The World Bank Group has partnered with the African Development Bank to provide first-time electricity access to 300 million people who are currently off-grid across Africa over the next six years.
Under a programme dubbed Mission 300 initiative World Bank said off-grid solar will play a critical role in reaching households, as well as accelerating electricity access for businesses, schools, and health centres, unlocking development across sectors.
“Providing access to affordable, clean electricity is critical for lifting people out of poverty on a livable planet, and we must be bold in our commitment to doing so,” World Bank’s Country Director for Kenya, Rwanda, Somalia and Uganda Qimiao Fan said.
World Bank, in its recent Off-Grid Solar Market Trends Report (MTR), 2024 estimates that 685 million people are still living in energy poverty.
According to the global lender, the number has grown for the first time in two decades and, without immediate action, 660 million people will remain without access by 2030.
“Off-grid solar solutions would be the most cost-effective way to reach 41 per cent of them (398 million people),” World Bank said.
It added: “The off-grid solar sector has shown tremendous resilience over the past two years in challenging macroeconomic conditions. As of 2023, off-grid solar solutions were estimated to benefit over 560 million people. Despite soaring inflation and extreme currency devaluations, among other factors, more than 50 million OGS products were sold in 2022 and 2023. Market turnover reached Sh502 billion in 2022 and Sh490 billion in 2023.”
The report further stated that investment into the off-grid solar sector reached a high of Sh155 billion during the 2022-23 period, largely driven by debt financing.
However, World Bank said that a six times increase in public funding is necessary to raise Sh2.7 trillion to electrify all the 398 million people who would be most efficiently connected via off-grid solar.
An additional Sh9.5 trillion would cover the addressable markets for solar water pumps, cold storage solutions, and Tier 2+ OGS solutions for Micro, Small and Medium-sized Enterprises (MSMEs).
Off-grid solar
While supporting the World Bank’s report findings, association for the off-grid solar energy industry (GOGLA) said off-grid solar has been proven as the most effective route to reach almost 400 million unelectrified people, delivering life-changing energy solutions to power their homes, farms, businesses, and public services.
“The industry has shown tremendous resilience in challenging macroeconomic conditions. Companies, investors, governments, and development partners need to work together now to unlock the $21 billion needed to create a financially sustainable off-grid solar sector, that can scale, serve the hardest-to-reach and help achieve energy access and climate goals and ambitious initiatives like M300,” said Sarah Malm, Executive Director at GOGLA.
World Bank called on companies, investors, governments and development partners to work together to ensure off-grid solar fulfils its potential, enabling the achievement of Sustainable Development Goals (SDG) 7, and having a transformative impact on households, businesses, farmers and social infrastructure.
“Affordability (of energy) remains a critical barrier for households. Only 22 per cent of households lacking electricity can afford the monthly payment for a Tier 1 solar energy kit on PAYG (a monthly payment system that increases affordability for those users who can’t afford an upfront cash payment). In conflict-affected areas, where 82 per cent of people lacking access live, prices to offer PAYG are 57 per cent higher, making them even less affordable,” World Bank said in the report.
