The Hub is proud to work with 28 fellows across academic, consulting, government, and development sectors with deep expertise in energy tech, utilities, energy finance, development finance, and more.

Working with fellows is the sweet in the Hub sauce. Our fellows help us take a step back and think deeply about how electricity can lift people out of poverty and turn the frontiers of research and evidence into digestible insights and actionable to-do lists for policymakers and donors. Best of all, our fellows expand our global energy-for-growth family. The work we do at the Hub is bigger than any team can take on alone, and we’re grateful to partner with them.

Read on for the latest insights from some of our top researchers.

Four Ways African Countries Can Secure Better Outcomes from Chinese-Supported Power Projects

By: Naa Adjekai Adjei, Senior Associate, Sustainable Energy for All
May 18, 2026

The literature on African energy project finance centers largely on Western-supported investments. This creates a blind spot for decision makers in sub-Saharan Africa, where China funds or builds approximately 20% of power plants. Unlike other international partners, China typically delivers power projects as integrated packages, with financing tied to state-backed engineering, procurement, and construction contractors. Some host countries, underprepared for this model, face delays, cost overruns, and lower-quality outcomes.

Naa Adjekai Adjei pinpoints the faultlines, shows how Ghana navigated them through cost benchmarking, competitive procurement, stronger finance negotiation, and project oversight expertise to achieve better results.

Read the full memo.
Read more of Naa’s other writing on this issue.

Pricing Electricity Right in Emerging Economies: Balancing Affordability and Utility Solvency

By: Ama Baafra Abeberese, Associate Professor, Wellesley College
May 5, 2026

Achieving universal access to affordable electricity can conflict with ensuring the financial solvency of utilities. In the same countries where over 600 million people are without connection to electricity, fewer than 40% of utilities are able to recover their costs, which in turn affects the ability to deliver service to those who need it. Is there an electricity tariff structure that can simultaneously achieve both objectives?

Ama Baafra Abeberese weighs the pros and cons of research on three common tariff approaches and recommends increasing block tariffs as the best positioned to balance these competing objectives in developing markets.

Read the full memo.
Read more of Ama’s brilliant takes here.

To ‘Empower’ Women, Prioritize Energy for Public Services — Not Individuals’ Economic Productivity

By: Habiba Ahut Daggash, Senior Associate, RMI
February 10, 2026

Many funders now measure the success of their electrification or productive use programs not just by megawatts deployed, but also by the number of women who receive appliances, jobs, skills, or lead enterprises. While well-intentioned, these targets can be counterproductive when they overlook local norms, community power dynamics, or the structural barriers rural women face — particularly around domestic work, land ownership, and autonomy.

Habiba Ahut Daggash writes that for energy interventions to truly empower, donors and policymakers must prioritize expanding and improving public services that reduce the domestic work that consumes women’s time and limits their choices.

Read the full memo.
To dig into more of Habiba’s takes, go here.

Dispelling Overblown Security Risks of Nuclear Exports

By: Jessica Lovering, Postdoctoral Researcher, Uppsala University, and Hamna Tariq, Research Associate, Energy for Growth Hub
January 26, 2026

As the United States, China, and Russia race to build and export next-generation nuclear reactors, critics warn of increasing risk of weapons proliferation or deadly radiological release from potential terrorist capture in emerging economies.

Our fellow Jessica Lovering and our staff research associate Hamna Tariq took this one on directly. And here’s the TLDR: Though valid, these concerns are overstated. The institutions and technologies that govern nuclear power make weaponization extremely difficult.

Read the full memo.
Learn more about Jessica here.

Written by Meron Tesfaye and Jillian Mock.

One of its core features is a concept called ‘Energy Security Pacts,’ based on an idea first proposed by the Hub. It would enable the United States to co-invest with key allies in strategic energy projects that improve energy security, reliability, and cost. More reliable power is necessary to expand industries that also benefit the United States, including mining and minerals processing.

Next, the full House of Representatives will consider the bill.

In the Senate, Chris Coons (D-DE) and Pete Ricketts (R-NE) introduced a bill with a similar provision in April. That bill, known as the Energy Security Pacts Act, will go next to the Senate Foreign Relations Committee.

So, what exactly are Energy Security Pacts? How could they work in different partner countries? We’ve rounded up insights from our team on how this policy tool would work and what it could look like in three different countries: Honduras, Zambia, and the Philippines.

What is an Energy Security Pact?

The Big Picture

Energy Security Pacts are bilateral investment packages by the US government, alongside private partners, in the energy system of a strategic priority country. They’re a streamlined way to advance partner country and US interests through global energy investments.

These pacts would also boost US interagency coordination around these investment projects; lack of coordination currently prevents US investments from reaching their full potential.

These Pacts would follow a five-step process:

1. Choose a strategically important partner country with energy security needs that impact areas of US interest, willingness to advance key reforms, and resources to invest alongside the US.

2. Conduct a joint US-Partner Country analysis on the primary constraints to energy security, drawing on MCC’s constraints-to-growth analysis.

3. Negotiate and agree to an Energy Security Pact of joint investments in key energy security solutions supported by tools and resources from agencies like the State Department, Millennium Challenge Corporation, US International Development Finance Corporation, and the Department of Energy.

4. Implement investments by relevant US agencies, overseen by the State Department and agency political leadership.

5. Report results to the White House and Congress.

Go Deeper:

• This report (8 page version for the motivated, 1 page version for the time-pressed) by Katie Auth, Casey Dunning Davis, and Todd Moss provides a comprehensive overview.

• Casey wrote about why interagency coordination matters and the Energy Security Pacts Act in the Senate.

• And Katie wrote about the DOMINANCE Act in her Substack, Aid Interrupted.

Three Examples: Honduras, Zambia, and the Philippines

To play out what these ESPs could look like in practice, we chose three countries dealing with different energy challenges. We break down why the US and each country would benefit from a partnership, and detail what role each US government agency would play in bringing the ESP to life.

Honduras

The United States seeks to develop Central American energy markets that can support industrial development, near-shore manufacturing, and expand trade ties with the US.

With the second-highest unemployment rate in Central America, 60% of its population living below the poverty line, and one of the Western Hemisphere’s lowest industrial electricity access rankings, Honduras needs reliable and affordable electricity to boost domestic economic growth.

An Energy Security Pact would help the US meet its strategic objectives in the region while delivering affordable and reliable electricity to Honduras.

Read more about how an Energy Security Pact would work in Honduras.

Zambia

The US wants to help countries scale up production of key minerals, and diversify the processing of those materials outside China.

Zambia, Africa’s second-largest copper producer, depends on continuous, affordable power to run mines, smelters, and processing facilities. But in recent years, chronic power shortages have been an ongoing problem.

A Zambia Energy Security Pact would coordinate key US agencies to:

1. Diversify power generation and fortify the grid against drought;

2. Secure reliable electricity for copper mining and processing;

3. Create a more bankable, investment-ready power market that attracts private capital.

Read more about how an Energy Security Pact would work in Zambia.

The Philippines

Across Southeast Asia, the US wants to help allies strengthen their economic competitiveness and reduce reliance on China.

In the Philippines, energy vulnerabilities threaten the country’s security and economy. An aging and fragmented electricity grid, partially controlled by China’s State Grid Corporation, discourages private investment and creates operational and security risks. The Philippines also imports over half its energy supply, exposing it to price shocks and disruptions. And high electricity prices constrain key industries that could help secure mineral supply chains.

A Philippines Energy Security Pact would secure the Philippines’ energy system through coordinated investments that expand US export opportunities, increase grid resilience, and strengthen market governance. The Pact would also limit Chinese leverage.

Read more about how an Energy Security Pact would work in the Philippines.

I can’t blame these politicians. Energy generation almost always dominates energy conversations, while energy demand is often an afterthought, misunderstood, or stuck between hype from the tech-optimists or fear from conservation-minded advocates. At one extreme, people assume rising demand will trigger all kinds of negative economic and environmental impacts. At the other, people — especially in many emerging economies where demand is a major gap — view new sources of demand as a potential lifeline. In Ethiopia, for example, the government hopes demand from data centers will bridge utility finances and FX shortage.

But neither of these outcomes is inevitable. Demand itself does not determine whether power becomes more affordable or reliable. Policy does. In order for demand center projects — including data centers — to benefit everyone, policy must support adequate energy infrastructure, plan for demand, enforce transparency around energy dealmaking, and address core public economic and social concerns.

When policy fails, demand centers can raise power prices and lower quality.

With the right policy support, demand centers (whether on- or off-grid) can provide tremendous value: They can anchor new energy projects; strengthen utility revenue; support infrastructure expansions, upgrades, and services; reduce technology and financing risks; and ultimately help lower overall power costs. But in poor public policy contexts, demand centers fail to live up to this promise. In practice, policy failures around demand centers tend to fall into four categories:

1. Demand increases without sufficient energy infrastructure to support it. When demand grows without corresponding investments in supply, grid, or service improvements, it begins to compete with existing uses of power, raising electricity prices or reducing quality of service for existing customers. In 2024, demand from bitcoin mining resulted in widespread outages in Iran. Most US states are underprepared for demand surges, a gap that will likely show up in price increases or quality of service declines.

2. Poor demand planning leaves power projects exposed to low-value users. When power projects are built without planning the right mix of customers, utilities end up selling to quick-to-deploy and quick-to-pay users, without considering long-term economic value. Until recently, for example, data centers for bitcoin mining in Ethiopia paid just ~3 cents/kWh for power from the newly commissioned Grand Ethiopian Renaissance Dam plant — paying half the actual cost of power supply and shielded from tariff increases for other users. Without demand planning, utilities with excess capacity face similar financial loss.

3. Politicians, with little transparency and expert input, shape demand deals poorly. In Kenya, the government just cancelled a celebrated data center deal with Microsoft due to lack of adequate supply. When politicians, without energy expert guidance, strike deals and often do so behind closed doors, operators and implementers are left managing the consequences. Failing to launch is just one example, and not the worst one, to be honest. In other instances, non-transparent and politically driven demand deals have also resulted in unsustainable debt, inflexible loads that strain the grid, higher prices, and declining power quality over time.

