Risk mitigation and transfer in renewable energy investments in East Africa

This report analyzes the role of risk mitigation and transfer instruments in utility-scale renewable energy investments across East Africa, utilizing six case studies from Burundi, Djibouti, Uganda, and Kenya to identify how these tools facilitate the transition from project development to financial close.

• Risk mitigation and transfer instruments are essential for moving renewable energy projects to financial close in East Africa, where investments face hurdles such as limited foreign currency access, rising public debt, financial strain on utilities, political uncertainty, grid constraints, and land-access challenges. These instruments include comprehensive programs like Scaling Solar and GET FiT, as well as project-level grants, concessional funding, technical assistance, and guarantees.
• Case studies demonstrate that risk mitigation strategies are tailored to national contexts: Burundi's first solar independent power producer relied on insurance and development finance institutions; Djibouti's Red Sea Power project used an all-equity model with political risk insurance; and the GET FiT Uganda Program utilized transparent tenders and institutional involvement to accelerate project deployment.
• Despite Kenya's position as a regional leader in private sector involvement in renewable energy, it remains susceptible to macroeconomic pressures, offtaker challenges, and transmission delays, which impact investor confidence. The report concludes that while financial guarantees and insurance are helpful, long-term reduction in the need for risk mitigation requires systemic improvements in utility performance and governance.

APA

Stockholm Environment Institute (2025). Risk mitigation and transfer in renewable energy investments in East Africa. https://www.sei.org/publications/risk-mitigation-transfer-renewable-energy-investments-east-africa/

Chicago

Stockholm Environment Institute. Risk mitigation and transfer in renewable energy investments in East Africa. 2025. https://www.sei.org/publications/risk-mitigation-transfer-renewable-energy-investments-east-africa/.

Wikipedia

{{cite report |author=Stockholm Environment Institute |title=Risk mitigation and transfer in renewable energy investments in East Africa |date=19 December 2025 |url=https://www.sei.org/publications/risk-mitigation-transfer-renewable-energy-investments-east-africa/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{stockholmenvironmentinstitute2025risk, author = {{Stockholm Environment Institute}}, title = {{Risk mitigation and transfer in renewable energy investments in East Africa}}, institution = {Stockholm Environment Institute}, year = {2025}, month = dec, url = {https://www.sei.org/publications/risk-mitigation-transfer-renewable-energy-investments-east-africa/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }