Solving Africa’s energy challenges is often framed as a matter of generating more power, whether it be from solar panels, wind farms, hydroelectric dams, gas turbines or coal-burning power stations. But another element is vital: transmission. Without a solid transmission backbone, it is impossible to move power from where it is generated to where it is consumed.
Indeed, in Africa and around the world, major electricity generation projects are often delayed by the lack of a grid connection. The bulk of Africa’s 600m people who live without an electricity connection are found in rural areas, which transmission lines have so far failed to reach.
As African governments have looked for ways to increase power generation, the traditional model of publicly owned utilities holding a monopoly over the energy sector has broken down. Throughout the continent, it is now fairly common for independent power producers to build and operate electricity generation assets that provide power to the grid.
Transmission and distribution, however, has remained almost entirely the domain of state-owned utilities, until now.
In Uganda, Gridworks, a company owned by British International Investment, is about to start construction on the $50m Amari transmission project, the first such independent transmission project in Africa to enter the construction phase. The project will upgrade four key substations, helping to integrate more renewables onto the grid and to supply power to industrial users.
“It’s going to be interesting, because it’ll be the first one on the continent to go into construction,” says Chris Flavin, CEO of Gridworks. “Uganda is a bit of a trailblazer on that front.”
Going private
Uganda might be a trailblazer, but multiple African countries are preparing to bring private sector capital into their transmission networks. Gridworks is working with several other African governments – including that of Mozambique, on a project to improve the flow of power between the north and south of the country. In February the company signed a deal with Ethiopia to develop two new transmission lines in the country, including a project that will enhance connectivity in the Somali Region.
“These projects represent the first public-private partnerships in our transmission network and mark an important step in attracting more investment to the sector,” Abebe Gebrehiwot Yihdego, head of the public private partnership (PPP) unit at the Ethiopian Ministry of Finance, said in a statement.
Meanwhile in Kenya the electricity utility KETRACO signed a PPP deal in December with infrastructure investment platform Africa50 and the Power Grid Corporation of India, for a $311m investment in two high voltage transmission lines. “For us, it’s very important,” says Demba Diallo, managing director at Africa50. “You cannot have renewables developed without the proper transmission line.
“And there is a lack of lack of investment there, because until now it is funded by public money,” he adds. “So, we have to bring in private capital.”
Flavin points out that governments would traditionally finance transmission projects by “using forms of funding that add to national debt”. Yet with most African state-owned energy utilities in varying degrees of financial distress, at the same time as governments are pushing to extend electricity access in line with the Mission 300 objective to connect 300m people by 2030, there is a need to look for new financing models.
“Using the private sector is a way to access a larger pool of capital, and a pool of capital that has fiscal advantages,” says Flavin. “Developing large infrastructure projects requires expertise and resource as well.”
It is often said that governments tend to be hesitant about allowing private sector partners to operate electricity transmission, out of fear of losing control over what they deem to be strategic national assets. Flavin, however, says the idea that governments have a “philosophical” antipathy towards private investment in transmission is misplaced. “I haven’t ever really encountered that when I’ve gone and discussed with the government,” he says.
Getting the private sector in
Governments have several options as they look to solicit private sector investment in transmission. Ryan Ketchum, partner at law firm Hunton, highlights four main models for private transmission investment.
One possibility is to grant a concession to operate the entire transmission network. Ketchum says this approach has been “very successful” in the Philippines, but has not yet been attempted in Africa.
Another option is to fully privatise the transmission network, by selling shares in a corporate vehicle that is set up to operate the system. This is “very challenging from a political perspective,” Ketchum says, noting the “less than optimum experiences” that some African countries have had with privatisations in other sectors.
A third possibility is to invite private investment in building merchant lines. These typically seek to connect two power markets, then profit from arbitrage – for example, by selling surplus power from one market to another market at times when prices are higher there. These projects have had mixed success globally, Ketchum opines, and tend to attract capital that is looking for much higher returns than typical infrastructure investors.
This leaves a fourth option – independent transmission projects (ITPs). These typically involve a contract being awarded to a private sector company to build a new transmission line and then operate that line over a long period. The private company will receive payments over this period as it recoups its investment and delivers a return. This model has been used extensively in Latin America; and the likes of Uganda, Kenya and several other African countries are now keen to adopt the ITP model in their electricity networks.
Perhaps most significantly, South Africa has launched an Independent Transmission Projects Procurement Programme (ITPPP), modelled on its largely successful independent power producer (IPP) scheme that has brought a significant amount of wind and solar capacity into operation.
The aim of the ITPPP is to mobilise the private sector to help deliver the 14,000 km of new transmission lines that the country needs to build over the next decade. In December 2025 seven consortia featuring major international companies – including India’s Adani Power, France’s EDF and China’s Southern Power Grid International – were selected as “pre-qualified bidders”. These consortia will now submit detailed proposals ahead of final decisions on project selection.
The growing popularity of ITPs reflects their relative simplicity. “It’s the easiest one to do on both sides,” says Ketchum. “It’s easy for a country to structure a transmission line or a package of transmission lines and conduct a tender for an ITP over those transmission lines. It’s much more difficult to restructure an entire sector.”
Commencing transmission
Flavin echoes these sentiments, noting that ITPs do not affect the role of the transmission system operator in actually dispatching power. “With ITPs, you can take projects that are part of the grid development plan, that the government knows it needs, and you sit down and say, ‘let’s solve this problem that you’re working on already’ with them,” he says. “The other ways to make private capital available require a much bigger intervention in the country.”
“An ITP transaction might take two or three years in development, two or three years in construction, and then you’ve commissioned an operating asset. It’s just a no-brainer, and it requires way less regulatory reform and legal reform and structural reorganisations of utilities.”
Now that construction work is about to commence on the Amari project, Africa is moving into a new phase with private transmission. Over the next few years, it is highly likely that many more projects will move off the drawing board, and into construction and operation.