Will Africa's Solar Demand Fill US Gap For China?

The global solar energy landscape is undergoing a tectonic shift, driven by geopolitical manoeuvres in the West and urgent development needs in the Global South. The United States has progressively shut China-origin solar panels out of its market starting in 2018, reducing their share to less than 3 percent by 2024. This strategic decoupling has left massive manufacturing capacity in China looking for new homes.

Simultaneously, Africa stands at a crossroads. With high potential for solar power generation, more than any other continent, yet accounting for less than 2 percent of global installed capacity, the continent is ripe for transformation. 

In a key development, African nations imported 15 GW of Chinese solar capacity in just 12 months in 2024. This figure suggests that Africa is not just an emerging market but is poised to fill the gap left by the US in the mediaum to long term. This blog explores the convergence of China’s export pivot, Africa’s power deficit, and the rising role of off-grid solutions and new market entrants.

The Great Decoupling: How the US Shut the Door

The reshaping of global solar trade flows began in earnest around 2018. Under the "Make America Great Again" (MAGA) policy initiatives, the United States moved to protect domestic interests by imposing tighter trade measures on Chinese imports. 

Historically, the US absorbed the majority of solar shipments from China until then, but this dynamic has been dismantled. According to the Solar Energy Industries Association (SEIA), the US administration has mandated strict Foreign Entity of Concern (FEOC) requirements. These rules dictate that a certain share of a project’s costs cannot be paid to "specified foreign entities" or "foreign-influenced entities." For the US solar industry, companies headquartered in China or those with ties to China are the primary targets.

The restrictions are aggressive and progressive, specifically regarding the Material Assistance Cost Ratio (MACR). This rule mandates that the share of a project's costs that cannot be paid to Chinese-linked entities starts at 40 percent in 2026. 

This ratio is set to increase by five percentage points annually, reaching 60 percent in 2030 and beyond. While US solar projects rarely source finished panels directly from China today, the supply chain remains entangled, as many parts are fed by China-headquartered companies or utilise technologies with patents held by Chinese firms. 

Determining which ownership structures are FEOC-compliant involves substantial legal complexity, and the industry is still awaiting precise timing on guidance from the Treasury Department. 

Consequently, the US remains a leading PV market but lags in saturation; the National Renewable Energy Laboratory (NREL) notes that PV generation represents only 8 percent of total country electricity generation in the US, below the global average of other leading markets.

The Chinese Pivot: A Surge into Africa

With the US market effectively closed, holding Chinese import share to under 3 percent, and trade wars intensifying, Chinese manufacturers faced critical overcapacity issues. China accounts for over 80 percent of global solar panel manufacturing, according to the International Energy Agency (IEA). In fact, the Chinese industry faces the paradox of global domination and operational losses. 

To sustain production levels, manufacturers have had to deepen engagement with Europe, the Middle East, and specifically, Africa. Data from 2024 and 2025 highlights a massive redirection of solar exports. An analysis of Chinese export data by the British renewable energy think tank Ember indicates that in just 12 months, China shipped solar panels with a capacity of 15 GW to Africa. 

To put this in perspective, this single-year influx compares to a total of 75 GW shipped in the entire first 25 years of this century. Furthermore, ODI Global noted that Chinese solar and wind technology exports to Africa surged 153 percent from 2020 to 2024.

Major Chinese players are explicit about this strategy. In their 2025 H1 investor presentations, companies like Longi reported that while exports to traditional markets like Europe slowed, emerging markets like Africa maintained steady growth. 

Similarly, Jinko Solar confirmed that it is aggressively expanding into the African market. China has also backed this commercial push with diplomatic and financing initiatives, launching a three-year plan in 2024 with pledges on solar rollout, project development, and funds to localise supply chains. The best part? Most African countries are a few years away from insisting on domestic manufacturing, as China has faced in India, the US, Europe and now, even in South America to an extent. 

Africa’s Energy Reality: The Demand Vacuum

The influx of solar panels is not merely a result of Chinese push factors; it is being pulled by a desperate need for power within Africa. The continent faces the world’s most severe energy deficit. 

As of 2025, approximately 600 million Africans lack access to electricity, according to Empower Africa. This represents 43 percent of the continent’s population and accounts for more than 80 percent of the global population without electricity. Made worse by lack of reliable national grids across many countries.

The inequality is stark, as four in five people without power live in rural areas. While cities are gradually improving, fewer than one in five rural residents has reliable power. Between 2010 and 2020, Africa achieved fast electrification growth; however, since 2020, population growth has outpaced progress. For every 100 people gaining electricity, nearly 80 are added to the population, erasing gains.

