What is the financial gap between fossil fuels and sustainable energy?

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A Significant Financial Disparity Exists Between Fossil Fuel and Sustainable Energy Investments by Major Banks

Between 2021 and 2024, the world's 65 largest banks allocated US$3.285 trillion to fossil fuels, a sum more than double the US$1.368 trillion provided for sustainable alternatives like solar and wind power. This imbalance means that for every dollar invested in fossil fuels, only 42 cents were directed towards renewable energy sources and related infrastructure.
Fossil Fuel Financing Outpaces Renewables

The study highlights a substantial financial commitment to fossil fuels by major global financial institutions. Over the three-year period from 2021 to 2024, the top 65 banks collectively provided US$3.285 billion for fossil fuel projects. This figure significantly dwarfs the amount dedicated to sustainable energy, underscoring a continued reliance on traditional energy sources within the global financial system.
Sustainable Energy Investment Trails Behind

In contrast, the same cohort of banks allocated only US$1.368 billion to sustainable power generation, including solar, wind, and associated infrastructure between 2021 and 2024. This disparity indicates that while investments in renewables are occurring, they are not keeping pace with the financing provided for fossil fuels, a critical point in the global energy transition.
Regional Concentration of Sustainable Finance

The investment in sustainable alternatives is not evenly distributed globally. The analysis reveals that 93% of the financing allocated to sustainable alternatives is concentrated within Organisation for Economic Cooperation and Development (OECD) countries and China. This geographic concentration suggests that regions with greater financial capacity are driving the bulk of sustainable energy investments, potentially leaving other parts of the world underserved.
North American Banks Show a Wider Gap

Banks based in the United States and Canada demonstrate a particularly pronounced financial gap, providing four times more finance for fossil fuels than for sustainable alternatives. While institutions in Asia and Europe showed better performance compared to their North American counterparts, their funding levels for the energy transition were still considered well below what is required.

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What is the financial gap between fossil fuels and sustainable energy?

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