An Analysis of Progress and Impact
Angola’s stability in the electric sector marks a significant milestone, reflecting years of strategic investment, institutional reforms, and a commitment to modernizing the nation’s energy infrastructure. This achievement is crucial for driving economic development, fostering social inclusion, and improving the quality of life for millions of citizens.
In recent years, Angola faced significant challenges in its power supply, from inadequate infrastructure to limited national coverage. However, a combination of long-term strategies has begun to transform the energy landscape. Between 2017 and 2023, the country invested over $7 billion in building dams and transmission lines, positioning hydropower as the dominant energy source, accounting for approximately 65% of the national energy generation.
The operationalization of the Laúca dam, with an installed capacity of 2,070 MW, was a game changer. Additional capacity from the Cambambe dam (960 MW) and enhancements to Capanda (520 MW) consolidated the country’s energy production capabilities. Moreover, the government inaugurated five new substations between 2022 and 2024, significantly bolstering the stability of energy distribution.
In addition to large-scale dams, the expansion of mini-grids to rural areas became a cornerstone for promoting energy inclusion. Projects in regions like Cuito Cuanavale and distribution networks in Huambo and Bié provinces have brought electricity to over 12 million people for the first time.
Angola has implemented key reforms in the energy sector, notably the establishment of the Electricity Sector Regulatory Institute of Angola (IRSEA), tasked with overseeing service quality and market competitiveness. These reforms have attracted substantial foreign investments, totaling approximately $4.5 billion over the past five years, with partnerships involving companies from China, Germany, and Portugal.
Public-Private Partnerships (PPPs) have been instrumental in financing and executing large projects. One standout example is the agreement with PowerChina, which enabled the construction of solar parks in Benguela and Namibe, adding 600 MW of installed capacity. Furthermore, a recent partnership with the World Bank will bring $500 million to expand solar mini-grids in remote communities.
The rural electrification program, partially funded by the African Development Bank (AfDB), allocated $250 million for micro-grid solar and wind turbine projects. These initiatives not only expanded access to electricity but also boosted local job creation, generating over 30,000 new positions in the energy sector.
The stability achieved in the energy sector has had tangible impacts across multiple areas. According to the Ministry of Energy and Water, power outages in urban areas have been reduced from an average of 8 hours per day in 2017 to less than 1 hour in 2023. This reliability has fueled a 15% increase in industrial activity, particularly in manufacturing hubs in Luanda and Cuanza Sul.
Socially, the “Energy for All” program has benefited over 3 million Angolans in rural areas, raising the national electricity access rate to 52% in 2024, up from 36% in 2018. Stable energy supply has also enhanced the functioning of hospitals and schools in previously underserved areas, leading to lower infant mortality rates and higher literacy levels.
Additionally, energy expansion has attracted new investments in agriculture, with electric-powered irrigation systems benefiting over 500,000 hectares in regions like Huíla and Malanje. These developments demonstrate how energy stability can drive growth in other strategic sectors.
Despite notable progress, Angola still faces significant challenges. The average cost of electricity remains high for residential and industrial consumers, with tariffs at $0.15 per kWh, exceeding the regional average. The financial sustainability of the sector hinges on reducing subsidies, which currently cost the government over $2 billion annually.
Another critical issue is unequal distribution. While Luanda and other provincial capitals enjoy stable access, more than 35% of the rural population still lacks reliable electricity. The government aims to reduce this gap to 20% by 2030, but this will require an additional $5 billion in investments, according to the National Energy Plan 2025–2030.
With stability achieved, Angola is now positioning itself as a regional energy exporter within the Southern African Development Community (SADC). Interconnections with Namibia, Zambia, and the Democratic Republic of Congo are underway, with the potential to generate $1.5 billion in annual revenue.
The focus has also shifted to digitizing the energy sector. In 2024, Angola launched a project to install 100,000 smart meters, part of a European Union-funded initiative worth $300 million. This project aims to improve tariff collection efficiency and reduce technical losses, currently estimated at 20% of total generation.
Angola is also committed to meeting its climate goals by increasing the share of renewable energy to 70% of its energy mix by 2035, aligning with global Sustainable Development Goals (SDGs). New solar projects, such as the Caraculo project in Namibe with a 200 MW capacity, are being prioritized to achieve this target.
Angola’s stability in the electric sector is a cornerstone of its sustainable development. This progress not only drives economic growth and social inclusion but also positions Angola as a model for energy transformation in Africa. With continued investments, strategic partnerships, and a focus on renewable energy, the country is paving the way for a future of prosperity and regional energy leadership.