4. Advocates propel demand centers without addressing core public economic or social concerns. Although rising energy prices have been the focus of backlash in the United States, data centers are also being banned in states where electricity prices have not yet increased. This is because the core public concern around AI-driven job loss remains unaddressed. Similarly, Angolans protested a major hydrogen export project in 2022 because they saw little connection between export and improving local electricity access. When policymakers fail to address core economic and social concerns, public backlash grows and raises energy development risks and costs, harming both current and future consumers.

Good policy determines whether demand centers help or hurt the public.

In both mature and emerging markets, affordable, reliable power depends as much on demand and policy design as it does on generation. When utilities and decision makers fail to plan for demand — how to supply it, which types to prioritize, the feasible terms under which it operates, and the broader public interest context — demand centers can end up raising electricity costs and weakening service quality. Politicians then rush in with short-term fixes instead of deep policy reforms that strategically make use of demand centers. This pattern matters even more in emerging economies, where decisions about which demand centers to attract and under what conditions can determine the long-term financial health of both the power sector and wider economy.

Written by Meron Tesfaye, originally published on May 28, 2026 on The Energy for Growth website.

Here are five killer infographics we find ourselves coming back to repeatedly. They demonstrate the relationship between energy and economic development, how African countries can actually benefit from the current rush for their critical minerals, how green grids are really hydro, and how the US government is making life painful for nuclear tech firms.

The Fridge

The Hub literally started with an infographic. That’s how much we love them!

When Todd Moss bought a new refrigerator in 2013, he noticed his typical single-family American fridge would use more electricity than most people living in Africa use in a whole year. He created a simple graphic that went viral because of how starkly it illustrated global energy poverty.

Learn about The Fridge’s impact.

The Empty Quadrant

This analysis underpins everything we do at the Hub. There are no high-income countries without high energy consumption, period. The trend holds across all regions and all years. The bottom line: economic growth depends on having enough reliable, affordable energy.

We just renamed this chart ‘The Empty Quadrant’ to call attention to the bottom right of the graph. That’s where high-income, low-energy countries would be if they existed. They don’t.

Read more about the latest update or check out the interactive graphic.

The Rings of Growth

Governments and companies are scouring Africa to secure minerals and metals. They care about their own national security and supply chain diversity. New deals must, of course, also benefit Africa. But here’s the catch: many resource-rich African countries are still stuck as extraction cash cows. They risk gaining little from all this attention.

So how will it be different this time? How can Africans turn the surge of minerals interest into broader, lasting economic benefits? The short answer: energy.

Here are three Rings of Growth that show how mining can drive long-lasting energy and jobs:

Read more about the Rings.

Dammed and Dismissed

Despite expanding solar and wind energy use, hydropower is still by far the world’s largest source of renewable energy and the biggest contributor to clean grids.

In 57 countries, renewable energy makes up more than half of electricity generation. In 48 of those countries, hydropower contributes 40% or more to their power supply. For regions like Africa, where it remains under-tapped, the lack of recognition hides hydropower’s role and skews policy and investment decisions.

Check out the interactive version of the map. And read why this data matters in decision making.

The Nuclear Export Gauntlet

Many countries are increasingly interested in nuclear as firm, clean power. And novel small modular reactors could be the right size for many emerging economies.

The United States is one of three top suppliers of nuclear technology, and is competing with the other two, China and Russia, for influence and market share. Yet any US nuclear company eager to export their reactors must run a complex gauntlet of government offices and regulatory approvals.

We mapped out exactly what it takes: 25 offices across 8 federal agencies.

Our approach: We conducted a rapid scan of 25 public, mining-related energy projects, both planned and recently commissioned, through November 2025, identifying projects across 10 African countries. This is not exhaustive; it represents what we could find through public announcements and press releases, but the patterns are instructive for understanding how the sector is navigating power challenges.

Here are the major trends we found in the announcements:

• Mining companies are pursuing both captive power and grid-based solutions. Of the 15 generation projects, eight were captive (self-owned and self-used by mining companies), and seven were grid-connected. And 10 were planned transmission projects connecting mines to regional grids. Three of these transmission projects are explicitly using guaranteed long-term demand from the mines to make infrastructure investments financially viable. This shows mining companies are pursuing both on-site independence and grid-based solutions.

• Low-cost renewables and cross-border electricity dominated investments. Almost all generation projects were solar PV, with three even pairing with battery storage. A majority of the planned transmission projects connect power export from hydro-rich but low-local demand countries like Ethiopia, Tanzania, Mozambique, DRC, or Angola to mining activities across southern Africa. Near or far, low-cost renewables are powering mining activity in Africa.

• The scale of grid-connected generation to supply mining surpasses expectations. Purely captive installations tended to range from 5-52 MW. The grid-connected generation projects that some mining companies are developing were 100 MW or greater. In Zambia, First Quantum alone is developing two projects totaling 430 MW, more than what the country added to its entire grid between 2021 and 2023. This suggests mines are building permanent power infrastructure, not just temporary emergency backup.

But, policy response to these trends has been inadequate:

• Mining is anchoring power investments, and policy must extend its impact. Mining companies are investing in large-scale generation and anchoring long-term energy offtake agreements for transmission infrastructure. With rising demand for African minerals, this dynamic will intensify. Policymakers must strategically use these demand centers and ensure national and regional growth plan alignment to extend benefits beyond the mine fence and the pocketbook of select companies.

• Grid defection is not inevitable or binary → utilities can win back their largest consumers. Rather than fully defecting, companies are investing in both self-generation and grid connectivity to hedge against unreliable or unavailable supply. This creates an opportunity: utilities that improve reliability can retain high-load, creditworthy customers like mining operators — while helping firms avoid the cost of duplicative, self-supplied power systems.

• Regional transmission and power exports: duplicative or strategic? Almost all of the cross-border transmission projects target southern Africa’s mining sector as a key offtaker. This is happening as mining operators continue to acquire self-generation, countries like Zambia rush to sign lots of power deals to increase local power supply, and Mozambique is likely to have excess power from a large smelting closure. It’s unclear whether these regional exports are a coordinated response to a clear demand call or if countries are competing for the same few sets of large industrial consumers. Policymakers, utilities, and development financiers need to take a regional view and ask the hard questions about demand, timing, and trade-offs.

Mining energy demand in Africa is large, but the response is falling short due to limited information. If our rapid, limited scan of recent project announcements is any indicator, the scale of power demand for the mining sector is large; the unmet demand is likely larger. In response, mining companies are developing parallel on- and off-grid power systems, while governments are pursuing costly regional transmission projects to secure the few key demand centers. Yet all of this is unfolding with limited publicly available information on how mines are powered, whether they are grid-connected, their tariff arrangements, on-site generation capacity, or how demand would evolve under reliable supply. Operating under this major blind spot, utilities and decision makers are missing key investment opportunities and pursuing incomplete solutions.

Written by Meron Tesfaye and Daniel Johansson, originally published on May 14, 2026 on The Energy for Growth website.

Weak governance, not lack of capital, is the binding constraint on energy investment

“I keep coming back to governance,” said Morris. “These are attractive markets. But where investment is falling short, it’s too often because of regulatory gaps, weak institutions, and lack of legal certainty.”

Across much of Asia, demand for power is strong and investor interest is high. But underlying structural issues continue to slow progress. State-owned utilities often dominate the sector, regulatory systems face capacity constraints, and ministries of finance frequently lack visibility into long-term obligations created through energy contracts. While MDBs can provide financing or guarantees, Morris emphasized that these tools cannot substitute for strong governance. “You want to address the underlying issues that cause investors to pause,” he said.

Targeted interventions deliver results where broad reforms fall short

ADB has traditionally supported broad, sector-wide reforms through policy-based lending and technical assistance. These programs aim to improve regulation, strengthen institutions, and create more competitive markets. But implementation is often slow and politically difficult. “You can identify a hundred reforms,” Morris noted, “but it’s a particular challenge to find the reform that is easily verifiable, politically achievable, and ultimately has real impact.”

This has led ADB to focus on more targeted interventions, including PPA transparency. “These are achievable commitments,” Morris said. “You either disclose contracts or you don’t. It’s not trying to fix everything at once, but it can have powerful effects.”

Power contract and debt transparency are two sides of the same coin

ADB’s new technical assistance program on governance and PPA transparency in the Kyrgyz Republic, Lao PDR, and Tajikistan reflects this shift. These countries face a combination of rising debt risks and strong potential for energy investment, particularly in renewables. In Lao PDR, for example, limited coordination between state-owned enterprises and the finance ministry has contributed to hidden liabilities. “There’s too little visibility into what’s happening through SOEs and joint ventures,” Morris explained. “That’s what leads to these underlying debt issues.”

At the same time, these countries are well positioned to benefit from growing regional demand for electricity, including plans for greater cross-border power trade in Southeast Asia. But without stronger governance, these opportunities may not translate into investment. “If countries can address these issues,” Morris said, “this can be a real driver of economic growth.”

Morris also highlighted the strong connection between energy contract transparency and sovereign debt transparency. Hidden liabilities from long-term PPAs can create fiscal risks similar to undisclosed public debt. While the debt world tends to focus more on avoiding crises, the transparency world aims to improve the status quo. “It’s not just about preventing bad outcomes,” he said. “It’s about building more robust markets.” By making contracts visible, governments can better assess fiscal exposure while also creating a more predictable environment for private developers.

Sustained reform depends on local champions and long-term engagement

Ensuring that these reforms last beyond initial programs requires sustained engagement. Morris emphasized the importance of identifying reform champions within government and supporting them over time. “You need people who are committed,” he said. “And then you invest in them and give them the resources they need.” ADB’s technical assistance model allows it to provide flexible, ongoing support, including embedding experts and responding directly to government needs.

