Countries around the world have ramped up the energy transition, with investments in clean energy posting “impressive growth” in recent years, but rising costs and expensive capital are posing issues to some projects, according to the International Energy Agency (IEA).

In its new report, the agency said that renewable power has been leading the investments, citing that annual spending on solar PV and wind energy initiatives has climbed by more than $300 billion in the last five years alone.

Renewable power now accounts for a third of the $1.8 trillion that was expected to go to clean energy investments last year.

However, while the sector has shown resilience in recent years, the IEA warned that there have been “signs of strain”, especially in the wind sector.

Among the challenges faced recently are higher financing costs and prices of raw materials, which could delay some projects.

“Project commitments and economics have been upset by higher financing costs and higher input costs for key raw materials… This has led wind power developers to request price negotiations to accommodate higher costs, and in some cases to project delays and cancellations,” the report said.

“It has also sapped willingness to bid in new auctions where the price expectations are not aligned with today’s costs.”

In the wind offshore sector, the agency noted that 12 GW of offshore wind capacity is facing delays or cancellation in the UK and US alone.

Price and financing pressures are also affecting the solar PV industry, with developers dealing with higher borrowing costs.