Absa’s Izaak Coetzee urges policy reform, infrastructure upgrades and finance to drive Africa’s energy transition.
Africa remains one of the least electrified regions in the world, despite possessing abundant renewable energy resources
In a recent commentary, Izaak Coetzee, head of strategic insights & analytics at Absa Group, highlighted the continent’s untapped energy potential and the urgent need for policy reform, infrastructure development and innovative financing to close the energy gap.
From a satellite view, Earth’s glowing urban centres reveal widespread access to electricity. However, Africa appears largely dark — a visual reminder that over half a billion people across the continent still live without power. Coetzee describes this as both a “human development crisis and a missed economic opportunity.”
Africa is rich in renewable resources, with the potential to generate 1.5 million terawatt hours (TWh) annually from solar power alone. Wind energy could contribute another 980,000 TWh, alongside 350 GW in hydropower and 15 GW in geothermal capacity. Yet, despite holding 60% of the world’s best solar resources, Africa accounts for just 1% of installed solar generation. Studies show that renewables could meet up to 80% of the continent’s energy needs by 2040, but the challenge lies in converting this potential into viable, scalable systems.
“Africa is not only key to its own energy transformation, it is central to the global clean energy transition,” Coetzee stated.
He pointed out that over US$20bn in annual investment is needed to meet Africa’s energy and climate targets by 2030. However, only 2% of global clean energy investment currently flows into the region. To change this, Africa must adopt transparent, investor-friendly regulatory frameworks that provide predictability and legal protections.
With South Africa poised to assume the G20 Presidency, Coetzee sees a unique opportunity to reposition Africa as a leader in renewable energy. He believes regional collaboration, smart policies and good governance are essential to unlocking the continent’s clean energy future.
Coetzee also emphasised the importance of first fixing the continent’s outdated energy infrastructure. Average grid losses are around 15%, and weak interconnectivity means even the best renewable projects fail to serve remote or rural communities.
He noted, “Without reliable transmission and distribution networks, capacity growth is meaningless.”
Africa’s regional power pools, such as the Southern, Eastern, Central and West African Power Pools, hold promise for building integrated electricity systems. However, Coetzee argued that investment must first target key infrastructure projects to modernise the grid and connect energy-rich areas with high-demand regions.
On financing, Coetzee called for innovative solutions tailored to Africa’s unique challenges. “To create a truly investable environment, African energy markets need more than ambition,” he said. “They require deep structuring expertise and innovative finance solutions.”
Absa has been at the forefront of sustainable financing, facilitating over R49.2 billion in green investments in 2024 alone. The bank played a major role in South Africa’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) and supported Tanzania’s first municipal green bond through the Tanga UWASA initiative, which provided clean water access to over 6,000 households.
“These projects illustrate the power of partnership, technical depth and local insight to turn Africa’s potential into progress,” Coetzee remarked.
With Africa expected to account for more than 25% of the global population within the next 25 years, the urgency to electrify its future is more pressing than ever. As Coetzee concluded, “The tools exist. The capital exists. The renewable resources are abundant. What remains is the political will, policy coherence and financial innovation to translate ambition into action.”
