The Power Sector in Africa

30 May 2024

Power Sector in Africa: An Enormous $1.3 Trillion Opportunity with Nearly 700 Projects

 

The power sector in Africa needs enormous investments to supply the continent’s rapidly growing population and economy. Additionally, Africa’s rich endowment with renewable energy sources such as solar, wind, and hydropower places it in a prime position to export energy in the form of hydrogen to global markets.

So what is the continent doing to supply these enormous demands? It is implementing almost 700 large power investment projects, worth around $1.3 trillion.

Current Investments in the Power Sector in Africa

These ongoing and upcoming energy projects include power generation plants, storage facilities, and transmission projects across the continent. Renewable energies play a huge role in these efforts. Of about 550 active power generation projects, more than 480 are in renewable energy such as solar, hydropower, wind, hydrogen, biomass, and geothermal. Coal, gas, and nuclear power projects account for the remaining 72 plants.

Breakdown of Power Generation Projects

More than 200 large, ongoing, and upcoming solar power projects represent the largest share of renewable energy projects in Africa. Hydropower comes in second with about 100 projects. A series of recently announced hydrogen projects, many of which are located in Mauritania, account for many of the highest-value energy projects. Especially South Africa, as well as countries such as Egypt, Ghana, and Morocco, among others are developing large wind parks. In East Africa, almost 30 large geothermal power projects are currently underway.

Key Financiers

Due to its economic and environmental importance, the power sector in Africa is heavily supported by strong global financiers such as the African Development Bank, the World Bank Group/International Finance Corporation, the European Union, KfW Development Bank and the Export-Import Bank of China.

Country-Specific Highlights

South Africa overall accounts for the largest number of energy projects on the continent, with 105 projects currently being planned or under construction. Kenya is second with 47 projects, followed by Egypt with 37 projects. Notably, Mauritania has announced a series of enormous hydrogen projects over recent months.

Future Growth and Opportunities

Spending on these projects is set to rapidly expand over the upcoming years, from an estimated $35 billion in 2024 to close to $60 billion in 2027 – not considering new projects that will be announced until then. For global suppliers of related products and services, the African power sector represents a massive opportunity.

Explore More about the Power Sector in Africa and beyond

If you would like to explore more about projects in your region, market or area of interest, sign-up for ABiQ’s Free Trial or contact us at info@abiq.io. To read more blogposts about ABIQ’s key sectors, explore our articles about infrastructure, building construction, extractive industries, and water.

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