Renewable energy accounted for 59% of the 49 energy projects announced in Africa in 2024 by Chinese companies, according to a May 7 report by ODI Global. The shift reflects rising electricity demand on the continent and the growing availability of low-cost wind and solar technologies.

The report, titled China’s Evolving Role in Africa’s Energy Transition, highlights how China’s approach in Africa aligns with global trends. Chinese firms are gradually moving away from fossil fuels and increasing their overseas investment in renewables. Since 2021, the Chinese government has officially stopped financing new coal-fired power plants abroad.

Globally, both state-owned and private Chinese companies now prefer engineering, procurement, and construction (EPC) contracts over taking direct equity stakes in energy projects. This is even more evident in high-risk markets like Africa, where construction contracts represent 85% of Chinese energy activities, compared to only 15% involving acquisitions or equity participation.

In most cases, Chinese companies have also avoided working on projects led by independent power producers, which rely on long-term purchase agreements with public utilities or other buyers. Overall, Africa accounted for 20% of Chinese renewable energy investments and construction contracts in 2024.

Between 2010 and 2021, African countries received $65 billion in renewable energy financing from China. That amount made up roughly one-third of the global renewable energy loan portfolio that China extended to foreign governments or companies during that period. About 60% of the projects funded in Africa were valued below $100 million, while 15% required more than $500 million in investment.

The structure of China’s renewable lending is also changing. Loans are shifting away from the concessional terms offered by state policy banks and increasingly involve commercial lenders such as the Industrial and Commercial Bank of China and Bank of China. A growing share of funds now goes into joint ventures or special purpose vehicles.

Despite the changes in structure, most of the loans continue to target public institutions. Between 2010 and 2021, an estimated 92% of Chinese loans for renewable energy in Africa were issued to government agencies or state-owned enterprises. These loans mostly came from the Export-Import Bank of China and the China Development Bank.

Africa has also become an important destination for China’s solar and wind technology exports. Chinese engineering and construction companies working on renewable projects across the continent typically source their equipment from domestic firms, including Huawei and Trina Solar.

Between 2020 and 2024, Chinese exports of solar and wind technologies to Africa rose by 153% year-over-year. That growth is expected to continue, driven by increasing demand for electricity, the continent’s untapped renewable resources, and the competitive prices of Chinese panels and turbines.