Investment in the clean energy industry is starting to increase after two years of decline, according to a new study.

That’s largely due to growth in China and Japan, analysts at Bloomberg New Energy Finance (BNEF) said.

Globally, around $175 billion was invested in clean energy projects in the first nine months of 2014 – a 16% rise compared to the same period last year.

China set a new record in the third quarter of 2014 by investing $12 billion in solar power, a big leap from the $7.5 billion committed last year in the third quarter.

Total solar installations in the country are expected to reach around 14GW by the end of this year – or nearly a third of the world’s total.

Japan also saw a 17% rise in clean energy investment in the third quarter at $8.6 billion – again due to the growth of solar plants.

Michael Liebreich, Chairman of the advisory board at BNEF said: “It is heartening to see investment heading for an up-year in 2014 after two down-years, thanks in large part to the greatly enhanced competitiveness of solar and to some extent wind.

“However, there is no room for complacency… There is still too much policy instability holding back investor confidence.”

Europe however committed just $8.8 billion in the same period – down from $12.1 billion a year ago. Investment in the UK and Italy dropped 74%.