16 October 2017 | Article
Access to electricity is a central building block of socio-economic development. It empowers people and communities to increase their income and productivity, enhance their access to healthcare, water and education, and improves their overall well-being. Without universal access to modern energy services, achieving the Sustainable Development Goals set for 2030 will be nearly impossible.
The good news is that the technology solutions needed to extend electricity access to the over 1.1 billion people already exists. The business case to deploy off-grid renewable energy solutions (stand-alone and mini-grid systems) in rural areas has never been stronger. Costs have fallen dramatically – over 80% since 2010 for PV panels, with substantial improvements in technology efficiency and reliability. The modularity of renewable energy technologies mean that they can be rapidly deployed and customised to meet energy demand using locally available resources and capacities.
An estimated 60% of the additional power generation needed to achieve universal access must come from off-grid solutions. Most of these will involve mini-grids – isolated, community-level power grids, which can eventually be absorbed into the main grid or may continue to operate autonomously. Policies and regulations for private sector renewable energy mini-grids aim to support policy makers in the design of enabling policy and regulatory frameworks. The report examines licencing, tariff regulation, risks related to main-grid arrival, and access to finance – the key factors investors in mini-grids consider.