Africa Ramps Up Renewable Power Expansion Despite Securing Just 2% of Global Energy Investment, Finds Wood Mackenzie Report

Africa is charting a new path toward energy sufficiency, even as it attracts just over 2% of global energy investment, according to Wood Mackenzie’s latest Horizons report. The continent is focusing on reducing energy poverty through inward-looking policies and an expansion of both conventional and renewable power generation.

Wood Mackenzie’s Mansur Mohammed, Africa Upstream & Carbon Management New Business Development, highlighted the paradox shaping Africa’s energy landscape. He noted that despite its vast natural resource wealth, the continent continues to struggle with widespread energy poverty, with 600 million people lacking access to electricity and four-fifths of the population relying on traditional cooking fuels. He added that while Africa’s minerals play a crucial role in global clean energy transitions, the continent itself remains energy-poor.

Africa’s renewable energy prospects are expected to accelerate significantly. According to the report “Asset rich, energy poor: Maximising Africa’s natural resources to transform the continent,” the continent’s solar and wind capacity is forecast to grow by nearly 600% over the next decade. Despite a slowdown in solar installations in 2024, overall solar capacity is projected to increase from 11.4 GW in 2021 to 31 GW by the end of 2025. Africa currently holds less than 2% of global solar capacity.

In addition to renewable potential, Africa commands a dominant position in the global supply of critical minerals essential for clean energy technologies. The continent produces more than two-thirds of global cobalt output and around 20% of the world’s copper, along with significant quantities of platinum, manganese, lithium, and rare earth elements. However, most of these minerals are exported to China for processing, limiting opportunities for domestic value addition. Wood Mackenzie suggests that Africa could leverage its mineral resources to negotiate clean energy investments from China in exchange for continued access to these critical materials.

The report also points to the underdevelopment of Africa’s hydrocarbon resources. Only one-third of discovered oil and gas volumes have been commercialized, making it one of the lowest development rates globally. Mohammed attributes this to challenges such as poor governance, weak regulations, and limited local gas markets, which restrict access to competitive financing for local companies. Despite this, Africa’s oil and gas sector is expected to generate an average of US$109 billion in annual government revenues through 2030, with the potential for higher returns if more resources are brought into production.

Several African nations are pursuing ambitious production targets. Nigeria aims to double oil output to 3 million barrels per day and increase gas production to 12 billion cubic feet per day by 2030. Angola, which exited OPEC in 2023, is working to expand liquids production to boost output. Regulatory reforms and fiscal incentives in both countries are driving renewed investment interest, attracting nearly US$20 billion in project final investment decisions since 2024.