The latest data from the International Energy Agency (IEA) shows that global energy consumption grew significantly in 2024, increasing by 2.2% — almost twice the pace observed over the past ten years. This rise was largely driven by soaring electricity demand, spurred by extreme weather conditions, industrial activity, and ongoing advances in electric transport and digital infrastructure.

Although developing nations contributed the largest share of this growth, energy demand in Europe also saw a notable rebound — marking its first year of growth since 2017. This turnaround comes after multiple years impacted by pandemic aftershocks, unstable energy markets, and renewed policy attention to efficiency and climate goals.

Much of this additional energy need was met through low-carbon sources, highlighting the growing significance of renewables in balancing supply with climate commitments. IEA Executive Director Fatih Birol noted that the expansion of technologies such as solar, wind, nuclear and electric vehicles is “increasingly breaking the traditional link between economic expansion and rising emissions.” The IEA also estimates that clean energy has helped prevent roughly 2.6 billion tonnes of CO₂ emissions per year since 2019.

Green Investment Continues to Accelerate

Spending on clean energy infrastructure and technologies has scaled up alongside rising global energy demand. In 2024, capital flows into the energy transition reached a record US$2.1 trillion, according to BloombergNEF. Investment in renewables and other low-carbon technologies now exceeds fossil fuel funding by a factor of nearly two to one.

A large share of this funding was allocated to electric mobility, clean power generation, and upgrades to electricity networks. Together, these three areas made up more than 85% of the total global investment in the energy transition last year. While the pace of investment growth has moderated compared to 2022 and 2023, the data suggests the sector is entering a more mature phase focused on large-scale deployment and infrastructure integration.

Europe’s Role in ESG and Sustainable Finance

Despite macroeconomic pressures and rising capital costs, Europe continues to lead in ESG-focused investment strategies. According to Morningstar, over 80% of global sustainable fund assets are currently held in Europe. At the end of 2024, sustainable fund assets worldwide reached an estimated US$3.2 trillion, setting a new all-time high and reinforcing Europe’s dominant position.

This leadership is supported by a regulatory environment that encourages transparency, corporate sustainability reporting, and the adoption of EU Taxonomy-aligned investment practices. Financial institutions and asset managers are increasingly allocating capital not just for returns, but for measurable environmental and social outcomes.

Ovik Mkrtchyan on Clean Energy as an Investment Imperative

Ovik Mkrtchyan, the founder of Gor Investment Limited, sees sustained momentum behind clean energy investment as a logical outcome of long-term market and environmental trends.

“Despite challenges associated with increased financing costs and economic headwinds, investments into clean energy technologies continue to grow in Europe and worldwide, and with good reason,”

says Ovik Mkrtchyan.

“Demand for energy is increasing but the supplies need to be made less environmentally damaging as urgently as innovation and investment will allow.”

A seasoned investor and entrepreneur, Ovik Mkrtchyan is known for connecting finance, innovation, and sustainability. In addition to his focus on clean energy, he has supported initiatives in public health, industrial modernisation, and sustainable infrastructure across Europe and Central Asia. His investment approach combines in-depth market analysis with a long-term commitment to both economic resilience and environmental progress.

Ovik Mkrtchyan believes ESG funds will continue to outperform in terms of both financial and societal returns.

“We believe very strongly in the potential of ESG funds to deliver good returns but also to help make the world a better, cleaner, more environmentally sustainable place. And against a backdrop of growing energy demand, in Europe and elsewhere, there is also a clear and urgent need for clean and green energy tech projects to get the investment support they need.”

Scaling for Net Zero

While current investment levels are encouraging, both the IEA and BloombergNEF warn that they fall well short of what is needed from a net zero perspective. Indeed, BloombergNEF estimates that clean energy investment must rise to an annual average of US$5.6 trillion by 2030 to remain on course to hit targets aligned to the international Paris Agreement framework.

With Europe retaining a strong position in ESG finance, the challenge for policymakers, asset managers, and industrial players will be to close that funding gap by scaling up deployment and reducing barriers to investment in emerging technologies.

As capital increasingly flows toward sustainability-aligned sectors, the intersection of financial innovation and industrial decarbonisation will continue to define Europe’s role in the global energy transition.

Featured image credit: image from pixabay