Africa has a unique opportunity due to its rich endowment of natural resources and critical minerals that are essential for the world's energy transition: the continent is home to 60% of the world’s best solar potential, 50% of the world’s wind power capacity, 71.4% of the world’s cobalt, 76% of the world’s platinum and 58% of the world’s manganese.

Yet, the continent currently attracts only 3% of global energy investment and 2% of global green energy investments.

According to the IEA Sustainable Africa Scenario (SAS), transitioning to a clean energy sector implies almost doubling of total capital over 2026‐2030 with investment needs projected to average about USD 200-billion annually.

Most of the financing available for power sector projects today is in hard currency which makes the financing unsustainable in the long-term because of the currency mismatch occasioned by the volatility of local currencies against international hard currencies. Although currency hedging and other options exist, they can be expensive and are lacking for many developing country currencies, particularly at the long tenors, low cost and large scale required to support the needed clean energy investments.

Report by the African Development Bank