Reflecting on his experience in government, think tanks, and now an MDB, Morris also stressed that influencing policy requires more than strong analysis. “You can’t treat the (policy) paper as the end goal,” he said. Effective engagement requires understanding how policymakers operate, maintaining long-term relationships, and repeatedly communicating key ideas. “A lot of it is education,” he added. “You have to stay engaged.”

ADB’s approach provides an early example of how MDBs can move from principle to practice on contract transparency. By supporting disclosure through context-specific technical assistance and integrating it into broader governance reforms, MDBs can help governments reduce hidden risks, strengthen institutions, and attract more investment.

As MDBs look to scale up energy investment in emerging markets, ADB’s experience shows that targeted, practical reforms like PPA disclosure can be an effective place to start.

Written by Hamna Tariq and Mohamed Rali Badissy, originally published on May 4, 2026 on The Energy for Growth website.

The crisis forced a shift from bailouts to structural reforms

For over a decade, South Africa’s state-owned utility Eskom kept the lights on through bailouts and emergency diesel generators. The cost: massive debt, deteriorating coal plants, and daily blackouts.

By 2023, power plant availability had dropped to 55%, meaning nearly half of Eskom’s generation capacity was offline at any given time.

The power crisis stemmed from operational failures at Eskom that left plants vulnerable to breakdowns, and a closed market that blocked private companies from filling the gap. For years, the government provided bailouts that allowed Eskom to finance emergency fixes rather than address the root problem — poor maintenance.

In 2023, the government changed course.

Under the Eskom Debt Relief Act, the government took on 254 billion South African Rand (ZAR) (~US$15 billion) of Eskom’s debt but blocked the utility from borrowing more. The debt relief came with strict conditions: focus on maintaining existing plants, no new generation projects, and no new debt.

This forced Eskom to fix operational problems rather than finance its way out.

The government addressed utility operations and opened markets to private generation.

Coordinated through Operation Vulindlela (the presidential unit established to oversee reforms), the government pursued a two-part strategy:

• Fix what the utility can control. Eskom’s Generation Recovery Plan focused on intensive maintenance of existing coal plants, restoring 5,506 MW of capacity within one year, faster and cheaper than building new plants.

• Empower others to do what the utility can’t. The government opened the market to private generation through two mechanisms:

  • Self-generation: In 2021, the South African government raised the licensing threshold for embedded generation from 1 MW to 100 MW, and subsequent reforms removed the cap entirely, eliminating licensing requirements for most private generation projects. The Electricity Regulation Amendment Act of 2024 restructured the electricity market by establishing an independent transmission system operator and enabling competitive electricity trading platforms. These reforms reduced regulatory barriers and enabled companies to use domestic banks for faster financing without requiring sovereign guarantees or complex project finance structures.

  • Independent procurement: The Renewable Energy Independent Power Producer Procurement Programme bypassed Eskom for large-scale grid-connected energy. It created an Independent Power Producer Office to manage competitive auctions where developers bid to build utility-scale renewable energy projects under standardized contracts. This reduced transaction costs and removed Eskom’s conflict of interest in procuring power that could compete with its own generation.

The results: 300+ days without blackouts and ZAR200 billion in private investment.

Fixing utility operations while opening markets to private generation delivered measurable results:

• Eskom’s operational turnaround stabilized the grid. As of March 2026, South Africa has achieved 308 consecutive days without load shedding. Eskom saved ZAR9 billion (~US$550 million) in diesel costs year-on-year (a 59% reduction) by operating plants efficiently rather than relying on emergency generators.

• Private capital unlocked new generation at scale. Companies built 5,000 MW of solar capacity within 18 months of the licensing cap removal, with another 12,000 MW in the pipeline. The Renewable Energy Independent Power Producer Procurement Programme delivered multiple rounds of renewable energy procurement through transparent auctions where private developers bid to sell power to Eskom and other utilities via long-term contracts, attracting ZAR200 billion in private investment, and reducing dependence on Eskom’s aging coal fleet.

Together, these reforms strengthened the country’s economic growth outlook. GDP growth forecasts climbed from 1.3% in 2025 to 1.6% for 2026 and nearly 2% for 2027, as businesses regained confidence in power supply.

Two lessons for governments overseeing underperforming utilities

For African governments overseeing underperforming utilities, South Africa’s experience demonstrates how regulatory reforms can unlock results without waiting for new infrastructure or external capital.

• Prioritize operational reforms before investing in new capacity. Before building new power plants, assess whether maintenance and operational discipline at existing facilities can close the supply gap. Intensive maintenance programs can restore capacity years faster and at lower cost than new construction.

• Remove barriers to private participation when utilities can’t deliver. Governments should pursue two mechanisms: First, eliminate licensing caps that block private companies from participating in electricity infrastructure. Where creditworthy companies and functioning banks exist, businesses can finance projects using their own credit (rather than requiring government guarantees), filling capacity gaps faster. Second, create an independent office outside the utility to manage competitive procurement. This removes conflicts of interest and mobilizes private capital at scale.

South Africa’s turnaround offers a test case for what regulatory reform can achieve. By removing licensing barriers, creating independent procurement offices, and forcing operational discipline, the government unlocked existing domestic capacity faster than waiting for donor funding or new infrastructure. The next phase will reveal whether these gains can be sustained as Eskom navigates its financial challenges and transmission privatization moves forward. But the lesson is already clear: fix what utilities can control, empower others to do what they can’t, and don’t wait for perfect conditions to start.

Written by Daniel Johansson, originally published on April 30, 2026, on The Energy for Growth Hub website.

The bill addresses one of the central problems plaguing US efforts to deliver abundant, more reliable electricity to strategic allies: interagency coordination.

You might roll your eyes at a call for better agency coordination. But it matters (and it’s not a lost cause!). While the United States has multiple agencies and tools to promote energy security in our strategic partners, those agencies and tools don’t work together well enough — or at all. This bill attacks the problem at its core in an effort to increase US investments in global energy infrastructure.

I’ll share two illustrative examples of how the failure to work together is paralyzing progress on global energy security:

• The State Department provides technical assistance to strategic allies like the Philippines to strengthen its power sector, creating ideal conditions for US energy providers to invest. But lack of strategic focus and coordination from the US Export-Import Bank to support follow-on investments would leave these new opportunities to Chinese companies. And China’s influence is already profound: the Philippines houses nine US military bases that all rely on a national grid partially owned by China.

• Or the Millennium Challenge Corporation rehabilitates the electricity grid in Cote d’Ivoire, supporting a growing economy and regional power pool. But the US International Development Finance Corporation isn’t mandated to take advantage of those investments and bring more business, including US firms, into that market.

Global energy security demands US agency collaboration and a robust assistance-to-deal pipeline that does not depend on ad hoc agency relationships.

The Energy Security Pact Act is well set up to tackle these kinds of challenges. The bill requires up-front planning and coordination with a selected strategic partner before operations begin, rather than hoped-for follow-on attention after the United States has begun investing.

Over a 10-year period, an Energy Security Pact would bring US grant funding to a partner country to build public infrastructure and reform the regulatory regime. The pact would then use US private sector expertise and concessional finance to expand and use that reliable electricity to grow industries and create jobs.

This bill, coupled with the DOMINANCE Act introduced by Representatives Young Kim (R-CA) and Ami Bera (D-CA) in January, offers the best chance for transforming strategic allies’ energy sectors.

Now more than ever, energy security is critical for the United States and critical for our strategic partners. In these countries, reliable, abundant energy is necessary to transform economies and create jobs. The Energy Security Pact is a creative, bipartisan, bicameral solution to make that reality happen.

Five ways the disruptions are damaging African economies

1. Fuel import bills are forcing governments to choose between raising prices and expanding subsidies. When global oil prices rise, fuel import costs increase because African countries are price takers in global markets with no ability to negotiate lower rates. Governments must either raise pump prices (politically costly) or expand subsidies (fiscally costly).

   • As of March, Egypt’s pound has lost 7% of its value since the start of the war as Suez Canal revenue declined due to decreased traffic, creating a feedback loop where currency depreciation makes fuel imports even more expensive.

   • In April, Zambia suspended fuel taxes for three months, forfeiting $200 million in revenue at a time when the country is restructuring debt and trying to reduce its budget deficit.

   The test will be whether governments can maintain these subsidies beyond a few months, or if fiscal reality forces politically painful price adjustments that could trigger unrest.
   

2. Oil exporters are losing despite higher crude prices because they lack refining capacity. Countries that produce crude oil but lack domestic refining must export crude and reimport refined products at global prices. Higher crude revenues don’t offset the cost of importing fuel.

   • Nigeria exports crude, but imports refined products. Lagos business owners report that fuel costs have doubled or tripled, limiting operations despite the country being an oil producer.

   • Angola is expanding refining capacity through the $6 billion Lobito Oil Refinery (200,000 barrels per day), with Zambia in partnership talks to reduce its dependence on imported refined products. The crisis may accelerate a broader shift toward domestic refining across the continent, a move that could reduce vulnerability to external shocks, though financing and execution remain major hurdles.

3. Fertilizer supplies have collapsed, threatening food security. Fertilizer shipments through the Strait dropped 92% from February to March. Gulf states supply up to 25% of Africa’s nitrogen fertilizers, with East and Southern Africa most exposed.

   • When fertilizer becomes scarce or expensive, food prices increase, hitting Africa hard since households in many of the biggest economies on the continent spend nearly half their income on food.

   • Rice supplies are also at risk. Asian countries are major rice exporters, and higher fertilizer prices due to reduced Gulf shipments threaten to lower supply and increase prices for African importers.

4. The Strait disruptions are cutting off industrial inputs, disrupting manufacturing and mining. Shipments of industrial raw materials through the Strait fell 93% in March. This includes sulphur for mineral processing, limestone for cement, and gypsum for construction.

   • Zambia and the Democratic Republic of Congo rely on imported sulphur for copper processing. Domestic production covers only 15-20% of mining sector requirements.

   • Iron ore exports dropped 65%, and steel shipments fell 93%, disrupting construction and manufacturing across Nigeria, Egypt, Kenya, and Tanzania. For economies trying to industrialize and diversify away from commodity exports, losing access to basic industrial inputs at this scale sets back progress.

5. Higher fuel costs are pushing power systems toward crisis. Diesel and heavy fuel oil are widely used for backup generation, peaking capacity, and self-generation by firms facing unreliable grids. Even where oil’s share in total generation is modest, these sources often set the marginal cost of electricity.

   • When fuel prices rise, utilities face higher operating costs. Governments will now choose between tariff increases, subsidies, or delayed payments.

   • The result is typically higher electricity prices, financial stress in utilities, and deteriorating service reliability. Watch for utilities rationing power or accumulating arrears — both are early warning signs that the fiscal shock is becoming a larger crisis.

Two ways some countries are benefiting in the short term

Shipping companies avoiding the Strait of Hormuz and the Red Sea are rerouting vessels around the Cape of Good Hope, creating a surge in traffic for African ports.

1. Rerouted shipping is increasing traffic at African ports. Shipping companies are rerouting vessels around the Cape of Good Hope. Kenya’s Lamu Port received 74 vessels since January, about a third of all ships serviced since opening in 2021. South Africa’s Port of Cape Town recorded a 112% rise in vessel traffic. But increased traffic doesn’t automatically translate into revenue.

2. Offshore services and bunkering hubs are capturing increased business. Companies providing crew changes, spare parts delivery, and medical evacuations are seeing increased demand as vessels seek to reduce downtime without making unnecessary port calls. Smaller ports are also capturing more of the bunkering business. Mauritius saw bunker calls rise 42% in March, with fuel demand up 58%. Namibia’s Walvis Bay and Togo’s Port of Lomé are positioning themselves as strategic alternatives.

This represents a potential growth opportunity for African maritime industries, though it is unclear whether the shift will outlast the crisis or fade once Middle East tensions ease.

What this means for African economies

African economies face higher costs for energy, food, and industrial inputs while losing revenue from suspended taxes and reduced trade flows. Higher import bills widen trade gaps while weaker currencies make imports even more expensive, creating a cycle where the initial shock gets worse. For countries emerging from debt restructuring, revenue losses undermine deficit reduction and threaten debt sustainability, while structural dependence on imported fuel, fertilizer, and industrial inputs constrains the growth needed to service debt and create jobs.

Written by Daniel Johansson, originally published on April 20, 2026, on The Energy for Growth Hub website.

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In a bold statement, Ghana’s energy minister is shunning secrecy and shining a light on its electricity agreements. Not long ago, the country was a textbook case of how power sectors go wrong. Deals were negotiated in the dark and disclosed selectively, resulting in excess capacity, mounting arrears, and rigid payment obligations. Dozens of power purchase agreements (PPAs) eventually had to be renegotiated and cleared at huge cost. The Ministry of Finance recently spent roughly $1.5 billion to stabilize the energy sector, which bought time, but did not fix the underlying system that created the problem.

Ghana is moving from one of the continent’s most troubled energy sectors toward leading in governance

The country’s reform path is starting to take transparency, planning, and procurement discipline seriously. Contracts are becoming recognized as central — not peripheral — to how markets function. Here’s what’s happened:

• In 2023, the regulator launched a public register of active PPAs, a first step toward a more transparent and credible market.

• In 2025, competitive procurement was formalized under the Energy Commission’s regulations (L.I. 2508), replacing discretionary deal-making with structured bidding and reducing the space for poorly structured contracts.

• Last month, Ghana’s Energy Minister Hon. John Jinapor, at a meeting of the Open Government Partnership (OGP), announced that all PPAs will soon be published on the Ministry’s website.

These steps all matter because, as we’ve seen in South Africa and other countries, markets only work if the system is visible. Competition without transparency is just another closed process. If contract terms, evaluation criteria, and risk allocations are not accessible, then there is no way to verify outcomes or enforce discipline.

And this moment for transparency matters beyond Ghana!

Power contracts are becoming one of the largest sources of long-term public financial obligations across emerging markets, yet they remain mostly outside debt transparency frameworks. That gap is closing as more countries confront the consequences, including Pakistan, Sri Lanka, and Zambia.

This is the exact shift my colleagues and I have been pushing: disclosure, standardization, and integration of PPAs into fiscal decision-making. Through PPA Watch and work with partners like the OGP and the Extractive Industries Transparency Initiative (EITI), it is gratifying to witness advocacy turn into policy change.

Transparency in the extractive sectors shows what can be done

It’s really not that complicated. African power markets are relatively small and becoming deeply interconnected, which means countries inevitably learn from one another.

The oil, gas, and mining sectors have already demonstrated the value of contract disclosure: it created a shared base of knowledge that allowed governments to benchmark deals, institutions to compare approaches, and agencies to coordinate more effectively. Disclosure did not completely eliminate risk, but it made poor decisions easier to identify and harder to defend.

The same logic applies to power. Focusing only on the headline tariff, which most countries publish, misses the real story. What matters is how that tariff is constructed and the embedded obligations — from sovereign guarantees and foreign exchange exposure to payment terms — that can ultimately bind the public balance sheet. Without visibility into those elements, it is difficult to assess whether a contract is sustainable, let alone comparable. Opacity creates market uncertainty for governments and private investors alike, raising costs and harming everyone.

Ghana now has a chance to move ahead of the curve. Competitive procurement introduces discipline at the point of entry, but transparency will ensure that discipline holds over time.

While disclosure will be a huge step forward, the problems will not be solved by uploading a few contracts to a website

Real transparency will require a system that does not fall apart after a well-meaning politician is out of office. It requires:

• Embedding disclosure into the legal and regulatory framework so it survives political cycles.

• Creating a central platform where contracts, amendments, and procurement data are published in a consistent and usable format.

• Making the information usable by those who need it. If disclosure does not feed into budgeting, tariff setting, and fiscal risk analysis, then it is not doing its job.

Fortunately, Ghana can adapt workable models from extractives and public procurement.

Ghana has already shown it can respond to crises. The harder task will be creating an open system that prevents the next one — and puts the country on a firm path toward reliable, low-cost power to meet the economic ambitions of the nation. The government’s commitment to power contract disclosure is a serious step forward.

Written by Rushaiya Ibrahim-Tanko, originally published on April 15, 2026, on The Energy for Growth Hub website.

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BLUF: South Africa’s Supreme Court of Appeal has ruled that Eskom must disclose its coal and diesel procurement contracts, rejecting the utility’s commercial sensitivity arguments after a nearly four-year legal battle. The ruling is a genuine win for transparency, but it also exposes a deeper and more troubling gap: the clear public interest that made this victory possible does not extend to the power purchase agreements that are increasingly the dominant mechanism through which consumers’ electricity costs are set. The real lesson from South Africa is not how to litigate your way to transparency. This is why proactive disclosure needs to be the default for all energy contracts, regardless of what is being procured or who is doing the procuring.

The South African public just won the right to see Eskom’s coal supply contracts

Eskom is Africa’s largest power utility, supplying more than 80% of South Africa’s electricity, almost entirely from coal. Coal is its single biggest expense, with every rand of that spending ultimately passed through to South African electricity consumers. The contracts that determine those costs are among the most consequential public documents in the country. Yet until this week, they were completely hidden, even though Eskom is a publicly owned utility procuring fuel under public procurement rules.

In June 2022, activist groups filed a formal request under South Africa’s Promotion of Access to Information Act for copies of Eskom’s coal and diesel purchasing and transportation contracts. Eskom denied the request, claiming commercial sensitivity. The groups challenged the refusal in the Pretoria High Court, won in 2024, and then watched as Eskom appealed. The final ruling denying Eskom’s confidentiality arguments and upholding the public’s right of access came on March 23, 2026: nearly four years later.

Four years. For information that any electricity consumer in South Africa has a direct and legitimate interest in seeing.

The ruling made three hugely important points about contract transparency

The court’s reasoning articulates three fundamental tenets that apply well beyond this specific case:

• Commercial sensitivity is not a blanket shield. The court found no evidence that disclosure would cause actual harm to Eskom or its suppliers. An unsubstantiated claim of confidentiality does not override the public’s right to see the contracts. This matters because “commercially sensitive” remains the standard first line of defense for utilities resisting transparency in markets from Southeast Asia to sub-Saharan Africa to Latin America. South Africa’s courts have now found that defense insufficient. Other jurisdictions and their regulators should take note.

• Public contracts paid for by the public belong to the public. Judge Elizabeth Baartman’s ruling was unambiguous: “The public, in whose interest Eskom concludes these contracts, has a right to access them.” She found “nothing to support the allegation that the agreements are confidential, contain information that is commercially sensitive, and would disadvantage Eskom or third parties in contractual negotiations.” The court’s reasoning applies equally to power purchase agreements (PPAs) and any other long-term energy deal where private costs become public obligations. If the public bears the cost and the risk, the public deserves to see the contract.

• Secrecy in public contracting is unconstitutional. The court went further, framing opacity itself as constitutionally impermissible: “Decisions made in secret and without public knowledge is anathema to the statutory framework, and to our Constitutional norms.” This is a sweeping statement that extends well beyond coal supply contracts. It is a direct challenge to the culture of secrecy that has surrounded Eskom’s contracting for decades, and a signal to other publicly owned utilities across emerging markets that the same challenge could come for them.

These same principles should also apply to electricity contracts with private producers

The Eskom case reveals an unfortunate contradiction in modern power markets. The coal contracts had to be disclosed because Eskom, as a publicly owned utility procuring fuel, was subject to public procurement and access-to-information laws. But consider what changes if you move one step up the energy supply chain: if Eskom were instead buying power from a private independent power producer (IPP) running a coal-fired plant, the contracts governing that arrangement, determining the same electricity costs, paid by the same consumers, would in most cases remain entirely confidential. Same public cost. Same ratepayer bill. No disclosure obligation.

The point is not that private participation in energy markets is a problem. IPPs bring essential private capital to electricity sectors that are chronically underinvested, and that role becomes more important, not less, as the energy transition accelerates. The point is that the move toward IPP-based generation removes the last remaining legal hook, public procurement law, that currently compels any disclosure at all. As more and more power capacity is built by private developers under long-term PPAs, the contracts that most directly determine what consumers pay for electricity are migrating precisely into the category that transparency law reaches least effectively.

