Geopolitics › Global issues & flashpoints › Energy: oil, gas and LNG
Clean-energy race (solar, EVs, batteries)
2010s–· Issue or flashpoint
Widely agreedMost analysts agree.
The race to build and sell solar panels, wind turbines, batteries and electric vehicles, led by China and contested by the US and Europe.
See it on the Geopolitics map →The picture
Clean-energy investment reached about $2.2 trillion in 2025, twice that in fossil fuels, by IEA estimates. China makes over 80% of the world's solar-panel supply, about three-quarters of batteries and most EVs; plug-ins are now roughly half its new car sales, and about a quarter worldwide. The US and EU answered with tariffs, including 100% on Chinese EVs in the US. In 2025 the US also ended EV tax credits and cut renewable-energy credits.
Why it matters
It decides which countries own the industries of a lower-carbon economy and can cut oil-import dependence, making it an energy-security issue as well as a climate one.
Key facts and numbers
IEA World Energy Investment and Global EV Outlook reports, BloombergNEF supply-chain data, tariff notices, and the July 2025 US budget law ending EV credits.
What to watch
Outlook: whether Western tariffs build rival industries or just raise prices, and whether the 2026 oil shock speeds the switch to EVs and renewables.
Connections (3)
▸China's economy: property bust, deflation, export surge dominates manufacturing in Clean-energy race (solar, EVs, batteries)Fact
The relationship
As property collapsed, Beijing steered credit into the 'new three' industries: EVs, lithium batteries and solar panels. Huge state-backed capacity drove prices down; solar module prices roughly halved in 2023, and in 2025 BYD outsold Tesla in battery-electric cars. The overcapacity fuels record exports and trade disputes, but makes clean tech cheaper worldwide.
Since when and why
Factory hubs in Jiangsu, Guangdong and Anhui, under Xi Jinping's push for 'new productive forces' from 2023; EU and US tariffs on Chinese EVs followed in 2024.
How we know
Chinese customs and industry data, IEA and BloombergNEF supply-chain shares, and price indexes showing module and battery costs falling sharply.
What to watch
Debated: whether this is fair competition, as Beijing says, or subsidized dumping, as Western governments say, and whether price wars bankrupt many Chinese producers.
▸Clean-energy race (solar, EVs, batteries) may erode long-run demand in Energy: oil, gas and LNGOutlook
The relationship
EVs, solar and wind displace oil in transport and gas in power. Analysts say China's gasoline demand peaked around 2023 as EVs spread there. If adoption keeps widening, global oil demand could plateau around 2030 and then fall, eroding petrostates' leverage; slower adoption keeps demand rising for longer.
Since when and why
Most visible in China's car market and Europe's power sector; IEA forecasts since 2023 have put a global oil-demand peak near 2030.
How solid?
Outlook, not fact: IEA, OPEC and BloombergNEF scenarios disagree sharply, and past peak-oil forecasts have often been wrong.
What to watch
Whether the 2026 oil shock speeds the switch, as the 1970s shocks spurred efficiency, or US policy and cheaper oil later slow it.
▸Clean-energy race (solar, EVs, batteries) depends on Critical minerals and rare earthsFact
The relationship
A typical electric car needs about six times the minerals of a conventional one, mainly lithium, nickel, cobalt, manganese and graphite, and EV motors and wind turbines use rare-earth magnets. So the clean-energy race is also a mining and refining race, and China's processing dominance gives it leverage over others' transitions.
Since when and why
Supply chains run from mines in Australia, Chile, Congo and Indonesia to refineries and battery plants largely in China; the IEA flagged the risk in 2021.
How we know
The IEA's 2021 report on critical minerals and its annual Global Critical Minerals Outlook, plus manufacturers' material disclosures.
What to watch
Whether new battery chemistries, such as sodium-ion, and recycling ease demand for scarce minerals, and how quickly.