By Reda Helal
As Brent crude prices surged above $100 per barrel in March and diesel costs spiraled, African economies reliant on diesel-fired power are facing both supply disruptions and rising energy costs. Small to medium-sized enterprises (SMEs), already operating on tight margins, are particularly affected.
In this context, coal-fired power generation is emerging as a viable domestic solution. With reserves estimated in the hundreds of billions of tons, African coal can provide fiscal relief for SMEs, stabilize electricity costs, preserve foreign exchange, and support business continuity during geopolitical uncertainties.
Escalating Fuel Prices Challenge SMEs
Diesel-dependent businesses across Africa, including in South Africa, Nigeria, Zimbabwe, Botswana, and Uganda, are struggling with soaring fuel costs. Nigeria’s diesel prices reached ₦1,000 per liter, representing a 39.5% increase since February, while Zimbabwe’s diesel averages $2.18 per liter, with petrol exceeding $2 per liter, the highest among SADC nations. Uganda and Botswana also face significant price volatility.
Coal as a Strategic Lifeline
Countries with significant coal reserves—Nigeria (9.8 bcm), Zimbabwe (502 mcm), Botswana (1.6 bcm), and Uganda (800 mcm)—can leverage coal-fired power to reduce dependence on imported fuels, lower electricity costs, and support industrial growth. Affordable and reliable electricity can determine whether SMEs expand or stagnate, enabling long-term planning and economic resilience.
“When African businesses are being crushed by imported fuel costs, using domestic coal to keep factories running and SMEs alive is not a step backward—it is a rational act of economic self-defense,” says NJ Ayuk, Executive Chairman, African Energy Chamber.
AEW 2026 Brings Coal Back Into the Conversation
African Energy Week (AEW): Invest in African Energies 2026, taking place October 12–16 in Cape Town, provides a platform to examine coal’s practical role in Africa’s power mix. Discussions will focus on cleaner coal technologies, efficiency improvements, financing models, and the integration of coal to support productive sectors that cannot rely solely on intermittent or high-cost power.