It is worth being precise about what “not knowing” means in the PPA context. The headline tariff, which is what a utility agrees to pay per unit of electricity, is often already public. That number alone tells you almost nothing. What the public cannot see is what produced the tariff and what comes with it: the pricing formula, cost components, assumed returns, and any subsidies or tax breaks that shaped the rate; and the non-price obligations that can dwarf the tariff itself, including sovereign guarantees, currency exposure, fuel cost pass-throughs, and force majeure protections that can leave the public paying for a plant that is not generating. It is not the price of the coal going into a power plant that is hidden from the public: it is the components of the price of the electricity coming out of it, and the full range of obligations attached to it.

Four lessons for other emerging markets:

South Africa’s ruling offers a replicable framework for transparency in energy contracting, but the deeper takeaway is about building systems that do not require years of litigation to get basic contract information to the public.

• Proactive disclosure should be the norm, not the exception. Governments and regulators should require publication of key energy contract terms as a standard condition of all power sector transactions, fuel supply contracts, and PPAs alike, whether the counterparty is a public utility or a private developer. This does not mean disclosing every commercially sensitive detail. Phased disclosure and targeted redaction can protect legitimate confidentiality interests while ensuring that the pricing formulas, risk allocations, and contingent liabilities that directly affect consumer tariffs and public fiscal exposure are public.

• The disclosure obligation should follow the public cost, not the procurement category. The Eskom ruling was made possible by the specific legal framework governing a publicly owned utility’s procurement. But the underlying principle that the public has a right to see contracts concluded in the public interest is not and should not be limited to that narrow context. Policymakers designing transparency frameworks should anchor obligations in economic substance: whenever a contract creates costs, contingent liabilities, or risk exposures that are ultimately borne by electricity consumers or guaranteed by the state, disclosure should be required, regardless of the legal form of the transaction or the ownership structure of the parties.

• Litigation should be a bridge, not the destination. The pattern of civil society groups using available legal tools to force accountability in power contracting is global. In South Africa, litigants sued under the Promotion of Access to Information Act. In Kenya, litigation under environmental law blocked the controversial Lamu coal plant and forced public scrutiny of a project that had been approved with minimal transparency. In the Philippines, consumer groups used procurement law to compel Meralco to subject seven sweetheart coal power deals, negotiated directly with its own subsidiaries, to competitive selection, after the Supreme Court found that without it, there was ‘no assurance of the reasonableness of electricity rates charged to consumers.’ In each case, the litigation succeeded. In each case, it took years and considerable resources. And in each case, it should not have been necessary. The contracts that determine what people pay for energy, whether they cover fuel supply or power purchase, whether they are signed by public utilities or private developers, should be accessible as a matter of public interest.

• Build the analytical capacity to use disclosed information. Securing access to information is only half the battle. Governments, regulators, civil society organizations, and journalists need the technical and commercial expertise to analyze energy contracts, interrogate pricing formulas, and identify the hidden obligations that a headline tariff number alone will never reveal.

Conclusion: Don’t Wait for a Court Case

South Africa’s courts have made a clear point: Eskom’s contracts should be public by default, and any opposing claims of ‘commercial sensitivity’ need evidence to support them. That is a landmark victory for both transparency advocates and electricity consumers.

But it should not take years of litigation to access contracts that determine tariffs and fiscal exposure. Power purchase and fuel supply contracts shape public finances, and they should be disclosed by default.

Other countries are already doing this. Argentina publishes contracts and auction results. Brazil publishes pricing data, and Ghana has a PPA register.

South Africa’s ruling shows the cost of delay. Coal contracts are now being disclosed; the long-term power contracts with private developers, which carry pricing and risk allocation, remain largely out of public view.

The question for policymakers and regulators everywhere is whether they want to close that gap now or wait for a court case to do it for them.

Written by Mohamed Rali Badissy, originally published on April 6, 2026, on The Energy for Growth Hub website.

What’s the cost of the power crisis to Nigeria’s economy?

One number dominates the conversation, but it has no source. For eight years, a single estimate — claiming that unreliable electricity causes an annual GDP loss in excess of $25 billion — has served as the definitive economic measure of Nigeria’s power problems. It has appeared in World Bank publications, academic research, Bloomberg articles, and Standard Bank reports, shaping the world’s understanding of both Nigeria’s specific challenges and the degree to which energy poverty holds back economies in general.

But there’s one problem: it’s a ‘zombie statistic’. Zombie statistics are endlessly repeated, but without verification or context. We dug into it and (as far as we can tell) it first appeared in the Federal Government of Nigeria’s 2018 Power Sector Recovery Programme (page 17). Yet the $25 billion figure includes no calculation, methodology, or underlying assumptions. It’s since been repeated by countless trusted researchers and institutions, but we have no idea whether it’s anywhere close to accurate.

The $25 billion statistic does have some value. Compelling, eye-catching statistics fill important gaps in our understanding of complex problems. Even if they’re not exactly accurate, they can illustrate the scale and urgency of a problem. This one successfully communicates the (very real) point that unreliable power creates significant economic drag – and can therefore help mobilize resources and attention to fix it. In practice, the actual dollar figure doesn’t matter as much as the broader point: that unreliable electricity means massive economic harm.

But it also holds us back. Without a credible way to measure the economic impacts of power outages, we cannot fairly assess the scale of the problem or its importance relative to other barriers. Does the $25 billion figure measure the economic damage from lost production, generator costs, or suppressed demand? We don’t know. Without this clarity, driving specific policy interventions becomes difficult. When widely-used statistics lack clear assumptions or calculations, it can also lead to mistakes in what gets funded, who cares about it, and which solutions are ultimately tried. We need to do better.

Three ways we can improve how we measure power service gaps.

More transparent methodologies and a better use of existing data are a good start. The development finance community has several opportunities to strengthen how we estimate impact:

1. Make estimates transparent. Even rough calculations become more useful when assumptions are clear. Knowing how $25 billion was arrived at and what it’s measuring helps calibrate responses appropriately.

2. Invest in rigorous economic impact research. Robust studies using transparent methodologies can reveal how outages affect employment, productivity, business formation, and broader economic impact. New tools that map consumption patterns at the building level enable development institutions to track economic impacts dynamically and measure whether interventions are actually working. Recent efforts demonstrate what’s possible: Justice Mensah’s work across African countries shows which sectors and skill levels are most affected by outages. Open Energy Maps uses machine learning to track building-level consumption patterns, enabling measurement of grid reliability over time.

3. Use the operational data we already have to target interventions. The 2018 report contains valuable metrics that could better guide operations: 22 system collapses in 2016, details on tariff shortfalls by distribution companies, and collection rates by region. These granular numbers offer a roadmap to targeted interventions. The same attention given to headline economic figures could be applied to system collapse frequencies, transformer failure rates, and collection percentages.

Creating space for uncertainty. Not having precise measures for everything is a normal part of economic policymaking. The Nigerian government report notes that suppressed demand remains unmeasurable and self-generation is largely untracked. But much greater transparency can help focus efforts on what we can and should measure — and make Zombie statistics based on mysterious assumptions less ubiquitous.

Written by Daniel Johansson and Katie Auth, originally published on March 9, 2026, on The Energy for Growth Hub website.

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Swift and equitable negotiation of power purchase agreements (PPAs) is critical to accelerating renewable energy deployment across Africa and meeting the continent’s energy access targets. As the foundational contract underpinning privately financed power projects, the PPA defines the obligations between the project developer and the power purchaser, typically a state-owned utility, and determines the revenue stream that secures project financing. Given that lenders usually provide over 75 percent of total development costs, the PPA’s structure and integrity are crucial to both financial viability and long-term sustainability. However, despite their central role in power sector investment, persistent myths surrounding PPAs continue to distort governance, inflate public debt, and impede progress on essential infrastructure. Drawing on lessons from Ghana, Zambia, and other comparative experiences with contract disclosure and standardisation, this article challenges five of the most common misconceptions about PPAs and argues that transparency in power contracting is indispensable to Africa’s energy and fiscal future.

Myth 1: PPAs are private agreements between private parties that should enjoy a high degree of confidentiality

In reality, this description applies only to fully liberalised wholesale power markets. It does not reflect how power purchase agreements function across most of Africa. PPAs on the continent are rarely private in any meaningful sense. They are usually signed with independent power producers in environments where governments provide guarantees, oversee the electricity market, or rely on state-owned and state-subsidised utilities as offtakers. The financial implications of these agreements flow directly to citizens through higher tariffs, taxation, or additional public borrowing, which exposes national balance sheets to long-term fiscal pressure. Even when the project developer is a private entity, the offtaker, the guarantor, and the ultimate payer of the costs are public. For that reason, the public has the most significant stake in how these contracts are negotiated and managed.

International financial institutions have repeatedly cautioned against treating PPAs as purely commercial transactions. The International Monetary Fund’s Fiscal Monitor in 2020 emphasised that future government obligations arising from contract defaults can evolve into significant contingent liabilities and contribute to debt distress in low-income countries. Ghana provides a clear illustration. In 2019, the Ministry of Finance reported that payments for unused power capacity under PPAs amounted to around USD 500 million dollars annually, straining the national budget and contributing to the country’s subsequent debt restructuring. The IMF highlighted these risks in its Article IV consultations with Ghana. A similar pattern unfolded in Zambia, where the 2020 sovereign default was linked in part to sizeable off-balance-sheet commitments in the power sector, a point underscored by World Bank analyses.

When the public ultimately bears the financial burden of contract failure, it follows that the terms of these agreements should be open to public scrutiny.

Myth 2: Transparency drives investors away and slows projects

In practice, well-functioning markets depend on information and trust. In many emerging economies, energy project financing carries a heavy risk premium, driven mainly by data opacity and regulatory uncertainty. Governments that worry transparent contracting will expose their decisions to unwelcome scrutiny overlook a simple fact. When investors lack information, they tend to assume the worst about legal, financial, and technical risks. This leads to higher capital costs, which in Africa are two to three times greater than in advanced economies. Transparency is therefore not the obstacle; uncertainty is. Open contracting helps reduce that uncertainty, lowering perceived risk and improving financing terms.

