LONDON (Reuters) - Global investment in low-carbon energy transition exceeded $2 trillion for the first time last year, a report by BloombergNEF showed on Thursday.

WHY IT'S IMPORTANT

Countries around the world are investing in and developing cleaner sources of power and infrastructure to meet climate targets under the Paris Agreement but many experts say the pace is not fast enough.

Global energy transition investment needs to average $5.6 trillion each year from 2025 to 2030 to meet a net zero emissions target by mid-century. Current investment levels are only 37% of what is required to get on track, BloombergNEF's energy annual investment trends report said.

BY THE NUMBERS

Investment in the low-carbon energy transition grew by 11% last year to a record $2.1 trillion, driven by renewable energy, power grids and electrified transport and energy storage investment, according to the report.

However, the pace of growth was slower than in the previous three years when investment grew by 24-29% a year.

The largest market for investment was mainland China, which accounted for $818 billion of investment, up 20% from 2023.

CONTEXT

One of U.S. President Donald Trump's first acts on returning to office last week was to quit the Paris Agreement, which will slow U.S. climate funding internationally and increase the chance of global warming escalating.

KEY QUOTE

"There is still much more that needs to be done, especially in emerging areas like industrial decarbonisation, hydrogen and carbon capture, in order to reach global net-zero goals." said Albert Cheung, deputy chief executive of BloombergNEF.