The world faces more years of high energy prices and emissions unless the electricity sector changes faster after demand hit a record last year, according to the International Energy Agency (IEA).

The economic recovery from the Covid pandemic, combined with unusual weather conditions, caused electricity demand to jump by more than six per cent in 2021, the largest increase since 2010, the IEA said.

In absolute terms, the increase of more than 1,500 terawatt-hours was the largest ever, the Paris-based agency said in its semi-annual Electricity Market Report.

This pushed prices to unprecedented levels while emissions from the electricity sector rose by seven per cent in 2021 – an all-time high after having decreased the previous two years, the IEA said.

While renewable power experienced "impressive growth", electricity generation from coal and natural gas hit record levels, the report found.

IEA executive director Fatih Birol said emissions from electricity must fall by 55 per cent by 2030 if the world is to meet a target of net-zero carbon emissions by 2050.

"But in the absence of major policy action from governments, those emissions are set to remain around the same level for the next three years,” Birol said in a statement.