The world’s largest two economies, the United States and China, are both majorly cooling off on investments in clean energy manufacturing, but for very different reasons. In China, the decline in investing from peak levels in 2023 reflects a market correction after years of oversupply and a slowdown in economic growth. In the United States, the trend comes as a reflection of shifting policy priorities and the private sector’s reaction to political uncertainty in the Trump era. The result is a slowdown in clean energy manufacturing investing on a global level at a time when energy diversification and decarbonization has never been more urgent.

A new Rhodium Group report shows that, on a global level, investment in clean technology manufacturing has dropped a whopping 42 percent since their peak in 2023, reaching $155 billion in 2025. China alone has seen a 70 percent decline in its investing levels since its frenzied spending spree in 2023, when Beijing commissioned as much solar power as the rest of the world combined in 2022. While much of this decline is a natural correction to previous oversupply due to major government incentives, China’s cooldown is also a reaction to the United States’ political pivot away from clean energy, most notably wind and solar power.

According to reporting from the nonpartisan news outlet Semafor, “Chinese companies in the green sector scrapped roughly $2.8 billion in planned US manufacturing projects last year, while more than half of proposed investments were canceled, paused, or delayed.” This pullback comes in direct response to a shift in policy under the Trump administration, most notably the rollback of the Biden-era Inflation Reduction Act, the cancellation of many clean energy tax incentives, and tariffs on clean energy supply chains, especially those coming out of China (which is to say, most of them).

There is a certain degree of irony in the mirrored clean energy spending trends taking place in the United States and China, which have taken opposition positions and strategies when it comes to establishing global energy market dominance and shoring up their respective national energy securities. While China is now slowing down on clean energy, the nation is by no means shying away from clean energy. China wants, in no uncertain terms, to become the world’s first electro-state, while the U.S. is digging its heels in as a petro-state under the guidance of the Trump administration.

But while the world’s largest economies are majorly slowing their spending on clean energy manufacturing, many nations are investing in clean energy more than ever before. In fact, the energy crisis stemming from the United States’ and Israel’s war in Iran is pushing a clean energy boom in many nations, and especially in emerging economies. As oil and gas prices soar, many countries are looking to domestic wind and solar power to provide cheaper and more reliable energy.

“Wind and solar cannot be embargoed, blockaded, or shut off by a foreign power,” David Frykman, General Partner at Stockholm-based venture capital group Norrsken, wrote in a March op-ed for Fortune. “Every terawatt-hour of domestic renewable generation is a terawatt-hour that no adversary can weaponize.”

So while the overall global trend in clean energy manufacturing is slowing down, the total picture is far more nuanced. In some economies, albeit smaller and less powerful ones, clean energy manufacturing has never been stronger. In others, the nature of clean energy spending is simply shifting away from manufacturing and toward infrastructure.

Overall, however, these divergent trends showcase the fact that the current clean energy landscape is extremely volatile at a global level. Uncertainty over economic and political factors is kneecapping investor interest and introducing a high level of risk aversion in the sector at a time when clean energy expansion is sorely needed to give resilience to global energy systems and to limit climate impact at a time when energy demand projections are skyrocketing on the back of the AI boom.

By Haley Zaremba for Oilprice.com

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