Speaking in Cape Town, South Africa, Obama said the Power Africa project would help guide the development of Africa's energy resources and expand production and transportation infrastructure needed to bring electricity to as many as 20 million homes and businesses in sub-Saharan Africa.
"Power Africa will bring to bear a wide range of U.S. government tools to support investment in Africa's energy sector," the White House said in a written statement.
Obama's plan would lay out $7 billion over five years. Most of the aid will come in the form of assistance with industry best-practices, insurance and technical advice for energy development. Alternative energy sources such as solar and hydropower along with traditional oil and natural gas will be used to increase generation in the region by an additional 10,000 megawatts.
Power Africa includes six African nations -- Ethiopia, Ghana, Kenya, Liberia, Nigeria, and Tanzania – and will also work with Mozambique and Uganda on petroleum development, the White House said.
Obama unveiled the proposal Sunday after he and his family toured toured South Africa's Robben Island, where former South African President Nelson Mandela was imprisoned for 18 years.
"On behalf of our family we're deeply humbled to stand where men of such courage faced down injustice and refused to yield. The world is grateful for the heroes of Robben Island, who remind us that no shackles or cells can match the strength of the human spirit," Obama said.
Obama also participated in a roundtable discussion Sunday at the Desmond Tutu HIV Foundation Youth Center in Cape Town.
"South Africa obviously has faced a heavy burden from HIV as well as other diseases -- tuberculosis, most recently," the president said. "But the great news is that South Africa is now leading the way in caring for its citizens, in paving the way for a brighter future for the South African people and their families, and I am very proud the United States has been such a terrific partner on this issue."
The president said the United States has spent "$3.7 billion in supporting South Africa's efforts to combat HIV and AIDS."
The human immunodeficiency virus is the cause of AIDS.
Susan Sarandon 'very excited' about daughter's pregnancy
Interpol investigating stolen passports on missing flight