May 14, 2026 — For every dollar banks headquartered in eight key Asia Pacific economies financed for fossil fuels in 2024, just 83 cents flowed into clean energy supply. This stark figure, revealed in BloombergNEF’s new report, Energy Supply Ratios for Investment and Financing in Asia, underscores a critical disconnect: despite the region being the fastest-growing market for energy transition investment outside of China, capital allocation remains heavily tilted towards traditional energy sources. The ratio, while the highest since 2021, still lags behind the global average of 0.89:1, highlighting an inertia that could have profound financial implications, especially given the renewed focus on energy security following major energy shocks in 2026.
The Stubborn Imbalance in Capital Flows
To truly understand the financial landscape of Asia’s energy sector, one must follow the money. Banks across Japan, South Korea, Taiwan, Singapore, Malaysia, Thailand, Indonesia, and the Philippines collectively facilitated approximately $240 billion in energy supply financing annually between 2022 and 2024. The challenge isn't merely a lack of clean energy investment, but the persistent dominance of fossil fuel financing. While fossil-fuel volumes have declined gradually for these banks, low-carbon transactions have risen only marginally, failing to surpass 2021 levels or outpace fossil-fuel energy supply volumes in 2024. This dynamic points to established financing strategies and real-economy dependencies that are proving difficult to shift rapidly.
The report highlights that the disclosure of these financing ratios, a practice already adopted by global institutions such as JPMorgan Chase, Citigroup, and Scotiabank, offers crucial visibility for investors. It also serves as a valuable internal benchmarking tool for banks navigating the energy transition. Without transparent metrics, the true pace and commitment to decarbonization can be obscured, making it harder for markets to price risk accurately or reward sustainable finance leaders.
Shifting Ratios and Regional Nuances
Despite the overall lagging performance, some regional banks have shown progress. Ratios between low-carbon and fossil-fuel energy supply volumes improved in 2023 and 2024 for banks aggregated by market from Japan, Taiwan, Malaysia, Thailand, and the Philippines. Specific institutions demonstrating this shift include Japan’s MUFG and Mizuho, Taiwan’s Mega Financial Holding, Indonesia’s Bank Mandiri, Malaysia’s Maybank, and Thailand’s Krung Thai Bank and Kasikornbank. These improvements often reflect domestic opportunities, with Japanese banks, for instance, achieving a domestic ratio of 1.27:1, though this was partially offset by fossil-fuel deals in North America and Southeast Asia.
Leading banks from outside the Asia Pacific region, such as Standard Chartered, BNP Paribas, Groupe BPCE, and Deutsche Bank, have also been active in facilitating energy supply financing to Southeast Asian markets. Their involvement indicates that international capital recognizes the region's growth potential, even as local banks grapple with deeply entrenched financing patterns. The modest increase in low-carbon financing was primarily driven by investments in power grid and energy storage projects in 2024, while financing for wind and solar remained broadly flat between 2023 and 2024. Large, specific deals, such as a major solar and battery project in the Philippines, also played a role in boosting low-carbon volumes in certain markets.
The Larger Investment Picture and Climate Imperative
Zooming out, the broader energy transition investment landscape in Asia Pacific markets (excluding mainland China) saw a robust 23% growth in 2025, significantly outpacing the global growth rate of 8%. Yet, the investment ratio still stood at only $1.3 in low-carbon energy supply for every dollar invested in fossil-fuel supply, a figure that pales in comparison to Europe’s 3.5:1. This regional disparity becomes even more stark when considering fossil-fuel imports; South Korea, for example, invested only 11 cents in local clean energy supply for every dollar spent on imported fossil fuels.
Globally, a 4:1 investment ratio between low-carbon and fossil-fuel energy supply is deemed necessary on average across this decade to align with 1.5-degree warming scenarios relative to pre-industrial levels. The Asia Pacific region faces an even higher hurdle due to its structurally lower investment in fossil fuel-producing markets. The BloombergNEF report underscores that while the region is a hotbed for energy transition investment, the actual deployment of capital by its banking sector remains heavily influenced by historical precedents and existing infrastructure, posing a significant challenge to meeting climate targets.
What This Means for Your Wallet
The persistent gap between fossil fuel and clean energy financing in Asia Pacific banks carries direct implications for investors and consumers. For investors, particularly those focused on environmental, social, and governance (ESG) criteria, the ratios highlighted by the BloombergNEF report signal both risk and opportunity. Banks that proactively improve their clean energy financing ratios, like MUFG or Maybank, may be better positioned for a future less reliant on volatile fossil fuel markets. Conversely, those lagging behind could face increasing regulatory scrutiny and stranded asset risks. Consumers in the region, already impacted by energy shocks in 2026, will continue to experience the economic volatility of fossil fuel dependency until capital flows decisively shift. The trajectory of these crucial financing ratios, particularly as they approach the 4:1 target needed for climate alignment, will be the critical barometer for the region’s economic resilience and its commitment to a sustainable future. Investors in financial institutions like JPMorgan Chase and their peers should watch closely for further transparency in their financing disclosures.
