sector in various ways. DCs are creating demand for next-generation energy technologies by forming a dedicated market for small modular reactors (SMR) and advanced geothermal plants.
As of Q4 2024 about 26 GW of nuclear – mostly SMR – and 265 MW of advanced geothermal agreements have been reached between US technology companies and developers. This has been enabled by deep financial markets and a domestic venture capital ecosystem, which have helped drive early-stage growth of new technology developers such as TerraPower, X Energy, Fervo Energy and many others. Given its long history with nuclear power, as well as technology and workforce spillovers from its oil and gas sector, the US could emerge as a leader for these technologies with DCs creating a domestic market for innovation and commercialisation.
Latin America and the Caribbean
Clean energy investment in Latin America has grown by nearly 25% in the past decade, highlighting regional progress despite diverse country contexts and transition pathways. The economic landscape varies significantly across Latin America, with similar diversity in the political and energy arenas. This context is further reflected in changes in currency valuation against the US dollar since 2015, which range between -99% and +5.4%, and contrasts in sovereign debt ratings between CCC and A+. Between 2015 and 2025 regional GDP has grown by 15%, driven mainly by Mexico, Colombia, Chile and Costa Rica, which experienced increases of between 10% and 40%. Over the same period, clean energy investment increased by nearly 25%, reaching USD 70 billion in 2025, with Chile, Colombia and Costa Rica accounting for the largest increase, given the doubling of renewable investment flowing into the three countries.
Brazil played a significant role in building momentum behind clean energy investment thanks to the country’s enabling environment for investment in solar PV, wind and bioenergy, further accelerated by the enactment of the Future Fuel Law in 2024. Over the same time horizon, fossil fuel investment has decreased by more than 20%, to over USD 90 billion a year, with Brazil, Argentina and Mexico accounting for almost 70% of this investment. In the STEPS, total energy investment by 2035 increases by around USD 55 billion from 2025, with lower fossil fuel investment offset by an increase in clean energy investment. An even greater shift in investment trends is needed to align with the APS, including significant additional spending on renewables. In the lower fuel demand environment of the APS, fossil fuel investment experiences a decline, while clean energy investment triples from today – including an almost threefold increase in wind generation.
As in many other countries and regions, the resilience of grid infrastructure is a crucial variable for Latin America’s energy future, particularly given the increasing intensity and frequency of extreme weather conditions. The rise in weather-related incidents, which disproportionately affect the most vulnerable households, combined with the projected annual increase in regional electricity demand of 3% to 2050 under the STEPS, underscores the need for enhanced investment and policies to diversify energy resources and establish a reliable and interconnected transmission grid. An integrated electricity network, such as SIEPAC (Central American Electrical Interconnection System), enhances resilience by spreading the risks and impacts of extreme weather events. In support of the creation of SIEPAC, the International Development Bank provided USD 170 million in ordinary and soft loans to power utilities and USD 70 million in concessional finance.
Brazil has implemented almost 350 independent power transmission (IPT) projects, whereby the private sector wins the right to build, own and operate a transmission line. Brazil auctioned over 10 500 km of transmission line rights in 2024, securing nearly USD 4 billion at a 40% discount to the maximum price the regulator was willing to pay. Peru and Chile have also implemented IPTs, with the Peruvian government awarding 14 projects worth over USD 2 billion and Chile tendering over 20 projects valued at over USD 900 million. By 2035, in the STEPS, annual investment in grids needs to more than double to USD 30 billion, with almost USD 20 billion expected from the private sector. Under the APS, investment reaches USD 47 billion. For every dollar of public finance, an estimated USD 4 is mobilised from the private sector.
Despite growing investment, Latin America only accounts for 5% of global clean energy investment from private finance due to high costs and limited capital markets. Addressing investment and financing challenges in Latin America will be essential for the region’s infrastructure development and the prospects for energy transitions. As things stand, Latin America only accounts for 5% of privately financed global investment in clean energy. This reflects several constraints, including high interest rates that governments have introduced to contain inflationary pressures, which deter the financing of capital-intensive clean energy projects. This is also reflected in the lack of long-term finance, with average sovereign debt maturity of 4-6 years in Honduras, Trinidad and Tobago, Venezuela and Bolivia, and an overall increase in public debt servicing costs. These have increased fivefold over the past ten years in Nicaragua and Suriname, while Brazil and Mexico alone account for more than USD 55 billion dollars per year in debt servicing compared to nearly USD 90 billion in total energy investment.
The region’s market capitalisation to GDP ratio is around 36%, compared to 65% in OECD countries. Private investment is mostly concentrated in larger businesses, with development banks playing a crucial role in financing. The region has made strides in Green, Social, Sustainable and other labelled bonds (GSS+) debt issuance, surpassing a cumulative total of USD 250 billion by the end of 2024, led by Chile, Mexico and Brazil. The region successfully issued USD 20 billion in green and sustainable bonds in 2024.
Access the report here
