A report by the Council on Foreign Relations
Measuring Global Contributions to Energy Innovation
The Global Energy Innovation Index evaluates how national governments and innovation ecosystems contribute to the development of new energy technologies worldwide. The report analyzes thirty-nine countries using sixteen indicators that measure performance across three critical dimensions of innovation: knowledge creation, market development, and policy support.
Energy innovation plays a central role in addressing global climate change and achieving the United Nations Sustainable Development Goal 7 (SDG7), which calls for affordable, reliable, sustainable, and modern energy for all. However, current energy systems remain heavily dependent on fossil fuels, and technological progress must accelerate if global emissions targets are to be achieved. According to the report, many of the technologies needed to meet net-zero targets are not yet commercially available, highlighting the importance of sustained investment and policy support for energy innovation.
By comparing national performance across innovation systems, the index seeks to identify both strengths and weaknesses in how countries contribute to the global clean-energy transition.
How the Global Energy Innovation Index Is Constructed
The index is built around a systems approach to innovation. Rather than focusing on a single metric, it evaluates how different parts of the energy innovation ecosystem interact. These functions are organized into three subindexes:
Knowledge, Markets, and Policy.
The Knowledge Subindex evaluates scientific and technological output, including research publications, highly cited studies, international collaboration in research, and high-quality patents. These indicators capture how effectively countries generate and disseminate knowledge related to low-carbon energy technologies.
The Markets Subindex measures the ability of national economies to translate knowledge into deployable technologies. Indicators include venture capital investment in clean-energy start-ups, demonstration projects, high-impact cleantech companies, technology exports, improvements in energy efficiency, and adoption of clean energy sources.
The Policy Subindex focuses on government commitments to energy innovation. It examines public investment in low-carbon research and development, regulatory frameworks supporting renewable energy and efficiency, carbon pricing policies, national climate pledges, and international research collaboration.
As shown in the indicator framework presented in the report, the Markets Subindex carries the largest weight in the overall ranking (40 percent), while Knowledge and Policy each account for 30 percent of the final score.
Global Rankings: Europe Leads Energy Innovation
The index reveals a clear geographic pattern in global energy innovation leadership. Scandinavian countries dominate the rankings, with Sweden placed first, followed by Denmark, Finland, and Norway. These countries combine strong research output, active cleantech markets, and supportive policy frameworks.
European nations account for nine of the top ten positions in the index. Canada, ranked sixth, is the only country outside Europe to appear in the top tier. The United States ranks thirteenth, slightly below South Korea.
Among other major economies, Japan ranks seventeenth, Italy twenty-first, and China twenty-ninth. The lower end of the rankings is dominated by middle-income economies such as Brazil, Turkey, India, Mexico, and Indonesia. According to the report, this distribution reflects the principle of “common but differentiated responsibilities” in climate diplomacy, which places greater expectations on high-income countries to drive technological innovation.
The rankings also highlight substantial variation across innovation functions. Some countries perform consistently across all categories, while others demonstrate strong performance in one area but weaknesses in another.
Divergent National Innovation Strategies
One of the report’s most notable findings is the uneven performance of countries across the three subindexes. These variations illustrate how national innovation systems contribute differently to the global clean-energy transition.
For example, Spain ranks ninth overall but performs poorly on knowledge creation while leading the Policy Subindex due to strong public investment and regulatory frameworks supporting clean energy. Conversely, Saudi Arabia ranks highly in the Knowledge Subindex due to research output but performs poorly in policy and market indicators.
The United States presents another example of mixed performance. While it ranks first globally in high-impact clean-energy start-ups and performs strongly in venture capital investment, it ranks extremely low in clean-energy technology exports. This contrast illustrates the strength of the U.S. innovation ecosystem in generating new companies but also highlights structural challenges in scaling manufacturing and exporting clean technologies.
These variations suggest that national innovation systems may complement one another. Knowledge generated in one country can lead to business development in another, while supportive policy frameworks in certain nations help create markets for technologies developed elsewhere.
Policy and Innovation: The Role of Government Leadership
Government policy remains a central driver of energy innovation. Public investment in research, development, and demonstration projects plays a critical role in enabling technological breakthroughs, particularly in areas where private markets provide limited incentives.
The report highlights the importance of carbon pricing mechanisms, energy efficiency regulations, and national climate strategies in stimulating innovation. Countries with strong policy frameworks tend to perform better in deploying clean technologies and building supportive market environments.
In the Policy Subindex rankings, Spain ranks first, followed by France, Austria, and Belgium. These countries demonstrate strong regulatory frameworks and significant investment in energy research and development.
The United States ranks in the middle tier of this subindex, partly due to relatively low effective carbon pricing. Although some states impose carbon prices, the absence of a nationwide policy reduces the country’s overall score in this category.
Reference
Hart, D. M., Cunliff, C., Beams, M., & Subrahmanian, A. (2025). Global energy innovation index. Council on Foreign Relations. https://www.cfr.org/reports/