Examples from across the continent illustrate this dynamic. In Zambia, previously undisclosed power-sector arrears amounting to more than one billion dollars in PPA-related liabilities intensified perceptions of sovereign fragility and raised the country’s borrowing costs. The International Finance Corporation’s Creating Markets initiative similarly identifies the absence of accessible contract and sector data as a major reason investors demand higher risk premiums in power projects. Broader fiscal research reinforces these conclusions. Analyses show that greater budget transparency can improve a country’s credit rating by up to one notch and that transparent debt reporting is a stronger predictor of sovereign risk than political regime type. The IMF also finds that increased debt transparency lowers borrowing costs across emerging markets, particularly in states with substantial financing needs.

Investors respond to uncertainty. Open contracting gives market participants a more accurate understanding of project and sovereign risk, strengthening investor confidence and ultimately improving project viability.

Myth 3: Power markets are too different for standard contracts

In practice, African power markets share several core features. State-owned utilities dominate electricity supply, governments provide various forms of public guarantees, and many countries pursue regional power-trade ambitions. Renewable energy projects, especially solar and wind, also tend to follow similar technical designs and risk-allocation structures across the continent.

These commonalities provide a strong foundation for standardised contracts. Model PPAs and uniform templates help streamline negotiations, reduce drafting errors, and lower transaction costs, which ultimately reduces the cost of power. Standardisation is beneficial in smaller or capacity-constrained markets where governments may have limited experience with previous projects and therefore limited knowledge of established contracting norms. Openly sharing and adopting model PPAs enables governments to strengthen their contracting capacity and supports the gradual convergence of legal frameworks across regions. This kind of harmonisation strengthens emerging power pools and encourages fairer, lower-cost contracting practices.

Regional institutions and development partners have long recognised these benefits. The African Development Bank, in its Regional Integration Strategy, has highlighted the value of harmonised legal frameworks and explained that standardised contracts are essential for successful regional power pools. Over the past decade, several governments and multilateral institutions have used standardised procurement models and non-negotiable PPAs, government support agreements, and financing documents to reduce transaction costs and accelerate financial close for renewable energy projects. The Open Solar Contracts initiative offers a practical example of this approach. By making standardised PPA templates publicly accessible, including those used for Barbados’s solar feed-in tariff programme, it shows how replicable contracting models can support transparent and efficient procurement.

Standardisation is therefore not a loss of flexibility. It is an effort to build on proven contractual norms so that negotiations conclude more quickly and agreements reflect fair and sustainable terms. As countries seek greater private investment and deeper integration through regional power pools, harmonised PPAs offer a pathway to affordable energy and more substantial economic cooperation.

Myth 4: PPA debt does not affect national balance sheets

In reality, the financial obligations embedded in power purchase agreements have direct consequences for public debt. This mirrors the misunderstanding that PPAs function as private contracts. Across much of Africa, utilities that sign these agreements remain state-owned or heavily state-funded, which means their payment commitments under PPAs are treated as sovereign liabilities. The IMF’s evolving approaches to accounting for contingent liabilities make this connection increasingly explicit. When governments also issue sovereign guarantees to support these projects, the exposure on national balance sheets becomes even more substantial. Limited transparency around these obligations turns them into hidden debt risks that can undermine fiscal stability.

Recent country experiences demonstrate the scale of the challenge. After Zambia’s 2021 audit, the IMF identified around $1 billion in deferred arrears under PPAs and recognised them as underreported public debt. This finding contributed to the country’s broader sovereign credit crisis. IMF and World Bank public finance analyses repeatedly stress the importance of including contingent liabilities such as PPAs and other public-private partnerships in debt sustainability assessments to prevent destabilising surprises. Empirical studies referenced by the IMF show that concealed debt obligations increase borrowing costs, weaken investor confidence, and heighten the likelihood of sovereign default, particularly in emerging markets.

Debt obligations arising from opaque PPAs present immediate and long-term risks for debt sustainability. Without public insight and stronger oversight, governments may handle these commitments poorly, worsening the debt pressures that already affect many African economies.

Myth 5: Technical complexity justifies confidentiality

In reality, complexity should lead to more transparency rather than less. Complex and opaque agreements make it difficult for governments to benchmark prices and terms, reduce regulators’ ability to provide adequate oversight, and limit officials’ capacity to negotiate stronger contracts in the future. Complexity, therefore, argues for greater openness. Transparent contracts enable data analysis, strengthen accountability, and build institutional expertise over time.

Experience from the extractives sector illustrates this clearly. Countries that have paired complex petroleum and mining contracts with transparency measures, such as regulatory publication requirements, parliamentary review, or public data platforms, have achieved better commercial terms and reduced corruption risks. The Extractive Industries Transparency Initiative’s contract disclosure standard shows that even highly technical petroleum agreements can be published without undermining investor engagement or weakening a government’s negotiating position. Research by the Open Contracting Partnership and the Open Government Partnership further demonstrates that publishing complex infrastructure contracts improves project performance and increases public trust.

In practice, complexity is most effectively managed when data is shared and accessible. Concealment limits institutions’ ability to learn, adapt, and negotiate better deals.

Conclusion and recommendations

Transparency offers a pathway to stronger institutions, better contracts, and a more secure energy future for Africa. Moving beyond long-standing myths about power purchase agreements will allow governments to benefit from the demonstrated advantages of contract disclosure and standardisation. With power sector investments representing multi-billion-dollar, long-term fiscal commitments, and with energy access central to economic growth, transparent contracting becomes a foundation for sustainable development rather than simply an element of good governance.

African governments, therefore, face a clear choice. They can continue relying on outdated assumptions that strain public finances and slow the expansion of reliable electricity, or they can adopt practices that have delivered improved outcomes in other regions and sectors. The myths surrounding power sector contracting have endured for too long. Replacing them with evidence-based approaches will strengthen accountability and deliver the transparency that citizens, investors, and development partners increasingly expect.

A practical four-part framework can help governments implement transparent contracting. The first step is to legislate disclosure so that PPA terms, associated guarantees, and linked fiscal obligations are published as a matter of course. Ghana’s Energy Sector Recovery Programme illustrates the value of this approach. The publication of power-sector arrears in 2019 revealed more than two billion dollars in contingent liabilities and created the conditions for renegotiating problematic agreements.

The second step is to adopt model contracts. Standardised PPA templates adapted to national contexts can shorten negotiation timelines and lower risks. The extractives sector shows what is possible. Countries using model petroleum contracts reduced average negotiation periods from eighteen to six months and secured stronger fiscal terms. Chad’s experience stands out, with its adoption of model petroleum agreements increasing the government’s revenue share by fifteen percent while attracting stronger investors.

The third step is to systematically report contract data. Including PPA-related liabilities in annual debt reports and debt sustainability assessments helps ensure that fiscal risks are reflected in official analyses. The IMF’s debt sustainability assessment for Ghana explicitly identified contingent liabilities from the power sector as a significant source of fiscal pressure. Countries such as Rwanda, which include these obligations in their public debt reports, are better positioned to build creditor confidence and avoid unexpected financial shocks.

The fourth step is to strengthen the state’s capacity to manage these contracts. Establishing specialised contract management units within ministries, utilities, and regulatory bodies allows governments to monitor, oversee, and renegotiate agreements more effectively. Colombia’s experience demonstrates that improved oversight of complex resource contracts can raise government revenues significantly; its dedicated contract management units increased revenue by twenty-five percent. Transparent and competitive procurement should also be encouraged wherever possible. Pakistan’s competitive solar auctions secured tariffs that were sixty percent lower than those negotiated through direct deals. In contrast, South Africa’s renewable energy auction programme procured more than 6,300 megawatts at prices that declined with each successive bid round. These steps offer a route to more resilient power sectors, stronger public finances, and an energy landscape in which Africans benefit from contracts that serve the public interest.

How risky is nuclear power, really?

→ Dispelling the Overblown Security Risks of Nuclear Exports — Jessica Lovering and Hamna Tariq, January 26, 2026

Security concerns are often the first argument critics raise when nuclear energy is discussed — but are they grounded in reality? This piece takes a data-driven look at nuclear security risk narratives and explains why many fears are overstated, what the real risks actually are, and how countries can responsibly navigate nuclear exports.

What should countries considering nuclear know?

→ So, You Want to Go Nuclear? — Daniel Johansson and Hamna Tariq, February 11, 2026

Interest in nuclear power is one thing; readiness is another. With nuclear technology gaining attention and development banks becoming open to nuclear power, lots of countries have a choice to make: Should they add nuclear power to their future mix — and how? Drawing on the experience of the 31 countries that currently operate nuclear plants, this summary details some initial lessons for countries weighing the nuclear option.

Enough hoopla — what should we actually be talking about?

→ Let’s Get Real About Nuclear in Africa — Todd Moss and Hamna Tariq, February 17, 2026

Africa’s nuclear ambitions are real. Many of the announcements driving headlines are not. This piece calls out the three patterns doing the most damage: capacity targets that dwarf existing grids, timelines that ignore years of required preparation, and nuclear being pitched as a fix for basic energy access. The continent’s nuclear potential speaks for itself — hoopla only gets in the way.

For more insights on nuclear and the future of energy in Africa, visit energyforgrowth.org or subscribe to The Hubstack.

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When these energy challenges make the headlines, the conversation usually centers impacts on western countries’ supply-chain security or ‘green transition’ efforts. What gets far less attention: the strains that power challenges are placing on current mining operations and the gigantic negative impacts on the African economies themselves.

Africa’s mining struggles are power and economic struggles

Sub-Saharan Africa’s mining sector, valued at over US$108 billion, is so central to many countries’ economies that its performance shapes overall economic health. In many countries, the sector accounts for half of all exports and the majority of foreign direct investment. Mining contributes a significant share of GDP and makes up a disproportionate portion of the local revenue base of many African countries. As a result, the sector’s struggle to secure reliable, affordable electricity inevitably becomes a national and regional economic struggle.

