Investors from Gulf countries are expected to continue funding renewable energy projects in Africa despite disruptions linked to the Iran war, analysts say, citing strong long-term economic and strategic incentives.
Wealth funds and state-backed companies from oil-rich Gulf nations are increasingly investing in Africa’s clean energy sector, attracted by rising electricity demand, rapid urbanization, and the continent’s expanding role in global supply chains for critical minerals and manufacturing.
A report by the Clean Air Task Force found that more than $101.9 billion had been invested in Africa’s renewable energy sector by Gulf countries by the end of 2024. The funding has largely come from the United Arab Emirates, Saudi Arabia, Qatar, Kuwait, and Bahrain.
Most of the investments have been concentrated in North Africa, Southern Africa, and parts of East Africa, while West Africa has attracted comparatively lower levels of funding.
“Africa remains one of the few regions where demand growth is unequivocal,” said Matthew Tilleard, chief executive of CrossBoundary Energy, a Nairobi-based renewable energy developer. He said short-term geopolitical disruptions could delay some deals but were unlikely to derail long-term infrastructure investments.
Africa faces one of the world’s largest electricity deficits, with around 600 million people still lacking access to power. Governments across the continent have increasingly turned to private investors to finance solar, wind, and hybrid power projects to expand electricity generation without placing excessive strain on public budgets.
Analysts say this energy gap presents opportunities for Gulf investors seeking to diversify beyond oil and gas.
“Gulf investments in Africa tend to be driven by pragmatic national interests and strategic returns,” said Louw Nelson, a political analyst at Oxford Economics. He noted that many projects already underway are long-term developments that have taken years to plan.
Overseas renewable investments also form part of broader economic diversification strategies across Gulf states as they prepare for a gradual global transition away from fossil fuels.
Energy analyst Joel Okanda said disruptions to oil and gas shipping caused by the conflict with Iran may strengthen the case for renewable investments by highlighting vulnerabilities in traditional energy supply routes.
Africa’s energy sector is also closely linked to global demand for critical minerals such as cobalt and gold, which are used in batteries and high-tech manufacturing.
Renewable power projects supporting mining and industrial operations could provide Gulf investors with strategic access to these supply chains, analysts say.
However, challenges remain. Currency volatility, regulatory uncertainty, and limited transmission infrastructure — particularly in West Africa — continue to influence where investments are directed.
“Generating power is only one part of the equation,” Okanda said. “Transmission systems and functioning electricity markets are also essential to ensure electricity can be sold and paid for.”
