How legislation can help boost renewable energy investments in Africa

Africa has a crucial role in the global energy transition, which places a responsibility on African countries to deploy the instrumentality of the law to drive investments in the renewable energy industry. For example, to boost renewable energy investments in Rwanda, the government issued the Rwanda Energy Feed in Tariff regulations in 2012 to create an enabling environment for renewable electricity power generation and an increase in renewable energy investments. That decision, alongside other innovative steps, has helped increase electricity access in Rwanda from 6% in 2009 to 75% in 2024. Its Ruzizi III hydro project has added 145MW to the country’s total electricity generation, which now stands at 332.6 MW.

Rwanda was able to accelerate renewable energy investments because there were effective laws in place to support energy generation. Other African governments will need to review their laws to create an enabling environment for investments in the renewable energy sector. Global and regional laws that support climate change adaptation efforts will be critical to Africa’s role in the energy transition.

African countries are making efforts to invest in renewable energy to develop their economies and achieve net zero in relation to the United Nations Framework Convention on Climate Change (UNFCCC) and the Paris Agreement. Notably, Mauritania in Northwest Africa, is executing a green hydrogen project that is expected to generate $34 billion in investment, which would significantly improve the nation’s economy.

However, more can be done to accelerate renewable energy investments, as most African countries are yet to adopt the UNFCCC and ancillary legal frameworks. Once domesticated, these global legal treaties will become internally binding on countries.

The African Free Trade Continental Agreement (AfCFTA) is another key legal framework for Africa’s energy transition, which over 48 countries have ratified. Accra, in Ghana, hosted the AfCFTA Guided Trade Initiative (GTI), which involved 12 African countries serving as pilots for the trade policy environment. Once the agreement becomes operational across more than 50 state parties, it will catalyze the free flow of investments in renewable energy in Africa.

Additionally, the Convention of the African Energy Commission seeks to promote cooperation within the African Union (AU) to develop the continent’s energy capabilities. But financial cooperation between AU member states should include more private-sector engagement. For example, a few weeks ago, Coscharis Technologies Limited (a subsidiary of the Coscharis Group) recently finalized plans to execute a $4 billion renewable energy project to revolutionize Nigeria’s power sector. This is the largest green energy project in West Africa, which will harness solar energy to reduce the country’s dependence on fossil fuels. This kind of investment in Africa highlights what’s possible when the private sector is encouraged and their role is seen as critical.

Ultimately, efficient laws must be the pedestal upon which other renewable energy reforms and solutions can thrive. This means that African governments must utilize efficient laws in conjunction with policies, national institutions, stakeholders and security agencies to ensure an increase in renewable energy investments to solve the climate crisis.