NextBillion - A WDI Publication

The energy access sector has a math problem.

According to the latest Off-Grid Solar Market Trends Report from GOGLA and the World Bank, closing the last-mile electricity gap requires $21 billion in investment for off-grid solar alone. Yet in 2024, total investment in off-grid solar companies fell by 30%, landing at just under $300 million. Meanwhile, 685 million people remain without electricity globally, and if action isn’t taken to accelerate access, less than 4% of this population will be electrified by 2030.

The typical response to this gap is familiar and understandable: Calls for more money, more concessional finance, more government support, more private capital. But given the size of the problem, these calls alone are not enough.

It’s clear that a new approach is needed, and buried in the history of the energy access sector is a model that could provide it: open source. In the open source model, energy access innovators choose to share their work freely rather than protecting it. But though open source approaches can multiply the impact of every dollar already committed, most funders and investors have yet to take this model seriously.

The Multiplication Effect

At the EnAccess Foundation, where I serve as Managing Director, we have spent years documenting, curating and demonstrating what happens when energy access innovators choose to open source. The results challenge the conventional logic of proprietary development.

The economic case for open source is well established beyond the energy access sector. Research from Harvard Business School found that firms would need to spend 3.5 times more on software than they currently do if open source software did not exist. A European Commission study found a cost-benefit ratio of above 1:4 for public investment in open source, meaning every euro invested in open source software generates at least four in value. The same study projected a 10% increase in open source software contributions would produce more than 600 additional technology start-ups annually in the EU alone. Although energy access involves physical hardware, its digital layer — including software, firmware, interoperability standards and data platforms — likely benefits from the same open source software economics.

We see the returns to open sourcing in our work. We supported the development of the OpenPAYGO Token, the open source technology that enables pay-as-you-go energy systems to work across different platforms, and advocated for its adoption. As an open source and, therefore, free alternative, OpenPAYGO became the default platform and unlocked interoperability across most of the sector’s leading PAYGO platforms. Our assessment of the token found an estimated $700,000 in annual savings for the sector from a single open source initiative.

The Duplication Problem

The aforementioned GOGLA/World Bank report concluded that only 22% of households lacking electricity can afford even a basic Tier 1 solar energy kit on a pay-as-you-go basis. That affordability gap has multiple causes, but one is often overlooked: duplication.

In EnAccess’ work across the energy access ecosystem, we repeatedly see companies, NGOs, and donors tackling the same baseline problems in silos: building software to solve problems others have already solved, designing custom hardware protocols, and developing parallel business frameworks from scratch. This duplication doesn’t just waste money. It raises operating costs across the sector, and those costs are ultimately passed on to customers, delaying the day when affordable, high-quality energy products and services are within reach for everyone. Funders often support these duplicative efforts without realising it. Open source attacks this duplication problem directly. When a solution is documented and published freely, the next organisation that needs it doesn’t have to rebuild from scratch. Instead, they can adapt and improve the existing open source solution, deploy it faster, and contribute their innovations back to the ecosystem. Open source will not, on its own, close the estimated $21 billion investment gap the off-grid solar sector faces. But funding shared digital tools rather than parallel proprietary systems ensures that every available dollar goes significantly further toward closing it. That gap is large enough that the sector can’t afford not to invest in solutions, like open source, that can help close it.

The Business Case for Open Source Is Real

A common objection to open source is that it undermines commercial viability: In other words, a business may worry that sharing its work forfeits its competitive advantage to rivals. The evidence from our sector tells a different story.

When Solaris Offgrid (now Masunga) partnered with EnAccess to develop and open source the OpenPAYGO Token, they removed one of the biggest barriers to pay-as-you-go (PAYGO) adoption. Until then, PAYGO technology was largely proprietary: Manufacturers offering PAYGO for their products had to build their own token systems or license one, which tied them to a single software provider. That cost and lock-in kept many smaller manufacturers — particularly those making appliances like fans, TVs and water pumps — out of the PAYGO market altogether. In contrast, with a free, open and interoperable token, any manufacturer could embed PAYGO functionality into their devices at minimal cost, and distributors could sell products from different manufacturers through the same system.

Following the introduction of OpenPAYGO, the number of PAYGO-enabled products grew, and with it the number of companies needing software to manage payments, customers and device activation. That expanded demand for Masunga’s core product, the PaygOps platform, which becomes more valuable when more manufacturers offer pay-as-you-go products. Open source grew the market and the market grew Masunga’s revenue. The company is now releasing the Open Source PaygOps community edition of their platform.

Other companies, programmes and governments are also leveraging open source approaches to unlock greater impact. For instance, governments in Burundi, Malawi, Uganda and Tanzania are using Prospect, an open source platform developed by the Access to Energy Institute (A2EI) to track national electrification programmes, to track and visualise their electrification data. But despite the popularity of the Prospect platform, A2EI isn’t the one implementing and hosting it. Instead, local IT consultancies and service providers do: they deploy, customise and maintain Prospect for their own clients, building sustainable businesses around a world-class tool they could never have afforded to develop themselves.

The same pattern plays out at a larger scale with the Energy Access Explorer, an open source geospatial planning platform developed by the World Resources Institute (WRI). Launched in 2019 as the first open source interactive platform for energy access planning, it now serves more than 100 governments across eight countries with over 25,000 users, and was certified by the Digital Public Goods Alliance as the first digital public good for energy. In Ethiopia, the Ministry of Water and Energy and the World Bank used the platform to target off-grid electrification financing across 145 high-need districts, unlocking clean power for over 19 million people. That is the sector-wide impact open source platforms enable when they are built to be shared.

Far from a standalone business model, open source operates as a sector-wide capital engine. Whether funded by grants as a non-profit public good like A2EI or WRI, or leveraged by commercial players like Masunga to drive adoption of their proprietary services, the result for local enterprises is the same. Someone else absorbs the baseline R&D costs and gives local operators equal access to foundational technology, without the need to pay proprietary software licensing fees.

That is what open source actually looks like as an economic development model. It puts local enterprises on a level playing field with other larger and often international players, without requiring anyone to write a cheque for the underlying technology. It allows more dynamic innovation and facilitates the development of new and diverse commercial and proprietary business models that can boost synergies across the ecosystem.

What Funders and Investors Need to Start Asking

The investment community and the public sector largely treat open source as a public good to be funded by philanthropy, separate from the “real” day-to-day operations and business of energy access. This framing is a mistake.

Open source infrastructure in energy access — including shared software, open hardware designs, interoperability standards and open data platforms — is as fundamental to sector growth as roads are to logistics. It lowers the cost of entering the market, so more companies can launch products and reach new customers. It speeds up innovation, letting businesses build on proven tools rather than starting from scratch, and it creates the transparent, interoperable systems that give investors the confidence to back companies at scale. The result is a larger market with more opportunities for returns.

Funders serious about closing the energy access gap should be asking every project they support: Is the work being documented and shared in a way that benefits the whole sector, or is it simply creating another silo? Is this a one-time solution, or a building block others can adapt and improve? Does it build interoperability?

The sector doesn’t have enough money to close the energy access gap the slow, proprietary way. Open source, when done properly, documented well, and maintained and supported with adopter and user community engagement, is how we get there faster.

Vivien Barnier is Managing Director of the EnAccess Foundation, which supports and maintains a library of open source tools for the energy access sector.

Photo credit: Thinnapob