Green ETFs to Watch as Global Energy Transition Investment Crosses $2T

A torrent of global capital is reshaping the world’s energy systems, pushing investment in the low-carbon transition to a record $2.3 trillion in 2025, as per data published by the latest Energy Transition Investment Trends report from BloombergNEF (“BNEF”). This staggering investment, reflecting an 8% annual increase, demonstrates formidable momentum despite regional policy shifts. 

While electrified transport took the lead, renewable energy investment remained a cornerstone of this growth, injecting $690 billion into the global energy transition space. 

This sustained momentum puts a bright spotlight on clean energy exchange-traded funds (ETFs), which offer investors a diversified gateway into a sector that is increasingly outpacing fossil fuel spending, enabling them to participate in this multi-trillion-dollar structural trend with a less risky approach. 

Before suggesting a few such ETFs for your watchlist, let’s delve deeper into the trends driving this record investment and explore the growth prospects of the clean energy industry, so you can make an informed decision.

Global Resilience Amid Regional Shifts

The path to $2.3 trillion was not uniform. The global investment surge occurred despite a cooling climate for renewables in the world’s two largest economies. In the United States, investment grew a modest 3.5% to $378 billion, as the industry faced an unfavorable regulatory environment. Pro-carbon policies under the current administration led to the repeal of several clean energy tax credits via the One Big Beautiful Bill Act (OBBBA) in July 2025 and the cancellation of major offshore wind permits.

Similarly, China, while remaining the global leader with $800 billion in total transition spending, saw its first decline in renewable energy funding since 2013 due to new power market regulations that introduced pricing uncertainty for developers. 

However, a massive 18% investment spike in the European Union and a 15% rise in India, with Asia Pacific accounting for 47% of the global total and emerging as the largest region for investment, outweighed the U.S. and China slack, contributing to the entire surge worldwide. 

This dynamic underscores a critical insight — the energy transition is now a diversified, global movement no longer dependent on a single region's policy cycle.

A Robust Outlook

The momentum witnessed in the clean energy industry is only expected to accelerate, keeping the growth outlook for this space robust. Notably, the International Energy Agency (“IEA”) announced in its October 2025 report that it expects global renewable power capacity to double by 2030, increasing by 4,600 gigawatts (GW). On the other hand, BNEF estimates that annual transition investment will need to average $2.9 trillion over the next five years to stay on track for climate goals. 

To this end, BNEF analysts have identified two primary catalysts expected to continue driving investment in the energy transition space: energy security and the global data center buildout. As nations seek to secure domestic supply chains and reliable power, investment in grids, storage, and renewables will remain a strategic imperative. Concurrently, the explosive demand from artificial intelligence and computing is driving an estimated half-trillion dollars in data center investment annually, creating an unprecedented anchor demand for clean, reliable electricity.

These trends are thus expected to sustain investment flows in companies involved in the global energy transition, ranging from renewable power generation and equipment manufacturing to grid infrastructure, energy storage, electric vehicles, and the critical technology providers inherent to the clean energy industry.

Clean Energy ETFs to Watch

For investors looking to capitalize on this sustained growth without picking individual winners, clean energy ETFs, like those mentioned below, offer a strategic solution. They provide instant diversification across the key verticals identified above — renewables, grid infrastructure, energy storage and electric transport.

iShares Global Clean Energy ETF ICLN

This fund, with net assets worth $2.17 billion, offers exposure to 102 companies that produce energy from solar, wind, and other renewable sources. Its top three holdings include: Bloom Energy BE (10.91%), a fuel cell technology proprietor, Nextpower (NXT) (9.63%), a smart solar tracker manufacturer, and First Solar FSLR, a prominent solar panel producer. 

ICLN has surged 66.8% over the past year. The fund charges 39 basis points (bps) as fees. It traded at a good volume of 4.69 million in the last trading session.

ALPS Clean Energy ETF ACES

This fund, with net assets worth $122.9 million, offers exposure to a diverse set of U.S. and Canadian companies involved in the clean energy sector, including renewables and clean technology. Its top three holdings include Albemarle Corp. ALB (6.60%), a supplier of critical lithium compounds used in energy storage batteries; NXT (5.94%); and Enphase Energy ENPH (5.80%), a leading manufacturer of solar microinverters that also provides energy storage management solutions.

ACES has soared 44.3% over the past year. The fund charges 55 bps as fees. It traded at a good volume of 0.08 million in the last trading session.

Invesco WilderHill Clean Energy ETF PBW

This fund, with a market value worth $784.4 million, offers exposure to 63 stocks of companies that are publicly traded in the United States and engaged in the business of advancing cleaner energy and conservation. Its top three holdings include BE (2.41%), Lithium Argentina LAR (2.22%), a significant developer and producer of lithium projects, and Lifezone Metals LZM (2.11%), which uses its proprietary Hydromet Technology to produce lower-carbon metals.

PBW has rallied 82.8% over the past year. The fund charges 64 bps as fees. It traded at a good volume of 0.71 million in the last trading session.

SPDR S&P Kensho Clean Power ETF CNRG

This fund, with assets under management (AUM) worth $215.3 million, offers exposure to 43 companies whose products and services are driving innovation behind the clean energy sector, which includes the areas of solar, wind, geothermal, and hydroelectric power. Its top three holdings include: BE (4.08%), T1 Energy TE (3.85%), an energy solutions provider, and NXT (3.35%). 

CNRG has rallied 67.3% over the past year. The fund charges 45 bps as fees. It traded at a good volume of 0.01 million in the last trading session.

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