Africa’s next generation of power projects is increasingly centered on solar, wind power, and battery storage, marking a significant shift away from traditional coal and large hydropower dams. This pivot is driven by the pursuit of cheaper, faster, and more reliable electricity, according to industry leaders and recent data.
Governments and investors across the continent are re-evaluating their energy strategies. A notable example is the $1.5 billion energy agreement between China and Zambia, announced in early May. While this deal includes three separate 300-megawatt projects spanning solar, wind, and coal-fired power, the inclusion of renewables highlights a broader trend. African nations, grappling with rising fuel import bills due to global events like the Iran war, unreliable grids, and increasing industrial demand, are finding renewable energy projects more appealing due to their quicker deployment and lower costs compared to conventional plants.
Investment Shifts and Project Pipeline
The changing investment landscape is evident in project announcements. Of the 322 energy projects declared across Africa in 2025, solar projects dominated with 173, followed by hydropower at 46, wind at 34, gas at 22, and hybrid energy projects at 14, according to the energy research firm Electron Intelligence. This data underscores a clear preference for clean energy solutions.
Mugwe Manga, climate finance lead at FSD Kenya, emphasized Africa’s pivotal role in the global energy transition. “Africa is not on the periphery of the global energy transition, it is sitting at its center,” Manga stated. He added, “The continent holds the world’s best renewable resources, and the economics have now decisively turned in favor of clean energy.”
The continent saw a record addition of 11.3 gigawatts of renewable energy capacity in 2025, tripling the previous year’s figures, as reported by the International Renewable Energy Agency. South Africa, Egypt, and Ethiopia were key contributors to this growth.
Economic Advantages and Deployment Speed
The economic viability of renewables has dramatically improved. Utility-scale solar power costs have plummeted by nearly 90% globally since 2010, while onshore wind costs have fallen approximately 70%. This makes renewables the most cost-effective source for new electricity generation in many African markets.
Matt Tilleard, CEO of CrossBoundary Energy, which invests in renewable energy across Africa, affirmed this trend. “Renewable energy is now unequivocally the fastest, cheapest, and most bankable way to connect people, companies and economies to the megawatts they need to grow,” Tilleard said.
The speed of project delivery is another critical factor. At the Kamoa-Kakula copper complex in the Democratic Republic of Congo, CrossBoundary Energy is developing a 233-megawatt solar and battery project. Tilleard noted that this project progressed from signing to over 80% completion within a single year. In contrast, coal-fired plants can take up to 12 years to complete, and major hydropower projects often require a decade or more. “Investors deploy capital and see assets generating revenue within 18 months,” Tilleard highlighted.
Distributed Systems and Policy Support
Much of the growth in renewable energy is occurring through distributed solar and battery systems installed directly in industrial settings like mines, factories, telecom towers, and even homes. Olamide Niyi-Afuye, CEO of the Africa Minigrid Developers Association (AMDA), pointed to the growing role of solar within mini-grid systems, reflecting a broader strategic shift towards energy infrastructure that can be deployed faster and expanded gradually with flexible financing.
Tilleard also suggested that official statistics might not fully capture the extent of this transition. “Most official statistics still measure the energy transition the old way, by counting megawatts connected to national grids,” he observed, adding, “But solar and batteries don’t need central utilities.” Data from the Africa Solar Industry Association tracked 23.4 gigawatts of operational solar projects by the end of 2025, but Chinese export figures indicate 58.1 gigawatts of solar panels shipped to African countries since 2017, suggesting a potentially much faster adoption rate than officially reported.
Policy changes are further accelerating Africa’s renewable push. Ethiopia, for instance, became the first country to ban imports of internal combustion engine vehicles, stimulating faster adoption of electric vehicles. In South Africa, relaxed limits on private power generation have opened avenues for a surge in industrial renewable energy projects.
Challenges and Financing Solutions
Despite the momentum, significant obstacles persist. Many African utilities face financial difficulties, making lenders wary of long-term power purchase agreements. Financing costs for renewable projects in Africa can be up to three times higher than in advanced economies due to perceived country risk, according to the International Energy Agency.
To bridge this gap, development finance institutions, including the African Development Bank and the International Finance Corporation, are providing crucial support through concessional loans, guarantees, and risk-sharing structures. As Mugwe Manga concluded, “What remains is not a question of technology or cost. It is a question of finance, political will and preparing bankable projects that will drive demand for power on the continent.” The continued expansion of renewable energy in Africa hinges on addressing these financial and governance challenges to unlock the continent’s vast clean energy potential and meet its growing demand for power.
