China became the leading country for attracting energy transition investment in 2022, according to a new report from research firm BloombergNEF (BNEF). It accounted for $546 billion or nearly half of the global total of $1.1 trillion - a new record and an increase of 31% year-on-year.
The US was a distant second at $141 billion, while the EU would have been second if treated as a single bloc, at $180 billion. Germany retained its third place, while the UK dropped one place to fifth as France climbed to fourth.
The energy crisis and policy action drove faster deployment of clean energy technologies.
Energy Transition Investment Trends is BNEF’s annual accounting of how much funding businesses, financial institutions, governments and end-users are committing to the low-carbon energy transition.
Almost every sector covered in the report achieved a new record level of investment in 2022, including renewable energy, energy storage, electrified transport, electrified heat, carbon capture and storage (CCS), hydrogen and sustainable materials. Only nuclear power investment did not set a record, staying broadly flat.
Electrified transport, which includes spending on electric vehicles and associated infrastructure, came close to overtaking renewables, with $466 billion spent in 2022 - an impressive 54% increase year-on-year.
Renewable energy, which includes wind, solar, biofuels and other renewables, remained the largest sector in investment terms, achieving a new record of $495 billion committed in 2022, up 17% from the year prior.
In another first, investment in low-carbon technologies appears to have reached parity with capital deployed in support of fossil fuel supply.
Hydrogen is the sector that received the least financial commitment at just $1.1 billion in 2022 (0.1% of the total), despite strong interest from the private sector and growing policy support. Hydrogen is, however, the fastest-growing sector with investment more than tripling over the year before, according to BNEF.