With up to 500 million people living without access to modern electricity across the world and a lack of adequate investments hindering energy access initiatives in developing economies, the roadmap will drive investments to accelerate technology deployment and has the potential to end energy poverty by improving the commercial viability of off-grid solar mini-grids.
Jon Exel, Team Lead for the World Bank ESMAP’s global facility on mini-grids, stated that, “Now more than ever, solar mini-grids are a core solution for closing the energy access gap. The new industry roadmap clearly outlines actions needed from private sector companies to realize the full potential of solar mini-grids. Policy and finance actions are also needed, such as embedding mini-grids into national electrification plans and devising financing solutions more suitable for large portfolios of smaller projects.”
To achieve large-scale rollout of solar mini-grids, the roadmap recommends that the industry prioritizes the development and adoption of sustainable business models at site and portfolio levels with cost, quality of service and demand shaping projects rollout; reduces the cost of project rollout and solar electricity further down to $0.20 kWh by 2030; increases the demand for clean energy significantly with developers shifting from a pure utility model to an energy services model; increases market players as currently only three firms account for 80% of market share; and modernizes market segmentation.
Brad Mattson, Chairman of Husk Power Systems, added thats “In spite of the urgent need, the mini-grid industry has yet to produce a profitable company. There are strong signs that the industry is maturing, but remaining barriers to sustainability and scale require a new level of ambition and clarity, and a proven formula with quantifiable metrics.”
The launch of the roadmap comes at a time when only 10% of the needed 200,000 microgrids to ensure energy access for all are in operation. Now, with the roadmap, companies are better positioned to understand the market, kickstart project developments and usher in a new era of electricity access on the back of solar.