Towards a green China: energy policy, technological innovation, and green investment as drivers of environmental sustainability

China’s pursuit of environmental sustainability has become one of the defining policy experiments of the twenty-first century, combining an ambitious dual-carbon pledge with the world’s largest deployment of clean-energy technology and green capital. This review synthesizes recent scholarship to examine how three interlocking levers, energy and climate policy, technological innovation, and green investment, jointly shape China’s transition toward a lower-carbon and more resilient development path. Drawing on a structured reading of peer-reviewed research published predominantly between 2019 and 2025, the article develops an integrated framework in which policy sets direction and incentives, innovation lowers the cost and expands the frontier of abatement, and investment mobilizes the capital required to translate intent into installed capacity. The evidence indicates that target-based governance, embodied in successive Five-Year Plans and the 2030/2060 carbon commitments, has been reinforced by market-based instruments such as the national emissions trading system, and by an expanding architecture of green credit and green bonds. Technological progress in solar photovoltaics, wind power, batteries, and electric mobility has driven steep learning curves, allowing renewable additions to exceed fossil capacity additions by wide margins in recent years. Green finance is shown across numerous provincial and firm-level studies to reduce carbon-emission intensity, chiefly by catalyzing green technological innovation and by reallocating capital away from pollution-intensive activities. Nevertheless, persistent tensions remain, including coal lock-in, energy-security concerns, uneven regional capacity, intensity-based rather than absolute caps, data-quality risks, and the danger of greenwashing. The review argues that the effectiveness of any single lever is conditional on its coherence with the others, and that spatial spillovers and regional heterogeneity mediate outcomes in ways that generic national narratives obscure. Case evidence is integrated throughout to ground the analysis in concrete provincial, sectoral, and corporate experience. The article closes by identifying priorities for policy design and an agenda for future research on the policy–innovation–investment nexus.