Energy Capital & Power

Solar Mini-Grids Could be the Solution to Ending Energy Poverty in Africa

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Solar Mini Grids. World Bank. Bigstock.

The launch of the report comes at a time when the penetration of solar mini-grids has increased from 50 per country per annum in 2018 to over 150 per country per year owing to factors such as decreases in the costs of key solar components; an increase in the deployment of new and innovative digital energy solutions; and the continued decline in the costs of electricity generated from solar – costs have decreased from $0.55/kWh in 2018 to $0.38/kWh today, states the report.

With the current pace of solar mini-grid deployment standing at 44,800 new grids which are expected to be built by 2030 – serving approximately 80 million people – urgent action is required to improve deployment if energy poverty is to be alleviated. As such, the World Bank has identified five market drivers that are set to drive investment and development within the solar mini-grid space.

Firstly, reducing the cost of electricity from such systems to $0.20/hWh by 2030; secondly, increasing the pace of deployment from the current 150 grids to 2,000 grids per country per year – focusing on the creation of portfolios rather than isolated developments -; thirdly, providing reliable electricity for three million income-generating appliances and machines, as well as 200,000 schools and clinics; fourthly, capitalizing on development partner funding and government cooperation to scale-up private sector financing – this method would allow up to $127 billion in cumulative investment to be raised -; and lastly, establishing enabling mini-grid business environments through adapted regulation, supportive policies and the reduction of ineffective legislature and red tape.

According to Riccardo Puliti, Infrastructure Vice President at the World Bank, “The World Bank has been scaling up its support to mini-grids as part of helping countries develop comprehensive electrification programs. To realize mini grids’ full potential to connect half a billion people by 2030, several actions are needed, such as incorporating mini-grids into national electrification plans and devising financing solutions adapted to mini-grid projects’ risk profiles.”

Find out more about this study.

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Nicholas Nhede

Nicholas Nhede

Nicholas is an energy sector journalist with a passion on how technology and diversification of the energy mix can be used to address energy sector challenges. Nicholas holds a diploma in Journalism and Communication studies and has been covering energy-related topics including the Internet of Things, distributed energy and digitalisation since 2015.