Abstract
The lack of access to electricity of more than 1.1 billion people around the world remains a major developmental challenge and Goal 7 of the Sustainable Development Goals (SDG) as well as Sustainable Energy for All (SE4ALL) have set a target of universal electrification by 2030. Various studies have identified mini-grid-based electrification as a possible solution. There is a growing body of literature available now that has explored the feasibility, practical application and policy interventions required to support mini-grids. Through a review of available literature, this paper explores whether mini-grids can be a solution for the base of the pyramid (BoP) market and the challenges faced in deploying mini-grids in such markets. Interventions to support the mini-grid deployment are also discussed. The paper finds that the mini-grids are targeting the BoP market but the business is not attractive in profitability terms and requires financial support. Lack of regulatory clarity and non-coordinated policies affect the financial viability of projects, which requires careful support. Mini-grid electrification has hardly been embedded in rural development agenda and hence they have not contributed significantly to livelihood generation. Careful realignment of policies, regulatory frameworks and support systems can better support mini-grid deployment in developing countries.
Highlights
Energy access is the golden thread that joins three sustainability dimensions—economic prosperity, social development and living within environmental limits
Bhattacharyya [2] found that households with an income of less than $1000 per person in 2005 purchasing power parity (PPP) generally lack access to clean energy, which in turn leads to poor Human Development Indicators (HDI) scores
This paper presents a critical review of available literature on mini-grid development and explores whether mini-grids can be a solution for the population at the base of the pyramid (BoP), what challenges the mini-grid business face and how such options can be supported to make the option more effective for universal electrification
Summary
Energy access is the golden thread that joins three sustainability dimensions—economic prosperity, social development and living within environmental limits. Bhattacharyya [2] found that households with an income of less than $1000 per person in 2005 purchasing power parity (PPP) generally lack access to clean energy, which in turn leads to poor Human Development Indicators (HDI) scores. Rural Electrification [8] provides examples of mini-grid projects from around the world. This paper presents a critical review of available literature on mini-grid development and explores whether mini-grids can be a solution for the population at the base of the pyramid (BoP), what challenges the mini-grid business face and how such options can be supported to make the option more effective for universal electrification.
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