Across Southern Africa, the demand for energy finance is not theoretical — it is immediate and structural. Industrial expansion, mining growth, urbanisation and the imperative of energy security are driving an expanding pipeline of renewable energy projects.
Yet private capital is often described as hesitant. That diagnosis is misplaced.
From the perspective of institutional investors, the constraint is rarely appetite. It is structure.
Capital exists, but it must be aggregated
Renewable energy infrastructure requires long-duration funding. Pension funds, insurance balance sheets and sovereign pools are the natural providers of such patient capital. However, in many of our markets, domestic savings ecosystems remain shallow. Long-term capital is fragmented and insufficiently aggregated to underwrite large-scale infrastructure consistently.
The result is a supply-demand imbalance: the need for finance exceeds the locally available pool of patient capital. What appears as investor reluctance is often simply a reflection of scale constraints and underdeveloped capital markets.
A clear illustration is the green bond issued by the Zambia Copperbelt Energy Corporation. The transaction targeted approximately US$150 million and ultimately raised closer to US$200 million, reflecting strong investor demand.
The structure mattered. Issuing in green bond format broadened the eligible investor universe.
Government policy assurances and tax incentives enhanced bankability. Most importantly, the offtake agreements were anchored by mining companies — commercial entities with predictable demand and credible balance sheets.
Investors were underwriting visible, contractually secured cash flows.
Notably, much of the capital originated from markets with deeper pension aggregation and more advanced capital market intermediation. The question this raises is strategic: why are deeper pools of long-term capital still coming from further afield?
If Southern Africa is serious about infrastructure independence, strengthening domestic savings systems and bond markets is not optional. It is foundational.
No substitute for commercial structure
Renewable energy projects in the region carry undeniable developmental impact. They enhance resilience, reduce carbon intensity and address chronic power deficits. Public demand is clear.
But institutional capital is fiduciary capital. It allocates funds according to risk-adjusted return frameworks. Investors require clarity on revenue certainty, policy stability, counterparty creditworthiness and currency exposure.
Where those variables are opaque, capital either prices risk prohibitively or withdraws.
The lesson from successful transactions is straightforward: when projects are properly de-risked and commercially structured, capital flows. When risk allocation is ambiguous or policy frameworks are inconsistent, it does not.
De-risking is not concessionary policy. It is disciplined risk allocation — ensuring that construction risk, regulatory risk, market risk and currency risk sit with the parties best positioned to manage them.
The policy tension we must address
There is a structural tension at the heart of energy reform.
Governments rightly prioritise universal access and affordability. But private capital requires commercial viability. When these objectives are pursued simultaneously without clear sequencing or structural clarity, scalable investment suffers.
Energy supply must expand before it can be redistributed optimally.
Where industrial customers are prepared to pay commercial tariffs — and private capital is prepared to finance generation against those tariffs — regulatory frameworks should facilitate that transaction efficiently. Bureaucratic friction between willing capital providers and willing offtakers suppresses capacity growth.
Expanding commercially viable supply creates fiscal and structural space to pursue targeted subsidies, cross-subsidisation models and broader access objectives. Attempting to compress all objectives into every project weakens investability.
A regional imperative
If we are to close Southern Africa’s energy deficit meaningfully, capital markets must be treated as strategic infrastructure. Deepening pension systems, strengthening domestic bond frameworks and standardising renewable project documentation are not peripheral reforms. They are central to unlocking scale.
Private capital is not opposed to renewable energy. Properly structured renewable assets offer stable, long-duration cash flows well suited to institutional portfolios.
But capital flows toward clarity.
The real question is not whether the money exists. It does. The question is whether our projects — and our policy environments — are structured with sufficient commercial discipline to meet that capital halfway.
When they are, private capital does not hesitate.
It scales.
l Sam Matsekete is the group chief executive officer for Old Mutual Zimbabwe. He was speaking to Alpha Media Holdings reporter Donald Nyandoro at the just-ended Sadc Sustainable Energy Week in Victoria Falls.