Moderating a panel discussion at Africa’s Green Economy Summit 2026 in Cape Town, the Project Development Manager for Energy at the Coega Development Corporation, Mr. Clayton Jacobs, shared his perspectives on Africa’s renewable energy potential and hindrances to realising it:
Africa has enormous renewable energy potential, but building generation, alone, is not enough. A power plant only creates value if the electricity can reach a buyer — and that requires available grid infrastructure, clear trading mechanisms, and investable financial structures.
Many projects stall, not because the resource is weak, but because:
- the grid cannot accommodate new power;
- policy frameworks do not fully enable electricity trading; and
- financing structures make projects difficult to bring to bankability.
This panel discussion focused on practical solutions, including how grid constraints, wheeling models, and innovative finance mechanisms are evolving to unlock projects and move them from concept to commercial operation.
Q: How are grid bottlenecks being turned into innovative solutions?
A: Fundamentally, the grid is a physical infrastructure constraint, and expanding transmission and distribution networks is essential.
However, innovation is emerging in several ways:
- Public-private partnerships and consortium-based grid investments;
- Co-development of generation and transmission infrastructure;
- Embedded generation models close to load centres; and
- Smart grid and digital optimisation tools to improve capacity utilisation.
In some cases, grid scarcity is catalysing collaboration — bringing together utilities, developers, DFIs, and private investors to co-invest in transmission expansion, creating shared infrastructure that enables further renewable rollout. So, while infrastructure build remains central, innovation is happening in financing, structuring, and optimising the grid we already have.
Q: Are wheeling models scalable enough to unlock new markets?
A: Wheeling models are a critical enabler of market liberalisation, but scalability depends heavily on regulatory clarity and digital infrastructure.
In many markets, wheeling is:
- restricted to specific generator–offtaker pairs;
- administratively complex; or
- limited by grid capacity constraints.
To scale wheeling effectively, we need:
- Clear and standardised wheeling frameworks
- Transparent tariff structures
- Digital trading and settlement systems
- Alignment between regulators, utilities, and private sector participants
Where these conditions are met, wheeling can significantly expand market access — particularly for commercial and industrial (C&I) buyers seeking renewable supply. So yes, wheeling can unlock new markets — but only if supported by coordinated policy, digital systems, and grid investment.
Q: In what ways are blended finance and anchor off-takers de-risking projects?
A: Blended finance plays a key role in reducing project risk by combining concessional capital with commercial funding.
This can:
- lower the cost of capital;
- absorb early-stage risk;
- improve debt service coverage ratios; and
- enhance overall bankability.
Anchor off-takers are equally important. A strong, creditworthy buyer provides revenue certainty, which:
- reduces perceived market risk;
- improves lender confidence; and
- enables better financing terms.
The combination of strong anchor offtake agreements, a well-structured debt-equity mix and risk-sharing instruments (guarantees, first-loss capital, etc.), creates a structure where projects can reach financial close more efficiently and with broader investor participation.
Transparency and accessibility of funding instruments are also critical to ensure developers can move quickly and efficiently toward bankability.
Q: Should Africa prioritise country-level grids or regional expansion first?
A: This is not an either/or decision — both are necessary and complementary. Countrylevel grid strengthening is essential to:
- improve reliability;
- reduce technical losses; and
- enable domestic market stability.
However, regional interconnection unlocks much greater system optimisation. Different regions have different resource strengths — for example:
- Strong wind regimes in one area
- Hydropower baseload in another
- Solar dominance elsewhere
Cross-border grid connectivity allows:
- Resource diversification
- Improved energy security
- Larger trading markets
- Greater investment scale
Regional integration also strengthens economic cooperation and enables more competitive energy pricing. The ideal pathway is parallel development — strengthening national grids while progressively building regional interconnections to unlock continental-scale opportunity.