Electricity shortages in mining → 3 ways African economies lose out:

1. Job losses. Across Africa, unreliable and costly power is costing mining sector jobs. In South Africa, rising electricity prices and frequent outages have triggered thousands of job losses across the ferrochrome and vanadium industries. These job disruptions extend beyond local employment, hurting global energy and transportation manufacturing sectors that rely on them. Steel giant ArcelorMittal South Africa has warned that rising energy costs could trigger 4,000 layoffs, nearly half its workforce. Mozal, Africa’s second-largest aluminum producer and a major power consumer, has announced it will close its smelter in Mozambique after failing to agree on cheaper electricity prices with the government. This will erode the continent’s limited smelting capacity and eliminate value-addition jobs, which tend to pay higher than those in extraction. Job creation is already a top concern for African countries. This doesn’t help.

2. Less local value addition. Many African countries would like to do more than export raw materials: they want to process more minerals at home and use their mineral wealth to build local manufacturing. This won’t make sense everywhere. But electricity shortages are one key factor making it much harder. In Ghana, the lack of reliable power makes lithium refining prohibitively expensive. And in South Africa, the world’s largest ferrochrome producer, the rising cost of electricity (which constitutes the single largest cost in ferrochrome production) has pushed producers to abandon smelting efforts and export raw material instead. A similar trend in the iron ore sector is further entrenching the lack of producer diversity and a system that prioritizes ore exports over steel production. This locks African economies into low-value economic activities, undermining prospects for often-aspired value addition and local wealth creation from mineral resources.

3. Utility revenue loss and death spiral. Mining is a major energy consumer; accounting for ~20% of Africa’s total electricity consumption in 2024 (assuming mining represents about half of industrial electricity consumption). In some countries, like Zambia and Mozambique, this share rises to as much as 50%. This makes Africa’s power utilities, which are already deeply financially insecure, highly sensitive to disruptions in the mining industry. In Mozambique, the potential shutdown of an aluminum smelter would risk more than $300 million in annual revenue for the national utility. And in the DRC, the national utility lost about $4 billion in revenue between 2019-2023 because electricity shortages forced mining companies to either import power from South Africa or rely on backup generators. Across these countries, utilities rely on large industrial consumers for bulk electricity purchase and dependable revenue. As more of these big mining customers are forced to go off-grid, utility performance may decline or tariffs may go up to close the financial gap, worsening conditions for other commercial and residential consumers.

Power constraints are defining Africa’s mining present and future

As the world debates future pathways to supply-chain diversity, costly and unreliable power is already costing African jobs, revenue, and deepening the continent’s vulnerabilities and economic prospects. Africa’s mineral wealth may, in theory, fuel the world’s energy future, but without abundant and affordable power to fuel these ambitions, extraction will falter and any downstream opportunities — for African economies and global supply chains alike — will vanish. African policymakers must therefore insist that energy policy sits at the core of mining policy. If Africa is to maintain current mineral production, let alone expand it, international partners must also advance energy abundance.

Written by Meron Tesfaye, Rushaiya Ibrahim-Tanko, and Katie Auth, originally published on February 4, 2026, on The Energy for Growth Hub website.

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This cleanup will help the country reduce its debt stress and allow the power sector a second chance. The big question is how Ghana avoids ending up here again.

First, the cost of secrecy is painfully high

Ghana’s energy debt did not appear overnight. It accumulated over many years through opaque, bilaterally negotiated, non-competitive power purchase agreements (PPAs) that included undisclosed guarantees. Citizens, investors, and even parts of Ghana’s own government had little visibility into the scale of obligations. At its peak in 2025, total sector debt reached $3 billion. This included liabilities that were not systematically tracked or disclosed, contributing to fiscal strain and undermining investor confidence.

Transparency can help prevent recurrence

Disclosure on its own does not guarantee good outcomes, but it makes bad decisions hard to hide and cheaper to correct. Building up hidden liabilities is simply harder when information is public. Publishing contracts, guarantees, and payment schedules reduces information asymmetry and enables earlier intervention by regulators, ministries of finance, and oversight institutions.

Ghana has made impressive progress

Ghana’s regulator created a public PPA register in 2023. In 2025, parliament passed broader legal reforms mandating competitive power procurement and greater transparency. These create a solid foundation for tracking obligations in real time rather than discovering them after a crisis.

But the next steps are decisive

The debt clearance follows painful reforms under an IMF debt restructuring program, which underscored how energy sector liabilities can spill into sovereign debt distress. Clearing arrears restores confidence for now. But sustainability depends on institutionalizing transparency and ensuring well-procured contracts. That means full and timely disclosure of power contracts, standardizing reporting of guarantees, and public monitoring of payment performance.

Ghana’s experience reinforces a broader lesson for power sectors across developing economies: when large public obligations remain hidden, the eventual bill is higher and harder to manage. Transparency cannot eliminate risk completely, but it could help make crises less likely, less severe, and ultimately easier to fix.

Written by Rushaiya Ibrahim-Tanko, originally published on January 20, 2026, on The Energy for Growth Hub website.

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Industrial growth in developed countries has always relied on abundant energy: No country has become high-income with low-energy consumption, and industrial power is a major piece of that higher consumption. As aid declines, trade terms shift, and political momentum builds around resource extraction deals, African countries are prioritizing pathways to rapid industrialization that will grant them faster economic development and greater geopolitical leverage. Meeting these ambitions will require reliable, abundant energy for industrial activity — a luxury many African economies do not have. Reaching their industrialization goals requires clearly defining the problems, honestly assessing what hasn’t worked, and confronting the hard policy questions ahead.

To that end, the Hub has begun a new initiative to pinpoint Africa’s core industrial energy needs and propose sector- and country-specific policy solutions to power Africa’s growth.

Four power-fault lines of Africa’s industrial prowess

Let’s start with the basics. Africa’s industrial development is constrained by four major energy barriers:

1. Costly and unreliable power undermines existing manufacturing. More than two-thirds of firms in sub-Saharan Africa experience power outages. Unreliable power damages equipment, reduces productivity, and results in staggering job loss. To cope, firms (especially large manufacturers engaged in exporting) switch to producing their own power or relying on back-up systems. This drives up their cost of doing business and erodes much-needed revenues for utilities.

2. Deficient power keeps industries low-tech, low-energy demand. Poor and declining power infrastructure also limits growth by suppressing demand for more sophisticated industrial activities. While existing firms are hurt by unreliable power, the impact is likely even greater on the many firms that never get created in the first place. Africa’s global contribution from medium- and high-tech industries like metals, machinery, electronics, and industrial chemicals has persistently remained less than 2%. Suppressed industrial energy consumption hinders participation in advanced, global supply chains and makes local goods export-reliant and costly.

3. The lack of power stifles efforts to retain more economic value domestically. Because of unreliable electricity, Africa’s minerals (like cobalt or lithium) and high-value agricultural commodities (like cashews and rubber) get exported from the continent with minimal value addition. This locks countries into extractive models and stymies opportunities for diversified growth and job creation. Efforts to expand processing capacity through export quotas and resource-nationalization policies have been undermined by power shortages in places like the DRC, where waivers have become increasingly common. Whatever policies are in place, more processing requires more power.

4. Countries rarely connect industrial demand plans to energy planning. Power plants in countries like Uganda, Angola, and Ethiopia generate more electricity than is used — a ‘build it and they will come’ approach that overlooks the need to couple generation with demand stimulation and distribution infrastructure to drive economic growth. Countries also pursue new demand opportunities, like minerals, hydrogen, and data centers, through behind-closed-door deals that are often isolated from broader planning. This creates unproductive cycles of hype and disappointment, fosters an opaque and inhospitable investment environment, and shortcuts strategic, realistic assessment of demand centers.

Unreliable power results in low-productivity and stalled growth

The four fault lines are different manifestations of weak power infrastructure. Unreliable power forces industrial customers to turn to independent supply or back-up power which increases cost for firms, suppresses new and growing power demand for manufacturing. With fewer consumers, utilities lose resources to maintain or expand energy infrastructure, power remains unreliable and energy systems continue to deteriorate. Economies, as a result, stay concentrated in low-energy activities like extraction, services, and agriculture, limiting production of higher-value goods and deepening dependence on imports for medicine, construction materials, chemicals, and more. This culminates in a self-reinforcing cycle of poor power infrastructure that results in poor economic productivity and growth.

Abundant and reliable energy is the antidote

Solving the perpetual low-power and low-productive cycle not just for a single firm, but in a manner that unlocks growth for an entire nation requires a shift in development policy. That is why we have begun this work by introducing the Three Rings of Growth for energy and jobs. Africa’s current reality is largely Ring 1: limited energy that supports only extractive activities. Today, most African leaders are focused on Ring 2: building energy infrastructure to enable value addition at home. But true economic transformation depends on Ring 3: energy development designed to power a broad range of economic activities, not just specific firms, technologies, or sectors. This is the kind of abundant, reliable power needed to drive industrial growth, job creation, and long-term economic expansion.

Delivering on industrial power means answering hard questions

The need for abundant industrial power is clear. But delivering it through the right mix of policy, investment, and prioritization has proven difficult time and again. Ensuring that power leads to industrial growth depends on factors beyond electricity, including trade policy and geopolitics.

• In the 1960s & 70s, the buildout of large hydropower energy projects anchored to industrial users was initially transformative. But as demand grew, many utilities became locked into non-cost-reflective prices and long contract terms that limited their ability to accommodate new demand or invest in new infrastructure.

• By the early 2000s, hopes shifted to special economic zones and efforts to anchor mining and other industrial activities to the power sector, with few results.

• More recently, optimism has centered on the idea that transformative growth will come once countries tap their renewable potential or ride the latest green-technology wave. The promise was that Africa would grow faster with clean energy.

