Local currency financing has emerged as one of the most pressing obstacles to scaling Africa’s energy ambitions, according to discussions at the African Investment Forum (AIF) in Rabat, Morocco last week.

Ministers and development financiers meeting at the AIF—organised by the African Development Bank (AfDB)—warned that foreign-currency debt, compounded by local currency shortages, expose utilities, projects, and consumers to severe financial risks.

With an annual energy investment gap estimated between $31 billion and $50 billion, unlocking large-scale energy projects will depend on the ability to de-risk capital and create an environment where long-term private investment can thrive.

The issue dominated a high-level pre-AIF panel discussion on Country Leadership and Private Sector Participation. Speakers repeatedly stressed that without viable local-currency instruments, Mission 300 and broader energy-access targets will stall.

Twenty-nine African countries have already developed National Energy Compacts with time-bound targets to expand access, strengthen utilities, and attract private capital.“We cannot keep financing African power projects in hard currency when revenues are in unstable local currencies—it is simply unsustainable,” said Wale Shonibare, AfDB Director for Energy Financial Solutions, Policy, and Regulation.“If consumers pay in local currency, then our financing must be in local currency or hedged accordingly. Relying on unhedged foreign-currency loans destabilises tariffs, scares investors, and puts governments under unbearable pressure.”Demba Tandia, TCX Fund Regional Vice President for Sub-Saharan Africa, described local-currency risk as “the darkness that still remains.”Hydropower projects are among the most affected, as their long execution timelines leave initiatives such as the proposed Grand Inga Dam in the Democratic Republic of Congo in limbo.

Tandia warned that once foreign currency enters a model where revenues are in local currency, “the risk is still around… it’s just shifting from one market to another.” He revealed that TCX and its shareholders—including the International Finance Corporation and the European Commission—are developing hedging and blended-finance tools to make local-currency borrowing viable. These include a planned $1 billion facility, with 55 percent earmarked for Africa, designed to provide “double-digit-rate and quadruple-rate protection” against currency volatility.

During Mission 300 Day, ministers from Comoros, Guinea, Gambia, and Lesotho presented implementation roadmaps with specific deadlines for achieving universal electricity access by 2030. They engaged directly with private-sector leaders and development partners on regulatory reforms needed to unlock investment.“The mismatch between foreign-currency debt and local-currency revenues is crippling utilities across the continent. This is the biggest challenge for most countries in Africa,” said Nani Juwara, Gambia’s Minister of Petroleum and Energy.

He emphasized that investors can repatriate their earnings without restriction, supported by incentives such as tax holidays, import-duty exemptions for energy equipment, and VAT waivers for renewable investments.

Despite currency headwinds, Juwara positioned Gambia as a ready investment destination, highlighting stability, legal protections, and aggressive electrification targets.“The Gambia is an investment haven,” he declared, adding that “our constitution guarantees all investors against any attempt at nationalisation or appropriation.”Panelists agreed that Africa must deepen domestic capital markets, integrate decentralised and centralised systems through clear regulation, and expand hedging tools to prevent currency instability from derailing progress.“Energy access is a powerful driver of development. Through Mission 300, we’re advancing an investor-ready energy transition for Africa,” said Damilola Ogunbiyi, CEO and Special Representative of the UN Secretary-General for Sustainable Energy for All..

William Asiko, Senior Vice President of the Rockefeller Foundation, added:“Governments are leading; partners are strategically aligning; and a credible pipeline is emerging that can bring clean, reliable power to hundreds of millions of Africans. Philanthropy helps spark progress, but it is the collective strength of partnerships that will deliver the final results.”Kevin Kariuki, AfDB Vice President for Power, Energy, Climate & Green Growth, emphasized that Mission 300 will be underpinned by massive and rapid investments in generation, transmission, distribution, and last-mile connectivity infrastructure.“At the African Development Bank, we are committed to de-risking investments, mobilising institutional capital, and ensuring that Mission 300 delivers not just electricity, but millions of jobs, vibrant industries, and dignified livelihoods for our people,” he said.

Without sustainable local-currency solutions, experts warned, Africa risks building energy systems that investors cannot support and consumers cannot afford.

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