The African Continental Free Trade Area (AfCFTA), through creating the world’s largest free trade area by number of countries, is unlocking new opportunities for the continent’s renewable energy and natural gas industries.

AfCFTA is set to play a transformative role in the development of Africa’s energy sector, providing the framework needed to enhance intra-African trade, attract investment and boost regional energy integration.

This topic will feature during the upcoming 2025 Africa Energy Indaba at the Cape Town International Convention Centre on March 4-6 where industry leaders, policymakers and investors will gather to explore how the AfCFTA can accelerate energy sector growth across the continent.

One of the key benefits of the AfCFTA is the removal of trade barriers, including tariffs and customs delays. By fostering cross-border energy trade, it enables the free flow of renewable energy and natural gas across Africa, creating integrated energy markets that can help reduce energy costs, increase efficiency and promote access to electricity in underserved regions.

The AfCFTA provides a platform for power-sharing agreements, which will enable energy-rich countries to supply power to energy-deficient nations. Countries such as South Africa, Egypt and Nigeria are positioned to export solar, wind and gas energy to neighbouring countries.

It will also be influential in expanding the natural gas sector, which holds significant potential for the continent’s economic growth. Major gas producers such as Mozambique, Nigeria and Tanzania stand to benefit from more efficient and expanded regional trade. By improving the ease of exporting liquefied natural gas, AfCFTA helps these countries tap into growing demand for cleaner energy sources within Africa.

AfCFTA’s emphasis on sustainability and environmental regulations encourages African nations to develop clean energy projects that reduce reliance on fossil fuels. By providing the regulatory framework for green energy trade, it encourages countries to cooperate in the development of low-carbon technologies such as green hydrogen and electric vehicle manufacturing, enabling African nations to attract green financing and innovation into the region.

AfCFTA will be key in promoting large-scale infrastructure projects and benefit the regional energy grids being developed in Southern, Eastern and Western Africa – designed to facilitate cross-border electricity trade. The continent’s energy infrastructure can expand rapidly, including the development of transmission lines, substations and pipelines, which are all necessary to build an interconnected energy market.