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Assessing Private Investment in African Renewable Energy Infrastructure: A Multi-criteria Decision Analysis Approach


  • Baumli, Kenny

    (Department of Economics, Copenhagen Business School)

  • Jamasb, Tooraj

    (Department of Economics, Copenhagen Business School)


Energy poverty remains prevalent in many African countries, hindering economic development and exacerbating social inequalities. Simultaneously, population growth throughout the continent is expected to perpetuate the already high demand for basic energy services into the coming decades. Private sector finance is increasingly regarded as a necessary ingredient to remedy Africa’s energy challenges and to stimulate the adoption of renewable energy. However, investments remain insufficient for the burgeoning infrastructure requirements of the African economies. This paper seeks to delineate the financial and non-financial drivers of investment decisions to understand better the barriers to private participation in African renewable energy projects. Using a Fuzzy Technique for Order Preference by Similarity to Ideal Solution (TOPSIS) approach, we evaluate the attitudes and beliefs about country-level characteristics for investment decisions. Analysis of primary data from energy professionals highlights that perceptions moderate choices through evaluation criteria, which in turn predicate policy recommendations. Investor confidence in regulatory effectiveness is identified as the primary concern for investors. Local capacity building and policy instruments, designed to overcome institutional rigidities, are among the preferred solutions. The findings indicate that non-financial drivers contribute significantly to understanding Africa’s private energy investment challenges and provide a key to disentangling the determinants of these investments.

Suggested Citation

  • Baumli, Kenny & Jamasb, Tooraj, 2020. "Assessing Private Investment in African Renewable Energy Infrastructure: A Multi-criteria Decision Analysis Approach," Working Papers 15-2020, Copenhagen Business School, Department of Economics.
  • Handle: RePEc:hhs:cbsnow:2020_015

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    2. Andile Dube & Sylvester Senyo Horvey, 2023. "Institutional quality and renewable energy capital flows in Africa," Future Business Journal, Springer, vol. 9(1), pages 1-16, December.
    3. Teresa Cuerdo-Vilches & Miguel Ángel Navas-Martín & Ignacio Oteiza, 2021. "Behavior Patterns, Energy Consumption and Comfort during COVID-19 Lockdown Related to Home Features, Socioeconomic Factors and Energy Poverty in Madrid," Sustainability, MDPI, vol. 13(11), pages 1-19, May.
    4. Ahlem Jellali & Wafik Hachicha & Awad M. Aljuaid, 2021. "Sustainable Configuration of the Tunisian Olive Oil Supply Chain Using a Fuzzy TOPSIS-Based Approach," Sustainability, MDPI, vol. 13(2), pages 1-19, January.
    5. Henrique Oliveira & Víctor Moutinho, 2021. "Renewable Energy, Economic Growth and Economic Development Nexus: A Bibliometric Analysis," Energies, MDPI, vol. 14(15), pages 1-28, July.
    6. Kamali Saraji, Mahyar & Aliasgari, Elahe & Streimikiene, Dalia, 2023. "Assessment of the challenges to renewable energy technologies adoption in rural areas: A Fermatean CRITIC-VIKOR approach," Technological Forecasting and Social Change, Elsevier, vol. 189(C).
    7. Silvana Secinaro & Davide Calandra & Denisa Petricean & Federico Chmet, 2020. "Social Finance and Banking Research as a Driver for Sustainable Development: A Bibliometric Analysis," Sustainability, MDPI, vol. 13(1), pages 1-19, December.

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    More about this item


    Renewable energy; Investment; Multi-Criteria Decision-Making; Africa;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

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