Each of these approaches to pairing energy with industry have failed to transform industrial growth. In the meantime, countries are relying on diesel generators, small-scale solar, and expensive floating power plants for backup power that cannot support a growing industrial base.

This time, we need to do better. Moving forward, we’ll be asking key questions like:

1. What lessons learned from past short-term triumphs or failed attempts should guide Africa’s latest approach to power industrial growth?

2. Which reforms must be prioritized to ensure industrial firms don’t continue to defect from the grid?

3. How should countries approach captive power and energy infrastructure financing to give industries reliable, high-power options while keeping the flexibility to reconnect to the grid as it improves?

4. Under what conditions does new or existing demand (like mineral processing) translate into broader energy and industrial development?

5. How should countries pair industrial strategy with power-sector planning and incentives to create the strongest catalytic impact on growth?

6. What shifts in investor, multilateral, funder, and national priorities are needed to move beyond extraction and support real industrial growth?

BLUF: The World Bank lifted its nuclear prohibition in June 2025. The Asian Development Bank followed suit in November 2025. Yet other agencies retain legacy bans, limiting countries’ clean energy options and hurting the competitiveness of Western technology.

What’s at stake: Even after recent reversals, only 8 of the 28 major Development Finance Institutions (DFIs) can finance nuclear today. Technology-neutral DFI policies enable countries to choose their own optimal energy mix, while strengthening Western competition against Russian and Chinese nuclear export dominance.

Who else should move?

• The African Development Bank and European Investment Bank are each considering a change.

• The European Bank for Reconstruction and Development could expand beyond nuclear safety to support new nuclear investments in Eastern Europe and Central Asia, especially in countries seeking to break energy dependence on Russia.

• The Islamic Development Bank serves several countries that want expanded nuclear power.

• The European Development Finance Institutions (EDFI) network of 15 DFIs has a common exclusion list; adopting nuclear-positive guidance would help to normalize an open position.

Think you’re too small? Think again

• Smaller players like FinDev Canada, and Swedfund might hesitate given conventional nuclear’s size and cost. But demand is growing for small modular reactors that have lower costs than conventional nuclear power, and small DFI participation sends crucial market signals.

• Policy changes to enable co-financing and wrap-around support like technical assistance or workforce development can open up more financing options for nuclear in emerging markets.

Why timing matters

The first Western, next-generation SMRs are set to be ready for deployment by 2030, but need financing decisions in the near-term to compete internationally. China provides substantial state-backed nuclear financing, while Russia’s state-owned Rosatom dominates reactor exports. Leveling the playing field for nuclear financing depends on more DFIs opening up to nuclear energy.

Table of DFIs

Fertilizer in Africa remains both unaffordable and scarce, trapping millions of people in a cycle of high food costs and widespread food insecurity. Given the continent’s unrealized renewable potential, some advocate that producing hydrogen, a key fertilizer ingredient, using renewable electricity could make fertilizer cheaper and more locally available.

But the short and long answer is no, for three main reasons. Before getting to those, it’s worth setting the stage.

Africa’s food shortage demands more fertilizer, fast!

Africa is the only region where food insecurity has continually worsened since the COVID-19 pandemic, even as the rest of the world recovers. Crop yield growth has remained stubbornly low for decades, leaving average yield in Africa far below the global level. Closing this gap, without expanding harvested land, requires increased fertilizer use.

But fertilizer is too expensive and scarce in Africa

Across much of Africa, fertilizer use is far below local targets and global levels. Only eight countries have met the African Union’s 2015 goal of consuming 50 kilograms of fertilizer per hectare of cropland, which is still less than half of the global average. Sub-Saharan Africa, despite its large population, makes up only 3% of the world’s fertilizer consumption. As a result, even African nations that produce fertilizer domestically, such as Nigeria, prioritize shipments to higher-demand markets abroad. African farmers therefore face a double burden: low fertilizer availability and prices that remain well above the global average.

Some are, understandably, looking to green hydrogen, a building block of fertilizer

Hydrogen is a key ingredient in ammonia, the main component for fertilizer production. Conventionally, ammonia is made from natural gas, which has confined its production to gas-rich regions around the world. But the ability to split water using renewable electricity to make hydrogen (green or renewable hydrogen) has inspired a new vision of decentralized, low-cost, green ammonia and green fertilizer production—even in countries with no natural gas at all. With Africa’s under-tapped potential for low-cost renewables like wind and solar, renewable and hydrogen advocates assert that green ammonia production using green hydrogen is a solution for Africa’s fertilizer security. As a result, a majority of the green hydrogen projects proposed in Africa plan to produce green ammonia. Some countries, like Kenya, are pursuing green ammonia production as a key national strategy for fertilizer security.

But green hydrogen won’t make African fertilizer cheaper or plentiful

These prevailing assumptions, although well-intentioned, won’t deliver within the timeline and scale needed to respond to Africa’s current food crisis. Here are three reasons why:

Reason 1: Green hydrogen needs cheap and abundant power—Africa doesn’t have it yet.

Optimistic projections suggest that green hydrogen production costs could fall well below $2/kg by 2030. Achieving that, however, would require renewable electricity to be priced at less than 2 cents/kWh. Current large-scale solar and wind projects in Africa are closer to 5–7 cents/kWh, thrice the cost of what is needed. Historically, green hydrogen production in Zimbabwe and Egypt thrived on abundant hydropower at 1–2 cents/kWh—a reality that no longer holds, as today’s renewables face high capital costs, financing hurdles, and risk premiums. A recent European modeling study with more realistic financing assumptions found that green hydrogen production costs in Africa are still 3-10 times above global targets, largely due to the high cost of electrolyzers and the vast amounts of power required to split water. Making cheap green hydrogen is a prerequisite for green fertilizer production, and neither green hydrogen innovation nor Africa’s grid is there yet.

Reason 2: Green hydrogen alone can’t make African fertilizer green or cheap.

Beyond ammonia, fertilizer production depends on additional inputs. For example, making urea, the most widely used fertilizer in Africa, requires CO₂, which would have to be captured from fossil sources or cleaner alternatives, like biomass or direct air capture. These options add both complexity and cost. Green technology advocates argue that greener production pathways could be financed through climate funds, which remain limited at best. By contrast, fossil-fuel-based fertilizer production captures CO₂ as part of the reforming process that produces ammonia, giving it a built-in technological and cost advantage. Recent estimates from the Breakthrough Institute show that producing “green” urea—even under the most optimistic hydrogen production scenarios—could double fertilizer costs. Similarly, a World Resources Institute study found that producing “green” diammonium phosphate (DAP) in Kenya would remain more expensive than current fertilizer. With imported fertilizer already prohibitively expensive, greening production won’t make fertilizer more affordable or available in Africa.

Reason 3: Green hydrogen can’t fix Africa’s broken fertilizer supply chains.

In most African countries, fertilizer markets are heavily subsidized yet riddled with inefficiencies and corruption. The World Resource Institute’s study of Kenya’s fertilizer market found that roughly 40% of subsidized fertilizer leaks to non-target groups, is resold at higher prices, and rarely reaches farmers who need it most. Similarly, a 2024 Sustain Africa study covering five African countries found that weak private-sector participation, high interest rates, inflation, and currency depreciation have created a fragile local market ecosystem. Limited importers, high diesel costs, and inefficient distribution networks drive local fertilizer prices further above global averages. Addressing these deep structural and logistical barriers would require green hydrogen to be far cheaper than the global target of $1–2 per kilogram—an unrealistic prospect in the near term and uncertain one in the long term.

TLDR: Green hydrogen is the wrong solution to Africa’s food insecurity

Green hydrogen is an inadequate and costly response to Africa’s urgent food security challenge. The continent lacks the cheap energy, low-cost clean inputs, and efficient fertilizer markets needed to make large-scale investment in green hydrogen viable—or to build an affordable, resilient fertilizer market across Africa. Instead of fueling the green hydrogen hype, policymakers should focus on addressing the root causes of food insecurity by: (1) investing in non-green fertilizer production where the ingredients are accessible; (2) implementing policy solutions that improve fertilizer import, sale, and distribution challenges; and (3) expanding access to affordable and reliable electricity.

Governments and companies are scouring Africa to secure minerals and metals. They care about their own national security and supply chain diversity. New deals must, of course, also benefit Africa. But here’s the catch: many resource-rich African countries are still stuck as extraction cash cows. They risk gaining little from all this attention. So how will it be different this time? How can Africans turn this surge of interest into broader, lasting benefits? The short answer: energy.

Here are three Rings of Growth that show how mining can drive long-lasting energy and jobs.

The first ring is the familiar status quo: Energy for Raw Extraction.

Mining operations are energy-intensive, requiring continuous, reliable, and affordable power. More mining will mean more energy. But in countries like South Africa, Zambia, and Ghana, unreliable and costly power is forcing mines to either shut down or turn to their own private power. Incoming investors, focused on protecting their bottomline, are likely to double-down on standalone power sources that guarantee predictable operations. The result? Higher costs of doing business, fewer jobs, weaker utility revenues, and little local spillover benefit beyond the mine fence.

Africans are asking for the second ring: Energy for Value Addition.

Indignant at the old extraction model, more than 20 African countries have reacted with raw material export bans—with some, like the DRC, even going as far as suspending some mineral exports. Behind these tough policies lies a growing determination to keep more economic value at home. But, moving up to mineral processing and higher-value manufacturing requires even more reliable energy. When done right, the effects can be catalytic: greater market value, better-paying jobs and growth of local enterprises. To capture these gains, governments need to negotiate hard for greater local benefits. Yet without integration into a broader energy strategy, even value-addition efforts can fall short of their promise. Some countries are already facing this reality, forced to lift their export bans after power shortages made local processing impossible.

The third ring should be the real goal: Energy for Economic Expansion.

Mining and processing are large, long-term energy offtakers, so they can be even more valuable as anchors for bankable investments in new energy generation, transmission, and distribution. That same infrastructure can support a far wider range of sectors and communities, driving economic activity and job growth across manufacturing, services, and agriculture. To make this more ambitious approach work, however, requires governments to align industrial strategies with energy planning.

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