Nearly 600 million people in sub‑Saharan Africa — roughly two in every five on the continent — still lack access to electricity. Progress has slowed and is not keeping pace with population growth. Financing is a key bottleneck: in 2023, less than USD 2.5 billion was committed to new electricity access connections in the region. Around half of that finance is for grid‑expansion, with decentralised solutions (mini‑grids, solar home systems) growing but still under‑funded.
To achieve universal access by 2035, the IEA estimates that Africa needs about USD 15 billion per year (≈ USD 150 billion cumulatively) in investment.
The breakdown suggests roughly USD 7 billion for grids, USD 5 billion for mini‑grids, and USD 3 billion for stand‑alone systems annually.
Key challenges include:
Heavy reliance on public (often concessional) funding, while private finance remains low and unevenly distributed.
High cost of capital, broad rural‑urban and country disparities (finance flows are concentrated in a few countries and in urban areas)
Affordability issues for consumers in low‑income areas, informal settlements, conflict‑affected zones and island states; special approaches are needed to reach the hardest‑to‑serve populations.
The report, Financing Electricity Access in Africa, highlights that while finance is essential, its design matters: concessional funds should be used strategically (e.g., in areas private capital will not go), new business models and innovative financing are needed for decentralized systems, and improvements in regulation, subsidies, demand stimulation and enabling environments will be key to making electricity access commercially viable and equitable.
Read more here.
