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publication June 25, 2019

Mini Grids for Half a Billion People: Market Outlook and Handbook for Decision Makers

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STORY HIGHLIGHTS

  • Mini grids have the potential to provide electricity to as many as 500 million people by 2030, with the right policies and about $220 billion of investment to build around 210,000 mini grids.
  • Over the past decade, mini grid costs have declined significantly, while the quality of service has increased. The per kWh cost of mini grid electricity is expected to decrease by two thirds by 2030.
  • Significantly more mini grids will need to be deployed in the top 20 electricity access deficit countries – from 10-50 mini grids currently deployed each year per country to over 1,600.

Mini Grids for Half a Billion People: Market Outlook and Handbook for Decision Makers is the most comprehensive study on mini grids to date. It provides policy makers, investors and developers with insights on how mini grids can be scaled up.

The report also takes stock of the global mini grid market and industry, analyses costs and technological innovations and shows the importance of micro-finance and income-generating uses of electricity.

Reaching the remaining unserved population, including those connected to frail and overburdened urban grids, or living in remote areas and fragile and conflict environments, will require strong policies, increased private financing and comprehensive approaches to national electrification planning – which consists of main grid extensions, mini grids, and off-grid solar systems.

Estimates show that to achieve universal access to electricity by 2030, 40 percent of all installed capacity will have to come from mini grids. At present the total mini grid investment in countries with low levels of electricity access in Africa and Asia totals $5 billion.

In addition to being cost-efficient, mini grids have many other benefits. They have positive environmental impacts: 210,000 mini grids powered by solar energy would help avoid 1.5 billion tons of CO2 emissions globally.

They also offer national utilities a win-win solution in the electricity sector by paving the way for more financially viable future grid expansion. By the time the main grid arrives, significant demand for electricity would already exist and customers would have greater ability to pay through the generation of productive uses made possible by mini grids.

 


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