Three countries account for nearly 40 percent of the total deficit, highlighting the concentration of the crisis. Nigeria, despite being a major oil producer and the largest economy, has approximately 86 million people lacking power. The Democratic Republic of Congo (DRC), despite vast hydropower potential on the Congo River, sees rural access below 20 percent, leaving about 79 million people in the dark. Similarly, Ethiopia, even with large hydropower dams, still has around 56 million people remaining without power.

The Case for Solar Plus Battery: Solving the Grid Problem

For the 600 million people without access, extending the main grid is often logistically difficult and prohibitively costly. Furthermore, for those already connected, reliability is a massive obstacle. 

Dependence on traditional grids has proven risky due to climate vulnerabilities and infrastructure fragility. For instance, Zambia and Zimbabwe experienced crippling power cuts after drought conditions depleted the Kariba Dam. 

Although water allocations improved slightly for 2025, the crisis highlighted the dangers of hydro-dependency. Additionally, Nigeria’s grid remains fragile with periodic nationwide collapses, and while South Africa has reduced blackouts compared to 2022–23, load-shedding persisted into early 2025.

This lack of reliability makes the case for solar plus battery storage compelling. Global technology cost reductions have made solar PV the least-cost source of power in many African countries. 

Husk Power Systems and similar entities view off-grid solar and mini-grids as the primary solution for the rural deficit. Comparisons show that while solar-plus-storage prices need to fall further to be universally adopted in markets like India, and Africa, where the alternative is expensive diesel or petrol generators, the economics are favourable. Consequently, there is a rising demand for storage in relatively richer markets like South Africa, specifically to counter grid reliability issues.

Private Growth Amidst Public Decline

Filling the solar gap requires capital, and Africa’s renewable energy investment ecosystem is witnessing a divergence between public and private funding. Achieving climate and energy goals requires over USD 200 billion annually this decade, yet actual clean-energy investment reached only around USD 40 billion in 2024. 

A significant burden is public debt servicing costs in Emerging Market and Developing Economies (EMDE), which are equivalent to over 85 percent of total energy investment in 2025. Half of this debt is owed by just four countries: Egypt, Angola, South Africa, and Morocco.

While public funding faces headwinds, the private sector is showing resilience. Public and Development Finance Institution (DFI) funding for energy projects fell by one-third over the past decade, from USD 28 billion in 2015 to USD 20 billion in 2024. 

Notably, Chinese DFI spending declined by over 85 percent between 2015 and 2021. However, private clean energy investment has more than doubled over the last five years, rising from USD 17 billion in 2019 to almost USD 40 billion in 2024. While high borrowing costs and underdeveloped capital markets remain barriers, the private sector is stepping up where DFIs are pulling back.

Beyond China: Indian Companies Enter the Fray

While China dominates the hardware supply, Indian companies are increasingly capitalising on Africa's solar demand, particularly in Engineering, Procurement, and Construction (EPC) and specialised pumping solutions.

Sterling and Wilson (SWREL), an Indian heavyweight, is expanding deeply into South Africa. The company confirmed securing a Letter of Intent (LOI) for a 115-MW turnkey project valued at roughly USD 120 million, which will be their third project in the country with more large-scale discussions underway. 

Similarly, Shakti Pump is focusing on the agricultural and water sectors, expanding its presence in Uganda and across the continent. Their exports reached INR 1,029 Mn in Q2FY26, driven by demand from Africa, the USA, and the Middle East.

Other players are also making strategic moves. Vikram Solar opened its third African office in Johannesburg to increase proximity to customers, complementing branches in Kenya and Uganda. They estimate South Africa's installed capacity will rise to 8.5 GW by 2030, requiring investments exceeding USD 20 billion. Additionally, Candisolar, managing operations from Switzerland, is supporting South African markets, aiming to reach significant GW targets in the coming years.

Leveraging Minerals for Energy

Finally, Africa’s potential to fill the solar gap is tied to its geological wealth. The continent holds a "mineral bank" essential for the global energy transition, being the dominant source of cobalt (two-thirds of global output) and accounting for 20 percent of global copper supply, alongside significant reserves of lithium and manganese. 

Currently, most of these minerals are exported to China for processing before being used in renewable tech. A Wood Mackenzie report notes that this dynamic presents a strategic opportunity: given the scale of risk-tolerant Chinese investment, African nations can strike deals to leverage access to these critical minerals in return for direct investment in clean energy projects and infrastructure at home, rather than just exporting raw resources.

The data is clear: The US has shut the door on Chinese solar, and China has pivoted aggressively to Africa. While Africa faces a daunting USD 200 billion annual investment requirement and a massive deficit affecting 600 million people, the convergence of Chinese overcapacity, African demand, and rising private sector interest suggests that Africa is indeed filling the gap. With solar-plus-storage becoming the pragmatic solution for a continent plagued by grid instability, Africa is transforming from a passive recipient of aid to a central player in the global solar market.