IMAGE: bird story agency
Projects worth more than US$20 billion are emerging across Africa, alongside climate-finance initiatives and cross-border infrastructure plans. But financing, export demand and fragmented infrastructure will determine whether these ambitions translate into a competitive regional industry.
By Bonface Orucho, bird story agency
African countries are beginning to coordinate financing and infrastructure for green hydrogen as they seek to turn individual national projects into a competitive export industry.
New investment platforms in Southern Africa and a proposed hydrogen corridor linking North Africa to Europe are providing early examples of how countries could share the costs and opportunities of developing the emerging energy market.
In September, the African Development Bank (AfDB) identified four green hydrogen and derivatives projects in Egypt, Morocco, Namibia and South Africa representing an estimated US$23 billion in prospective investment.
The bank announced more than US$20 million in reimbursable grants to help prepare the projects for investment.
Together, they envisage 20 GW of solar and wind generation capacity, 7 GW of electrolyser capacity and 2,950 MWh of battery storage, according to the AfDB.
The selected projects include Egypt’s Project Ra, Morocco’s Guelmim Green Hydrogen Valley, Namibia’s Hyphen development and the Saldanha Hydrogen Direct Reduced Iron project in South Africa.
The proposed grants range from US$3.55 million for Egypt’s project to US$5.93 million for Namibia’s Hyphen, with the funding intended to improve project bankability rather than finance construction.
The bank said its programme attracted 81 applications from 18 African countries, indicating the breadth of interest in developing hydrogen-related industries across the continent.
A further financing development emerged in October, when the Green Climate Fund approved US$140 million for Climate Investor Three, a blended-finance platform supporting industrial decarbonisation, including green hydrogen infrastructure in Namibia and South Africa.
The facility, overseen by the Development Bank of Southern Africa, will allocate US$84 million to South Africa’s SA-H2 Fund and US$56 million to Namibia’s SDG Namibia One Fund, according to fund manager Climate Fund Managers.
The financing is intended to reduce project risks and attract additional private investment towards a US$1.2 billion fundraising target.
Its portfolio covers renewable energy generation, hydrogen production, transport and downstream industries, including green ammonia and methanol. Climate Fund Managers said the programme would support integrated industrial value chains rather than focus exclusively on hydrogen production.
The two national funds are also attracting capital independently. South Africa’s SA-H2 Fund reached an initial close of R3 billion (approximately US$182 million) in August, with investments from the Public Investment Corporation, Sanlam Life, the Industrial Development Corporation and the Development Bank of Southern Africa.
In Namibia, SDG Namibia One had secured approximately N$2.15 billion (US$129 million) in combined commitments and approvals by November 4, equivalent to about 37% of its US$350 million fundraising target, according to Namibia’s The Brief.
The fund said the amounts included US$56 million approved by the Green Climate Fund, alongside commitments from Invest International and the European Union. However, the commitments and approvals had not all been disbursed.
The financing developments are particularly relevant to Namibia’s Hyphen project, a proposed development estimated to cost more than US$10 billion.
The project envisages 3 GW of electrolyser capacity and 8 GW of renewable energy generation across two phases, with the potential to produce up to two million tonnes of green ammonia annually.
Its developer is targeting a final investment decision by the end of 2027, illustrating both the scale of the opportunity and the amount of capital still needed to move the project into construction.
Cooperation is also taking shape around the infrastructure needed to transport hydrogen between countries. In North Africa, Algeria and Tunisia have joined Italy, Austria and Germany in advancing the SoutH2 Corridor, a proposed 3,300-kilometre pipeline network connecting renewable hydrogen production in North Africa with European industrial markets.
The five countries reinforced their political commitment through a ministerial declaration signed in Algiers on October 1, following the launch of a United Nations Industrial Development Organization-hosted secretariat in Rome in September.
The corridor’s developers envisage using more than 65% repurposed gas pipelines and transporting approximately four million tonnes of renewable hydrogen annually when fully operational in the early 2030s.
The infrastructure is being developed by European transmission operators Snam, TAG, Gas Connect Austria and bayernets. According to UNIDO, the secretariat will provide a platform for participating countries to coordinate technical priorities, address cross-border challenges and connect producers with industrial buyers.
However, the proposed capacity and timeline remain dependent on financing, production commitments and firm commercial agreements.
Further south, Namibia and South Africa are exploring shared hydrogen infrastructure connecting production and export hubs at Lüderitz, Boegoebaai and Saldanha Bay.
A February 2026 study commissioned by Germany’s environment ministry and involving South Africa’s Council for Scientific and Industrial Research examined how pipelines, railways and other transport options could connect hydrogen production centres with industrial users and export facilities.
The study identified rail transport for green ammonia as a potentially viable option in both countries, provided sufficient demand exists. It also highlighted the importance of coordinating infrastructure development in the Northern Cape.
The two governments have identified the proposed Boegoebaai port and green hydrogen development as opportunities for a cross-border industrial corridor. However, the pipeline remains at the planning and feasibility stage, with financing, ownership and regulatory arrangements still to be resolved.
The emerging cooperation comes as Africa’s hydrogen industry faces a substantial gap between announced ambitions and actual production.
The International Energy Agency’s Global Hydrogen Review 2026 estimates that the continent currently produces just 6,000 tonnes of low-emissions hydrogen annually. Its pipeline of 31 projects could raise production to 1.2 million tonnes by 2030, but only one had reached a final investment decision in the agency’s assessment.
The agency also identifies a domestic industrial opportunity that could strengthen the economics of regional cooperation. Africa’s fertiliser consumption is about one-sixth of the global average, and achieving the continent’s fertiliser-use targets could create demand for approximately 1.5 million tonnes of hydrogen.
Yet more than 80% of announced African ammonia production capacity is intended for export, according to the IEA, highlighting the need to balance overseas markets with domestic industrial demand.
South Africa’s Electricity and Energy Minister Kgosientsho Ramokgopa has called for African countries to coordinate infrastructure corridors, certification, standards and project preparation.
Speaking at the Africa Green Hydrogen Summit in September, he cautioned that “a memorandum of understanding is not a bankable customer agreement”, emphasising the importance of securing long-term buyers and financing before projects advance to construction.
While Africa produces just 6 kilotonnes of low-emissions hydrogen today, the continent holds unmatched potential to produce up to 50 million tonnes annually by 2035, according to the IEA and European Investment Bank.
bird story agency
Leave a Reply