Fuel costs for generating natural gas- and coal-fired electricity surged in 2021 but should taper off in the coming years, the International Energy Agency (IEA) predicted in its latest semi-annual Electricity Market Report.

“Sharp spikes in electricity prices in recent times have been causing hardship for many households and businesses around the world and risk becoming a driver of social and political tensions,” said IEA Executive Director Fatih Birol.

Citing a “rapid economic rebound” and “more extreme weather conditions than in 2020,” IEA said that global electricity demand rose 6% last year. The report said the year/year increase equates to more than 1,500 terawatt-hours of electricity generation.

Coal-fired power generation rose by 9% last year, buoyed by...