United Nations has called on
businesses, governments, and
civil society to achieve Sustainable
Energy for All by 2030
Accelerating Mini-grid Deployment for Energy Access
Green Mini-Grids Africa – Update on the DFID-Supported Programme
By: Steven Hunt, Deputy Team Leader, Sustainable Energy Team, UK Department for International Development
The Green Mini-Grids Africa programme aims to help transform the Green Mini-Grids (GMGs) sector in Africa into a thriving industry on track to deliver IEA’s estimate that over 40% of universal access to electricity by 2030 will be most economically delivered by mini-grids. The intention is to achieve this by supporting a critical mass of experience and evidence of success in the two countries of Kenya and Tanzania, coupled with improved policy and market conditions for mini-grids regionally.
The UK will provide total support of £75m from the International Climate Fund, of which £60m is intended to support project preparation and leverage private investment in Green Mini-Grids in Kenya and Tanzania. The remaining £15m will support a regional facility for market preparation, evidence and policy development, and prepare for wider scale-up of Green Mini-Grids across Africa. Funding commenced in 2014 and will run until 2019.
From late 2012, the UK Department for International Development (DFID) ran a series of consultations, research, analysis and modelling activities to consider if and how the UK’s International Climate Fund (ICF) could play a potentially transformational role in accelerating the growth of the Green Mini-Grids (GMGs) sector in Africa. This exercise collected evidence on the opportunities and barriers to scale-up, and explored the potential for green mini-grids in a number of countries. The report is available online here. Following up on this, a substantial programme of support was approved in mid-2014.
The DFID-Supported programme consists of 4 projects:
- GMGs Kenya – working with the French development agency AFD, providing support to project preparation and capital/credit availability
- GMGs Tanzania – part of a comprehensive package of support on energy working with the Tanzanian Rural Energy Agency, the Swedish development agency SIDA and the World Bank, providing support to project preparation and capital/credit availability
- GMGs Africa Regional Facility – working with the Sustainable Energy Fund for Africa (SEFA) (co-funded by Denmark and USAID/Power Africa) and the Sustainable Energy for All (SE4All) Africa Hub at the African Development Bank (AfDB), to provide a series of business lines of support to countries and the sector to develop GMGs markets
- GMGs Action Learning and Evaluation – working with the Energy Sector Management Assistance Programme (ESMAP) at the World Bank, as part of their new Global GMGs Facility (Denmark has also pledged support to the programme), to commission research into knowledge and data gaps, as well as to convene and exchange learning in the sector.
In the past 12 months these four projects have been moving through intensive inception phases, putting in place the agreements and staffing needed to deliver their complementary roles. Each has seen successes and challenges:
In Kenya, a dynamic market responded strongly to a call for expressions of interest in the programme in early 2015, providing evidence of a strong and quality pipeline of mini-grids firms and projects. In the same period, Powerhive became the first private mini-grid firm in Kenya to be granted a license to distribute power, however, key uncertainties in the regulatory environment for private provision of mini-grid power remain. Nonetheless, the inception phase is in the final stages with flexible support instruments in Kenya expected to open mid-2016.
In Tanzania, a multi-donor effort is building on the positive regulatory foundation for rural electrification and mini-grids in particular, with a comprehensive programme of support integrating Sweden, World Bank and UK support working with the Rural Energy Agency (REA). However, while intergovernmental co-operation provides a long term framework for coordinated support, it takes time to put in place. The next stage is tendering out the consolidated Technical Assistance/Management function and the support, expected to focus on project preparation, results-based financing, and credit-lines, will be in the market likely in the second half of next year.
The GMGs Regional Facility at the AfDB/SE4ALL Africa Hub has started strongly recruiting a mini-grid specialist and having a project on support to GMGs regulation in Mozambique approved as well as the first phase of the GMGs Market Development Programme (MDP) after a consultation process involving the members of the Clean Energy Mini-grids initiative of SE4ALL. The MDP includes business lines on market intelligence, business development support, access to finance, policy and quality assurance and tenders are currently in process on the first three of these. A call for expressions of interest from African governments for support on policy, legal and regulatory matters regarding their mini-grids markets was launched at the 2015 SE4ALL Forum in May, and received an extremely strong response from 20 countries, with six countries having been selected for possible SEFA support in 2015-16.
The Action Learning and Evaluation component convened the first learning and exchange event in Dar- es Salaam, Tanzania in March 2015, which brought together the programme as a whole for the first time along with leading mini-grids developers. The group was able to participate in a field visit to see the pioneering mini-grids of Devergy near Morogoro (see photographs). A Research Advisory Group has been appointed to oversee commissioning of research and a new Senior Energy Specialist, who is the task team leader for the Global Facility for the Promotion of Clean Energy Mini-Grids is now in place at the World Bank/ESMAP. The first call for proposals on evidence and innovation should be issued in early 2016.
The DFID-supported GMGs Africa programme is intended to be fully integrated into the Clean Energy Mini-Grids work of the Sustainable Energy for All Initiative, and forms the UK’s main contribution to its objectives. At the country levels, working in partnership, it is hoped that support in Kenya and Tanzania will help these countries develop critical mass of GMGs deployment and experience with regional significance. The resources provided to the World Bank and African Development Bank are intended to help further countries develop their mini-grids sectors, as well as support the mini-grids sector at regional level to develop, learn and reach more people – as a contribution towards the objectives of the Global Goal 7, to ensure access to affordable, reliable, sustainable and modern energy for all.
For further information on the GMGs Africa programme, please contact
GMGs Kenya – Sabita-Thapa@dfid.gov.uk, email@example.com
GMGs Tanzania – T.Bushell@dfid.gov.uk, firstname.lastname@example.org
GMGs Regional Facility – S-Hunt@dfid.gov.uk, J.Cunha@afdb.org
Action Learning and Evaluation – S-Hunt@dfid.gov.uk, email@example.com
General Inquiries – S-Hunt@dfid.gov.uk