Electricity is becoming increasingly affordable across Africa, thanks to the rapid expansion of renewable energy and falling generation costs.
From solar mini-grids to battery-backed off-grid systems, the continent is witnessing a shift that is not only making energy cleaner, but also more accessible and financially viable for millions.
Across urban and rural regions alike, the economic burden of electricity is beginning to ease. More households are spending less on power than they did a few years ago, a trend experts attribute to the growing adoption of renewable technologies and ongoing innovation in both financing and infrastructure.
“What we’re seeing is the cumulative effect of years of investment in renewables and policy innovation across the world.”
Abraham Masiyiwa, a researcher at the Power Energy Futures Lab
Speaking during a virtual briefing, he explained that Africa is no longer simply importing solutions—it is helping to shape the way affordable electricity is delivered in low-income contexts.
A recent July 2025 report by the International Renewable Energy Agency (IRENA) has highlighted this trend globally, noting that 91% of new renewable energy projects commissioned worldwide are now cheaper than fossil fuel alternatives.
In 2024 alone, solar photovoltaics were found to be 41% more cost-effective than the cheapest fossil fuel options, while onshore wind was 53% cheaper.
This dramatic price advantage is being driven by innovation, scaling, and increasingly efficient supply chains.
In Africa, these trends are delivering tangible results. Utility-scale solar installations have seen their average costs drop by 68% over the past decade from US$3,437 per kilowatt in 2015 to just US$1,093 in 2024.
The cost per kilowatt-hour of solar electricity in Africa has similarly fallen, reaching US$0.074, which now closely mirrors global averages. For many households and businesses, this translates into significantly reduced monthly bills and improved service reliability.
Renewables Stabilize Pricing
Onshore wind energy has also seen gains, with average levelized electricity costs dropping to US$0.051 per kilowatt-hour in 2024—down 34% since 2010.
These price drops are especially impactful in regions that previously depended on costly imported fuels like diesel, which are volatile in price and environmentally harmful.
In countries like Kenya, Egypt, Morocco, and South Africa, large-scale renewables have become the backbone of new power generation. This helps reduce reliance on expensive fuel imports and allows for more stable and predictable electricity pricing.
In Nigeria and elsewhere, rural communities that once relied on kerosene lamps or diesel generators are now switching to solar home systems and mini-grids, often paying a fraction of what they used to.
“These decentralized systems often provide power at a fraction of the previous cost, and with greater reliability.”
Abraham Masiyiwa, a researcher at the Power Energy Futures Lab
In 2024, GOGLA (the Global Off-Grid Lighting Association) reported the sale of 9.3 million solar kits and nearly two million off-grid appliances in Africa, reaching more than 137 million people.
In Nigeria alone, nearly 120 solar mini-grids have been installed recently, serving tens of thousands of households and businesses.
The economic impact of this transition is already evident. Families are saving on energy costs, children have more hours to study, and small enterprises can operate more efficiently and longer into the evening.
Solar irrigation, cold storage, and other productive-use appliances are helping to raise agricultural productivity and reduce post-harvest losses.
Replacing kerosene with solar lighting can cut household lighting bills by over 70%, according to data from the Africa Solar Industry Association (AFSIA), freeing up income for other essentials like school fees or food.
On a macroeconomic scale, IRENA and the African Development Bank estimate that a continent-wide shift to renewables could boost Africa’s GDP by 6.4%.
Financing Challenges Persist
However, financing remains a major hurdle. While equipment prices have fallen sharply, African renewable developers still face some of the world’s highest capital costs, averaging around 12%—three times higher than in Europe.
This means that even as hardware becomes more affordable, tariffs can remain high due to expensive financing.
Masiyiwa emphasized, “Financing, not equipment, is the largest cost component,” pointing to the persistent challenges faced by African energy developers in securing affordable capital.
Policy reform has also played a crucial role. In countries like Rwanda and Ethiopia, streamlined licensing procedures and results-based financing mechanisms have enabled faster, cheaper rollouts of renewable solutions.
These policy innovations are helping make electricity more affordable in both urban and off-grid rural markets.
Yet challenges remain, particularly when it comes to grid integration. Wind and solar projects often face delays due to limited transmission capacity and infrastructure gaps.
In some African countries, the grid is not yet equipped to absorb large amounts of renewable power without significant upgrades.
Battery energy storage systems are increasingly being deployed to address this challenge. Prices for storage have dropped by 93% since 2010, reaching US$192/kWh in 2024, making it feasible to store excess power for nighttime use or backup.
In June 2025, South Africa reached commercial close on the continent’s largest standalone storage project the 153 MW Red Sands BESS. The facility will store solar energy and ease grid congestion in the Northern Cape, a region with high renewable penetration.
Despite the progress, Masiyiwa warned that without targeted subsidies or concessional finance, the poorest communities may still be left behind.
“The energy transition must be inclusive.
“Without financial support, millions risk missing out on the benefits of cheaper, cleaner electricity.”
Abraham Masiyiwa, a researcher at the Power Energy Futures Lab
Still, the broader outlook is positive. With costs continuing to fall and innovation accelerating, Africa is poised to leapfrog traditional energy systems and lead in the global shift toward clean, affordable electricity.
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