The transition to renewable energy is not merely an environmental imperative but a fundamental pathway for Africa to achieve sustainable economic growth, enhance energy security and build climate resilience.
This is indicated in the study that was conducted jointly by the Enzi Ijayo Africa Initiative (EIAI) and Africa Climate Insights (ACI), looking into a comprehensive roadmap for accelerating clean energy transition.
The report shows that while Africa has both enormous potential and enormous need to develop renewable energy, a lack of financing is holding back its progress.
“Despite being home to almost 20% of the global population, Africa accounts for just 2% of global clean energy investment, according to IEA estimates for 2025. For every US$1 invested in fossil fuels in Africa, only around 92 cents goes to clean energy, compared to a near 2:1 ratio in favour of clean energy globally.”
According to the study, in order to meet the targets of the Nairobi Declaration, Africa’s renewable capacity must rise by 23% each year between 2022 and 2030. However, it warns, since 2022, yearly growth has averaged 6.2%, necessitating a threefold increase.
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“To fill this gap, Africa must use a wide range of finance tools to scale up private finance for mitigation projects like renewable power, including green guarantees, impact investment, public-private partnerships, green financial instruments like green bonds and sustainability-linked bonds, and blended finance.”
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Case studies: Diverse renewable energy solutions across Africa
The report highlights several successful renewable energy projects across Africa that have been implemented using diverse financial models. It focuses on five case studies, examining their financing structures and overall impact.
Kenya
One such example is the Lake Turkana Wind Power Project (LTWP), Kenya’s largest single private investment to date. Located in the uniquely windy region of Marsabit County, LTWP is a major private-sector renewable energy initiative. With an installed capacity of 310MW generated by 365 wind turbines, the project accounts for approximately 17% of Kenya’s total installed power capacity.
“The LTWP project, costing approximately €625 million, was a prime example of blended finance, which strategically combined concessional funding with commercial capital to de-risk the high-impact venture. The project secured €130 million in equity financing from a mix of public and private investors and debt financing from the African Development Bank (AfDB) and European Investment Bank (EIB).
“LTWP has delivered significant impacts across Kenya. In 2024, it contributed approximately 10.89% of the country’s total power mix and provided over one million homes with 100% renewable energy.”
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Morocco
The study highlights the Ouarzazate Solar Power Station (NOOR Complex) in Morocco, which it says represents a significant milestone in solar power development.
“It is one of the largest concentrated solar power plants globally, with a total capacity of 582MW from both concentrated solar power (CSP), which provides 510MW, and photovoltaic (PV) technologies for the remaining 72MW.
“The NOOR Complex has delivered significant environmental and economic impacts. It offsets approximately 690,000 tonnes of CO₂ emissions annually, directly supporting Morocco’s climate action goals.”
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Nigeria
In Nigeria, the report states that a demand-led approach to solar energy adoption is gaining momentum, particularly as an off-grid solution for both residential households and commercial and industrial users.
“President Bola Tinubu’s first act in office in 2023 was a policy decision to eliminate fuel subsidies, leading to an immediate increase in petrol and diesel prices. Given that an estimated 40% of electricity consumed is from backup generation, this sudden increase in fuel costs fundamentally altered the operational economics for Nigerian businesses and households.
“A key model offered by companies serving the residential and small business market is Pay-As-You-Go (PAYG), which supports these customers to pay for solar systems in small, regular instalments, making clean energy more accessible.”
DRC and Mozambique
Moving to Central and Southern Africa, the study notes that the region is home to some of the world’s most ambitious proposed mega-hydropower projects, aimed at harnessing the vast energy potential of major river systems. Notable examples include the Grand Inga project in the Democratic Republic of Congo (DRC) and the Mphanda Nkuwa project in Mozambique.
The study states that these projects could drive industrialisation, generating long-term economic growth in the region, particularly in the mining sector through local mineral processing.
“The projects are backed by a range of key stakeholders, including governments, private consortia, and multilateral development banks (MDBs) such as the World Bank and AfDB. These projects would address the severe energy deficit in Central and Southern Africa and the need to drive regional economic development and industrialisation.”
South Africa
Lastly, the study highlights South Africa’s deployment of Africa’s largest Battery Energy Storage Systems (BESS) project, marking a critical step toward addressing the country’s persistent electricity crisis.
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“The country’s strategy is twofold: the state-led Eskom BESS Rollout Programme and a competitive tender process for private developers called the Battery Energy Storage Independent Power Producer Procurement Programme (BESIPPPP).
The study indicates that the BESIPPPP has cumulatively procured over 1,744MW of BESS capacity across three bid windows, attracting significant private investment.
“The BESS rollout is already yielding significant impacts. The programmes are creating significant employment opportunities, with the first bid window of BESIPPPP committing to creating 992 jobs, and the third bid window promising 852 jobs.”
Read the Renewable Energy Investment Case for Africa
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