More than half of March funding went to SA

From the newsletter

South Africa accounted for more than half of the renewables funding in March, according to the Continent Rising funding database. There were 30 funding deals across 17 African countries, totalling $8.7 billion. Nigeria led with seven deals but came second in total funding. Since the start of 2025, over $22 billion has been pumped into the sector.

• Loans dominated, accounting for 88% of total investments. Additionally, there was a commitment of $500 million in green bonds from Zambia's Copperbelt Energy to develop solar and transmission lines. 

• Governments were also involved, with countries such as Ghana allocating $77 million for the energy sector and Nigeria approximately $2.1 million for rural electrification programmes.

More details

• Approximately $5.8 billion was allocated to building and upgrading energy infrastructure. This area is expected to require significant investment in the future as renewable power generation continues to grow. South Africa, the largest recipient of funding with $5 billion, will use part of this to address its energy infrastructure needs. The country currently lacks sufficient transmission line capacity to distribute power in regions such as the Northern Cape, Western Cape, and Eastern Cape provinces.

• Solar technology received the second-highest amount at $1.8 billion. Nigeria accounted for $750 million of this, channelled through the World Bank to finance solar projects. This funding will be managed through the Distributed Access through Renewable Energy Scale-up (DARES) Project, which aims to connect 17.5 million people via off-grid solar solutions. There are also plans to establish a solar panel manufacturing plant with a capacity of 1,200 MW.

• Although the renewables sector is mature, there were some venture capital and seed round funding deals totalling $1.3 million. Grants worth $122 million were also awarded. These went to Congo, Eswatini, and Eritrea, with 67% of these grants allocated to Mauritania to support its first battery energy storage systems and its hydrogen sector.

• Copperbelt Energy of Zambia has committed to investing $500 million in green bonds in the energy sector by 2026. This funding method is relatively new in Africa, with only a few countries having utilised it, including Tanzania, Rwanda, Gabon, Seychelles, Nigeria, South Africa, Morocco, Mozambique, Namibia, Mauritius, and Zambia. The corporate sector in this area is mainly dominated by banks, primarily from South Africa. Energy companies come last in utilising this funding method.

Our take

• There is increased optimism for renewable energy funding in 2025. Twelve countries have updated their energy policies to make them more attractive and to allow private sector investment in areas such as transmission, which was previously reserved for the government. This should create more opportunities and attract greater investment.

• South Africa, which continues to experience load shedding, is expected to continue drawing investment from commercial and industrial energy consumers as well as independent power producers. The country also plans to launch bids for its first independent power transmission line investment in November, likely maintaining its lead in renewable energy investment in 2025.

• African governments still account for a relatively small proportion of funding for the energy sector, despite the fact that over 70% of African power utilities are state-owned. This needs to change to improve the performance of the energy sector.