However it is calling on governments and the private sector to spend more on clean energy technologies to meet the goals of the Paris Agreement. 

The Agency released its World Energy Investment 2021 report this afternoon, which highlightyed that global power sector investment is set to increase by around 5% in 2021 to more than US$820 billion - the highest level ever. 

It noted renewables are dominating investment in new power generation and are expected to account for 70% of the total investment this year.

The IEA estimates that for every dollar spent on solar pv deployment today four times more electricity is produced compared to a decade ago, thanks to the greatly improved technological developments and falling costs. 

"The rebound in energy investment is a welcome sign, and I'm encouraged to see more of it flowing towards renewables," IEA executive director Dr Fatih Birol said. 

"But much greater resources have to be mobilised and directed to clean energy technologies to put the world on track to reach net-zero emissions by 2050

"Based on our new Net Zero Roadmap, clean energy investment will need to triple by 2030."

Upstream oil and gas investment is expected to rise by around 10% in 2021 as companies recover financially from the shocks of last year, but their spending remains well-below pre-crisis levels. 

The IEA noted the majors are holding oil and gas spending flat on aggregate in 2021, despite recovering prices, highlighting companies' diverging strategies as they figure out how to remain relevant and resilient in a decarbonising world. 

IEA analysis last year highlighted that only around 1% of capital spending by the industry was going to clean energy investments. But project tracking to date in 2021 suggests that this could rise to 4% this year for the industry as a whole, and well above 10% for some of the leading European companies.

Closer to home, the IEA noted Australia's waning sanctioned LNG capacity, and annual investment spending on sanctioned projects, with the bulk being taken up by the Middle East and North America, a far cry from Australia's boom time LNG investment and construction period in the first half of the 2010s. 

 

However Australia was one of the top contenders for battery storage investment, both grid-scale and behind the metre, in 2021, in a field that was dominated by the US, Europe and China.

The Australian government, alongside Japan, Korea and New Zealand came in equal fourth on committed funding to energy research and development, behind China, North American and Europe. 

The IEA noted new climate policy measures and investment in emerging technologies such as CCUS and hydrogen from governments needed to come to the fore and highlighted financial markets were showing encouraging signs of clean energy investment, but said more was needed to put the energy system on a sustainable path. 

"Governments need to go beyond making pledges to cut emissions and take concrete steps to accelerate investments in market-ready clean energy solutions and promote innovation in early-stage technologies," Birol said. 

Last month the sector was rocked when the IEA said all new coal, oil and gas projects should cease if the world is to reach net-zero emissions by 2050.

The agency caveated saying oil and gas will still be needed, but less and less so compared today as the transition unfolds.