October 27

Disconnects Between Minigrid Policy Stakeholders Keep Sector’s Bankability at Bay

By Benjamin Attia, Emily Chessin, and Artie Abal

The energy access minigrid sector is simultaneously a nascent market and a cleaner reprise of a familiar technology set’s debut role as the original building block of the modern grid, targeted at underserved populations. This duality positions the sector as a fundamental piece of the integrated electrification puzzle.

But despite consistent business-model innovation, steep cost learning rates and a rapidly diversifying competitive landscape, minigrids are still largely stuck in the “missing middle” and have yet to scale on a trajectory reflective of their massive potential. Recent estimates from the Minigrids Partnership suggest that minigrids could serve 111 million households (approximately 550 million to 600 million people) in sub-Saharan Africa, Asia and island nations by 2030, but the World Bank’s Energy Sector Management Assistance Program estimates there are currently only about 47 million people connected to minigrids (under a very inclusive definition of minigrid system architectures). The African Minigrid Developers Association reports that its members serve about 250,000 people.

Photo courtesy of jplenio.

Source: Greentech Media (link opens in a new window)

Energy, Finance, Technology
business development, energy access, public policy