Gulf Nations Emerge as Key Investors in Africa’s Energy Transition, CATF Report Finds

Countries in the Middle East, particularly the United Arab Emirates and Saudi Arabia, are becoming increasingly influential in shaping Africa’s clean energy and industrial future, according to a new report by the Clean Air Task Force (CATF).

The report, The Role of Middle East Leadership in Clean Energy Infrastructure Funding, highlights how growing Gulf investments in energy and enabling infrastructure could help bridge Africa’s power deficits, stimulate economic development and support global climate objectives—provided funding models prioritise long-term, system-wide impact.

$175 Billion in Announced Commitments

Since 2010, UAE and Saudi governmental and semi-governmental entities have announced more than $175 billion in clean energy investments and commitments across Africa, with the majority pledged after 2022.

Unlike traditional sovereign lending, much of this capital has been structured as direct project investment, reducing debt burdens while enabling large-scale infrastructure deployment.

The UAE has expanded its footprint through entities such as Masdar and the Abu Dhabi Fund for Development, investing in solar, wind, geothermal and green hydrogen projects across North, East and Southern Africa.

Similarly, Saudi Arabia—through ACWA Power and the Saudi Fund for Development—has expanded large-scale renewable and hydrogen investments in countries including Egypt, South Africa and Morocco.

Addressing Energy Access and Infrastructure Gaps

Despite Africa’s vast renewable potential, more than 600 million people on the continent still lack reliable electricity. The report notes that Africa receives only 2% of global clean energy investment, while the continent requires an estimated $133 billion annually by 2030 to meet its development and climate targets.

CATF estimates that the average cost of capital for African energy projects stands at 15.6%—more than three times higher than in Western Europe and the United States—underscoring the need for patient and risk-tolerant capital.

The report identifies key investment priorities, including transmission and grid infrastructure, clean firm power such as geothermal and nuclear energy, system-level projects linking energy supply to industrial demand, and climate-smart initiatives such as methane abatement and critical minerals development.

Risks of Uneven Investment Patterns

However, the report cautions that current Gulf investment flows remain concentrated in a limited number of relatively well-capitalised African economies, potentially replicating longstanding inequities in development finance.

CATF authors argue that Gulf countries have an opportunity to differentiate themselves by expanding support to underserved nations, investing in enabling infrastructure, fostering workforce development and aligning projects with national development priorities.

With traditional development finance from the United States, Europe and China becoming increasingly constrained, the report concludes that Gulf investors are uniquely positioned to help close Africa’s growing clean energy financing gap and accelerate a durable and inclusive energy transition.