Renewable energy is overtaking traditional power projects across Africa, industry leaders say

NAIROBI, Kenya (AP) — Africa’s next generation of power projects is increasingly being built around solar and wind power and battery storage, as governments and investors shift away from coal and large hydropower dams in search of cheaper, faster and more reliable electricity.

The shift is visible in a $1.5 billion energy agreement between China and Zambia announced in early May that includes three separate 300-megawatt projects spanning solar, wind and coal-fired power.

While the inclusion of coal underscores the continent’s continuing need for stable baseload electricity, African countries facing rising fuel import bills as a result of the Iran war, unreliable grids and growing industrial demand are increasingly turning to renewable energy projects that can be deployed faster and more cheaply than traditional plants.

Solar and wind power are gaining

Of the 322 energy projects announced across Africa in 2025, 173 were solar projects, 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.

“Africa is not on the periphery of the global energy transition, it is sitting at its center,” said Mugwe Manga, climate finance lead at FSD Kenya. “The continent holds the world’s best renewable resources, and the economics have now decisively turned in favor of clean energy.”

According to Olamide Niyi-Afuye, CEO of the Africa Minigrid Developers Association (AMDA), the continent is undergoing a broader strategic shift in how energy infrastructure is being developed, with an emphasis on systems that can be deployed faster and expanded gradually with flexible financing.

Niyi-Afuye pointed to the growing role of solar within mini-grid systems.

According to the International Renewable Energy Agency, Africa added a record 11.3 gigawatts of renewable energy capacity in 2025, triple the previous year. South Africa, Egypt and Ethiopia accounted for much of the growth.

Lower costs are a major factor

Increasingly affordable technology is helping. Utility-scale solar power costs have dropped by nearly 90% globally since 2010, while onshore wind costs have fallen around 70%, making renewables the cheapest source of new electricity generation in many African markets.

“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,” said Matt Tilleard, CEO of CrossBoundary Energy, which invests in renewable energy in Africa.

Much of the growth is through distributed solar and battery systems installed directly in mines, factories, telecom towers and homes.

“Most official statistics still measure the energy transition the old way, by counting megawatts connected to national grids,” he said. “But solar and batteries don’t need central utilities.”

Data from the Africa Solar Industry Association shows 23.4 gigawatts of operational solar projects had been tracked across Africa by the end of 2025. But Chinese export figures indicate 58.1 gigawatts of solar panels have been shipped to African countries since 2017, suggesting solar adoption may be growing far faster than official figures capture.

Renewables bring faster returns

Investors increasingly favor renewable projects because they can generate returns faster and with less exposure to global fuel price shocks.

“Solar and wind projects are especially attractive at this moment because they combine strong commercial fundamentals with relatively lower investment risk,” Niyi-Afuye said.

At the Kamoa-Kakula copper complex in the Democratic Republic of Congo, CrossBoundary Energy is developing a 233-megawatt solar and battery project to supply one of Africa’s largest copper mines. Tilleard said the project moved from signing to more than 80% completion within a year. Coal-fired plants can take up to 12 years to complete, while major hydropower projects often require a decade or more.

“Investors deploy capital and see assets generating revenue within 18 months,” Tilleard said.

Policy changes help but challenges remain

The continent’s renewable push is also being accelerated by policy changes. Ethiopia was the first country to ban imports of internal combustion engine vehicles, spurring faster adoption of electric vehicles. In South Africa, relaxing limits on private power generation has opened the door to a surge in industrial renewable energy projects.

Still, major obstacles remain. Many African utilities are in financial trouble. So lenders are wary of long-term power purchase agreements. Financing costs for renewable projects in Africa are up to triple those in advanced economies because of perceived country risk, according to the International Energy Agency.

Development finance institutions, including the African Development Bank and the International Finance Corporation, are helping bridge the gap with concessional loans, guarantees and risk-sharing structures.

“What remains is not a question of technology or cost,” Manga said. “It is a question of finance, political will and preparing bankable projects that will drive demand for power on the continent.”

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