Solar mini-grids could provide an uninterrupted supply of high-quality electricity to nearly half a billion people living in areas that lack it and provide a low-cost solution to closing the electricity access gap. energy by 2030, according to a new World Bank report.
“To realize the full potential of solar mini-grids, governments and industry players must work together to systematically identify opportunities, continue to drive down costs and remove barriers to financing. “, indicates the financial institution in a press release.
About 733 million people in the world (mainly in sub-Saharan Africa) still do not have access to electricity. The pace of electrification has slowed in recent years, due to difficulties in reaching the most remote and vulnerable populations, as well as the devastating effects of the COVID-19 pandemic. At the current rate, 670 million people will still be without electricity by 2030.
“Now more than ever, solar mini-grids are a key solution to closing the energy access gap,” said Riccardo Puliti, World Bank Vice President for Infrastructure. The World Bank is reportedly stepping up its support for mini-grids as part of its broader support for the development of comprehensive electrification programs. “At $1.4 billion across 30 countries, our mini-grid power commitments represent about a quarter of the total public and private sector investment in our client countries. For mini-grids to serve half a billion people by 2030, all actors in the sector must take action, in particular by integrating these systems into national electrification plans and by designing solutions financing adapted to the specific risks presented by such projects”, notes the same source. The deployment of solar mini-grids has accelerated sharply, from around 50 projects per country per year in 2018 to more than 150 today, and this more particularly in countries where the rate of access to electricity is electricity are the lowest. This growth can be explained by the fall in the cost of essential components, the introduction of new digital solutions, the presence of a large and growing pool of very competent promoters, and growing economies of scale.
According to the Bretton Woods institution, solar mini-grids have become the cheapest way to provide high-quality 24/7 electricity to urban centers that are not connected to the electricity grid or who regularly experience power outages. Connecting 490 million people to solar mini-grids would avoid the emission of 1.2 billion tons of CO2.
“However, it will be necessary to accelerate the pace of deployment if Sustainable Development Goal 7 (SDG 7) is to be achieved. In order to supply electricity to 490 million people by 2030, it will be necessary to build more than 217,000 mini-grids, at a cumulative cost of 127 billion dollars. At the current rate, only 44,800 new mini-grids serving 80 million people will be built by then, at a total investment cost of $37 billion,” the new report highlights, identifying five “market drivers” that enable the full potential of this sector to be realized and promote its contribution to universal electrification efforts. The aim is to reduce the cost of electricity from hybrid solar mini-grids to $0.20/kWh by 2030, accelerate the deployment of mini-grids to install 2,000 mini-grids per country and per year, providing excellent service to customers and communities, leveraging funding from development partners and governments to leverage private sector finance, and creating a business-friendly environment for mini-grids in key access-deficit countries through flexible and responsive regulations, supportive policies and red tape reduction.