Africa’s energy transition must move beyond ambitious targets and focus on delivering bankable power projects that expand access, strengthen energy security and support economic growth, according to Standard Bank Corporate and Investment Banking.
Rentia van Tonder, Head of Power and Renewables at Standard Bank Corporate and Investment Banking, said Africa’s energy transition must be practical, flexible and commercially viable, with investment directed towards renewable generation, transmission infrastructure, energy storage and grid optimisation.
In her article titled “Powering Africa’s Just Energy Transition: From Ambition to Bankable Delivery,” van Tonder noted that the continent’s traditional approach to developing power projects is evolving as countries seek faster and more sustainable solutions to address energy shortages.
“For many years, the formula for developing and financing power projects in Africa has been much the same,” she said, highlighting a model built around utility procurement, private sector project development, long-term power purchase agreements and sovereign risk support.
While the structure supported several successful projects, the growing demands of Africa’s energy transition require more flexible approaches that can attract capital while addressing reliability, affordability and sustainability challenges.
Africa’s Electricity Access Gap Drives Need for Faster Energy Transition
The urgency of Africa’s energy transition is underscored by persistent electricity access challenges across the continent. According to the 2025 edition of Tracking SDG7, 565 million people in Sub-Saharan Africa lacked access to electricity in 2023, representing 85 percent of the global electricity access deficit. Van Tonder said Africa’s economic development depends on reliable, affordable and sustainable energy, making power and renewable energy central pillars of industrialisation and economic transformation.
“Renewable energy, supported by flexible supply solutions, grid optimisation, storage and enabling policy supporting implementation, is increasingly the most credible route to closing the energy gap while building a more resilient and competitive economy,” she said.
The continent’s energy transition, she added, must balance emissions reduction goals with the need to expand electricity access and support economic growth.
Solar, Wind and Battery Storage Transform Africa’s Power Sector
Rapid technological improvements in renewable energy are changing the economics of electricity generation across Africa, particularly through the expansion of solar, wind and battery storage solutions. Van Tonder highlighted hybrid renewable energy projects that combine generation capacity with storage as a critical component of Africa’s future energy systems. These projects help address the intermittent nature of renewable energy by improving reliability and enabling electricity supply when demand is highest.
South Africa’s Kenhardt projects developed by Scatec were cited as an example of how renewable energy can transition from intermittent generation to more reliable dispatchable power. The projects combine 540MW of solar photovoltaic capacity with 1GWh of battery energy storage, demonstrating the potential of integrated renewable energy solutions at scale.
Grid Expansion and Storage Key to Reliable Renewable Power
While renewable generation capacity continues to expand, van Tonder stressed that Africa’s energy transition will depend heavily on strengthening electricity grids and transmission networks. She noted that increasing renewable energy penetration requires significant investment in grid infrastructure, storage capacity and digital technologies to maintain reliable electricity supply.
“Generation alone is not enough,” she said, adding that transmission networks and system flexibility will determine whether Africa can successfully scale renewable energy.
Investment in grid infrastructure remains a major requirement as countries integrate more variable renewable energy sources into national power systems.
Policy Reforms Creating More Investable Energy Markets
Improved regulation and market reforms are helping create conditions for greater private sector participation in Africa’s power sector. Van Tonder pointed to South Africa as one of the continent’s leading examples of how policy changes can unlock new investment opportunities.
The implementation of open access power markets through wheeling arrangements, electricity trading and increased private generation is broadening opportunities for investors and energy users. She said clear regulations, consistent implementation and stronger market structures are essential for attracting capital into the energy sector. “When regulation is coherent and implementation is consistent, capital follows,” van Tonder said.
Innovative Financing Needed to Scale Africa’s Energy Projects
Financing remains one of the biggest factors determining whether Africa can move from energy transition ambitions to actual project delivery. Van Tonder said the continent requires innovative financing models and capital structures designed around local market conditions, risk allocation and long-term commercial viability. Investment will be needed across the entire power value chain, including generation, transmission, storage and distribution infrastructure.
At Standard Bank Corporate and Investment Banking, she said the institution is focused on supporting structured financing solutions, mobilising private capital and connecting stakeholders to develop commercially viable energy projects. The bank views its role as supporting the development of projects that can attract investment while addressing Africa’s energy challenges.
Africa Needs Practical Energy Transition Pathways
Van Tonder said Africa’s energy transition will not follow a single model, given differences in energy resources, economic conditions and market structures across countries. Instead, she argued that the continent needs practical pathways that increase electricity access, support industrial development and mobilise investment at scale. Ahead of the Africa Energy Forum in Cape Town, she said the focus should shift from policy commitments to project execution.
The next phase of Africa’s energy development will depend on converting renewable energy ambitions into operational projects that deliver affordable and reliable electricity. Standard Bank remains committed to financing power-related opportunities across African markets and supporting the continent’s transition towards a more secure, sustainable and competitive energy future.
Jefferson Wachira is a writer at Africa Digest News, specializing in banking and finance trends, and their impact on African economies.