Vitality storage and battery applied sciences have moved to the forefront of innovation within the world vitality trade, underscoring how vitality safety has overtaken affordability and decarbonisation because the main driver of innovation within the sector.
That’s the headline conclusion of a brand new report at present from the Worldwide Vitality Company (IEA), which reveals that not solely did battery improvements safe an unprecedented share of patents for any single expertise worldwide in 2023 – at 40 per cent – however that preliminary knowledge signifies that share is prone to have expanded additional nonetheless in 2024 and 2025.
The findings are set out within the influential company’s second annual ‘State of Vitality Innovation’ report, which highlights greater than 150 expertise breakthroughs within the sector final yr, spanning solid-state air-con, perovskite photo voltaic cells, fusion vitality, sodium-ion batteries and next-generation geothermal methods.
These advances contributed to 50 upgrades in expertise readiness ranges amongst rising vitality applied sciences tracked by the IEA, with the world’s vitality innovation panorama getting into a brand new part formed by vitality safety, industrial competitiveness and infrastructure resilience, in line with the report.
As such, vitality applied sciences reminiscent of batteries, transformers, generators, motors and warmth exchangers now symbolize multi-trillion-dollar world markets, with round one-in-ten patents worldwide regarding vitality – greater than for chemical substances, prescription drugs or transport, underlining the vitality sector’s central function in nationwide safety, industrial technique and financial efficiency, the report claims.
On the subject of vitality storage improvements, China, South Korea, and Japan stay main sources of lithium-ion battery patents, with China’s share rising sharply over the previous decade, in line with the report.
In photo voltaic innovation, in the meantime, patenting has shifted towards perovskite photo voltaic cells, which now account for greater than 70 per cent of photo voltaic cell patents by materials.
Regardless of such innovation breakthroughs, nonetheless, the report notes that greater rates of interest, macroeconomic uncertainty and powerful competitors from synthetic intelligence (AI) ventures are more and more weighing on vitality capital flows.
As an illustration, it discovered that public spending on vitality R&D fell by two per cent to an estimated $55bn in 2025, whereas company R&D development eased to at least one per cent in 2024 – slower than in any yr since 2015, apart from 2020 when exercise was disrupted by the Covid-19 pandemic.
Enterprise capital funding in vitality expertise start-ups additionally fell for the third consecutive yr to $27bn in 2025, in line with the report. In the meantime, the share of world VC funding directed to AI rose to nearly 30 per cent in 2025, whereas vitality’s share declined.
Even so, the report particulars how funding for fusion, nuclear fission, important minerals, geothermal, carbon dioxide removing and low-emissions trade has nonetheless expanded sharply since 2021, offsetting a lot of the decline in electrical mobility funding.
The IEA mentioned that regional approaches to vitality innovation have been additionally changing into more and more distinct, with China persevering with to broaden its footprint throughout company R&D and patenting – notably in vitality storage and industrial effectivity – because the nation’s worldwide patent purposes have been rising sharply lately.
On the identical time, the IEA mentioned Europe’s public vitality R&D seems to be nearing the report highs recorded within the Eighties and that – at round 0.08 per cent of GDP – it now exceeds that of different main superior economies.
The USA stays a worldwide chief in VC exercise, in the meantime, accounting for almost half of vitality VC in 2025, whereas Japan stays extremely specialised in batteries and has made progress in advancing in perovskite photo voltaic, hydrogen-based fuels and fusion, the report states.
Amid shifting coverage priorities and tighter monetary situations, the report confused that sustained, well-targeted public assist in addition to alignment with broader financial competitiveness and resilience objectives stay important for clear vitality innovation.
Furthermore, making certain entry to funding throughout all phases of improvement – particularly as non-public capital turns into extra selective – and reinforcing partnerships throughout analysis, trade and finance is prone to be key to sustaining momentum, it added.
“Vitality innovation has grow to be a strategic precedence for governments around the globe,” mentioned Fatih Birol, the IEA’s government director. “With vitality safety and industrial competitiveness on the high of the agenda, nations that maintain funding in analysis, demonstration and early deployment might be greatest positioned to guide the subsequent technology of vitality applied sciences.”
At present’s report builds on the IEA’s evaluation of the worldwide battery market final yr, which discovered annual battery demand elevated considerably in 2024, surpassing the “historic milestone” of 1 terawatt hour.
The report added that world battery manufacturing capability reached 3TWh in 2024 and forecast that the subsequent 5 years might see one other tripling of manufacturing capability if all introduced initiatives are constructed.
The report’s findings additionally observe warnings by Birol in October that though the world could also be on the cusp of an “age of electrical energy” pushed by renewable vitality and a worldwide clear tech growth, the clear vitality transition is being hampered by a “darkish and lengthy” geopolitical shadow.
Need to higher perceive what’s going on on the slicing fringe of sustainability? Turn into a BusinessGreen member – try our membership choices right here
