Obama was in South Africa on the second leg of a three-nation African tour that started in Senegal last Wednesday and continued in Tanzania on Monday.
According to Times Live, the initiative, which will bring "light where there is currently darkness," will focus on boosting access to electricity in Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania.
The Power Africa initiative will receive $7-billion in US investment and an additional $9-billion in commitments from private companies including General Electric and Symbion Power.
Times Live reported that Power Africa would focus on expanding the reach of power grids and investing in renewable energy sources such as geothermal, hydro, solar, and wind power.
Times Live quoted President Obama as saying: "It's the connection that's needed to plug Africa into the grid of the global economy."
While the initiative may be a step in the right direction, Times Live reported that the International Energy Agency puts the figure required to achieve universal access to electricity in sub-Saharan Africa by 2030 at around $300-billion.