Despite attracting just over 2% of global energy investment, Africa looks to alleviate energy poverty through an inward approach and expansion of both conventional and renewable power generation capacity as the path to energy sufficiency, according to Wood Mackenzie’s latest Horizons report.
“Africa is incredibly rich in natural resources; however, it faces severe energy poverty with 600 million people lacking electricity access and four-fifths relying on traditional cooking fuels,” said Mansur Mohammed, Africa Upstream & Carbon Management New Business Development at Wood Mackenzie. “Africa’s minerals power global clean energy transitions while the continent itself remains energy-poor.”
Africa’s total solar and wind capacity is forecast to grow by almost 600% over the next decade, according to the report titled “Asset rich, energy poor. Maximising Africa’s natural resources to transform the continent.” Africa is home to less than 2% of current global solar capacity, and while the pace of solar installations slowed in 2024, overall capacity is expected to increase from 11.4 GW in 2021 to 31 GW by the end of this year.
Africa dominates global production of critical minerals essential for the energy transition. Over two-thirds of global cobalt mine output originates from the continent, alongside approximately 20% of the world’s copper supply. Additionally, Africa produces significant quantities of platinum, manganese, lithium, and rare earth elements, all vital for batteries, renewable energy technologies, and electrification globally.
However, most mineral production is exported to China for processing, resulting in a missed opportunity for domestic value addition and energy development. The scale of investment from risk-tolerant Chinese firms into resource-rich African nations presents an opening for Africa to negotiate deals that could foster investment in local clean energy projects in exchange for access to its mineral wealth.
“On the other hand, Africa faces a massive underutilization of its hydrocarbon wealth—only one-third of discovered oil and gas volumes have been commercialized, which is among the lowest development rates worldwide,” noted Mohammed. “Primary barriers include poor governance, weak regulations, and limited local gas markets. All of these factors contribute to a lack of access to competitive financial resources for local companies.” Wood Mackenzie forecasts that the oil and gas sector in Africa could generate an average of $109 billion annually in government revenues through 2030, a figure that could significantly rise with further resource development.
Despite these obstacles, African oil and gas producers have set ambitious production targets. For instance, Nigeria aims to double its oil production to three million barrels per day and its gas output to 12 billion cubic feet daily by 2030. Angola even exited OPEC in 2023 specifically to facilitate increased liquids production. These initiatives have gained momentum, with regulators introducing fiscal incentives that have attracted nearly $20 billion in project final investment decisions since 2024.
Africa is also a pivotal player in the global liquefied natural gas (LNG) markets, contributing almost 10% of worldwide supply. The continent is a leader in floating LNG technology, managing six out of ten global projects.
Despite this export success, Africa consumes only about 4% of the global gas supply, reflecting the continent’s low per capita consumption—less than one-quarter of the global average. Recognizing the opportunity, African governments are becoming increasingly aware of the need to develop domestic markets alongside export initiatives. Proposals for cross-border pipelines indicate a growing trend of regional cooperation, and gas-to-power transitions present the most economically feasible way to monetize resources.
“By 2050, Africa’s population is projected to grow to 2.5 billion, adding over one billion people to its current numbers. The continent possesses the resources necessary to achieve energy sufficiency. The challenge does not lie in availability but in mobilizing capital, improving governance, and implementing innovative solutions to unlock Africa’s immense energy potential for its populace,” explained Mohammed.
With Africa only accounting for about 3.5% of global emissions, there is a compelling case for the continent to leverage its resources for industrialization, while the rest of the globe accelerates its decarbonization efforts. This balanced approach—maximizing both renewable energy potential and responsible hydrocarbon development—presents the most practical route to ensure energy prosperity for future generations.
