Despite the continuous rise in greenhouse gas emissions, 2025 marked a year of significant advancements in climate action and investment. Global investment in clean energy is projected to reach a record of $2.2 trillion, according to research from the Energy & Climate Intelligence Unit (ECIU), a London-based nonprofit. This surge comes as countries struggle to meet their climate pledges, raising concerns about the effectiveness of current efforts to combat catastrophic climate change.
Gareth Redmond-King, the international lead at ECIU, acknowledged the mixed results. “Is this enough to keep us safe? No, it clearly isn’t,” he stated. “Is it remarkable progress compared to where we were headed? Clearly, it is.” The year also saw remarkable growth in renewable energy capacity and technological advancements that support climate resilience.
Clean Energy Investment Surges
Investment in clean technologies outpaced funding for fossil fuel projects by a significant margin. For every $1 directed towards fossil fuels, $2 was invested in clean energy, according to ECIU data. For major polluters like China, the EU, the U.S., and India, the ratio was even more impressive at $2.60 for every dollar spent on fossil fuels.
The first half of 2025 saw renewable energy investments reach $386 billion, a 10% increase from the same period in 2024, as reported by BloombergNEF. Solar and wind energy met all new global electricity demands during the first three quarters of the year. The UK-based think tank Ember forecasts an 11% increase in renewable capacity compared to 2024, which could see the world on track to triple clean power by 2030, as set out at the COP 28 conference in Dubai.
China has been a pivotal player in this clean energy boom, expected to account for 66% of new solar capacity and 69% of new wind energy globally in 2025, according to Ember. Other regions, including parts of Asia, Europe, and South America, have also made strides in renewable energy.
Technological Innovations and Adaptation Strategies
The rise of artificial intelligence (AI) has reinvigorated investments in green technology, marking a turnaround for the sector. In 2025, global clean tech investments—dominated by funding for next-generation nuclear reactors and renewable technologies—surpassed all of 2024’s totals. This marks the first annual increase since the sector’s peak in 2022.
The S&P’s main clean energy index has increased by approximately 50% this year, outperforming many other stock indexes. This enthusiasm has also stimulated investments in upgrading the power grid, which is crucial for a successful energy transition. AI’s role extends beyond investment; it enhances climate solutions and accelerates scientific research. For example, self-driving electric vehicles utilize AI for route optimization, while AI-enabled scanning systems help inspect critical infrastructure against extreme weather.
Battery prices, a significant barrier to electrification, have also seen a decline. In 2025, prices per kilowatt-hour fell by 8% to a record $108, with expectations of further reductions in the coming year. This trend results from improved manufacturing processes and a surplus of production, benefiting a range of electric products from lawn mowers to commercial drones. The U.S. Energy Information Administration estimates that 18.2 gigawatts of storage capacity will be added in 2025, a 77% increase from the previous year.
Internationally, the climate landscape underwent significant changes despite setbacks in U.S. policy. The High Seas Treaty is set to come into force in January 2026, providing a framework to protect the majority of the world’s oceans. This treaty mandates environmental impact assessments for activities in international waters and paves the way for establishing marine protected areas.
Additionally, the International Court of Justice issued an advisory opinion emphasizing that countries could violate international law by failing to limit global warming to the 1.5°C threshold established at the Paris climate conference in 2015. This ruling empowers NGOs and advocates to hold governments accountable for their climate commitments.
Amid these developments, adaptation strategies gained traction. The Bill & Melinda Gates Foundation announced a commitment of $1.4 billion over four years to enhance resilience for farmers in Africa and Asia. Furthermore, the latest UN climate summit reached an agreement to triple adaptation finance to $120 billion annually by 2035.
The devastating impact of Hurricane Melissa, which claimed lives and severely affected Jamaica’s economy, highlighted the importance of disaster preparedness. The storm triggered a full payout of Jamaica’s $150 million catastrophe bond, demonstrating the effectiveness of such financial instruments in mitigating climate risks.
North Carolina also introduced innovative catastrophe bonds that incentivize adaptation by returning funds to the issuer when no major losses occur. This model attracted $600 million in investor interest, further supporting resilience initiatives.
In summary, while challenges remain in the fight against climate change, 2025 showcased significant advancements in clean energy investment, technological innovation, and international cooperation. As the world grapples with the escalating impacts of climate change, these developments provide a glimmer of hope for a more sustainable future.