For climate and livelihoods, Africa bets big on solar mini-grids

To the people of Mbiabet Esieyere and Mbiabet Udouba in Nigeria’s deep south, sundown would mean children doing their homework by the glow of kerosene lamps, and the faint thrum of generators emanating from homes that could afford to run them. Like many rural communities, these two villages of fishermen and farmers in the community of Mbiabet, tucked away in clearings within a dense palm forest, had never been connected to the country’s national electricity grid.

Most of the residents had never heard of solar power either. When, in 2021, a renewable-energy company proposed installing a solar “mini-grid” in their community, the villagers scoffed at the idea of the sun powering their homes. “We didn’t imagine that something [like this] can exist,” says Solomon Andrew Obot, a resident in his early 30s.

The small installation of solar panels, batteries and transmission lines proposed by the company Prado Power would service 180 households in Mbiabet Esieyere and Mbiabet Udouba, giving them significantly more reliable electricity for a fraction of the cost of diesel generators. Village leaders agreed to the installation, though many residents remained skeptical. But when the panels were set up in 2022, lights blinked on in the brightly painted two-room homes and tan mud huts dotted sparsely through the community. At a village meeting in September, locals erupted into laughter as they recalled walking from house to house, turning on lights and plugging in phone chargers. “I [was] shocked,” Andrew Obot says.

Like many African nations, Nigeria has lagged behind Global North countries in shifting away from planet-warming fossil fuels and toward renewable energy. Solar power contributes just around 3 percent of the total electricity generated in Africa—though it is the world’s sunniest continent—compared to nearly 12 percent in Germany and 6 percent in the United States.

At the same time, in many African countries, solar power now stands to offer much more than environmental benefits. About 600 million Africans lack reliable access to electricity; in Nigeria specifically, almost half of the 230 million people have no access to electricity grids. Today, solar has become cheap and versatile enough to help bring affordable, reliable power to millions—creating a win-win for lives and livelihoods as well as the climate.

That’s why Nigeria is placing its bets on solar mini-grids—small installations that produce up to 10 megawatts of electricity, enough to power over 1,700 American homes—that can be set up anywhere. Crucially, the country has pioneered mini-grid development through smart policies to attract investment, setting an example for other African nations.

Nearly 120 mini-grids are now installed, powering roughly 50,000 households and reaching about 250,000 people. “Nigeria is actually like a poster child for mini-grid development across Africa,” says energy expert Rolake Akinkugbe-Filani, managing director of EnergyInc Advisors, an energy infrastructure consulting firm.

Though it will take more work—and funding—to expand mini-grids across the continent, Nigeria’s experience demonstrates that they could play a key role in weaning African communities off fossil-fuel-based power. But the people who live there are more concerned with another, immediate benefit: improving livelihoods. Affordable, reliable power from Mbiabet’s mini-grid has already supercharged local businesses, as it has in many places where nonprofits like Clean Technology Hub have supported mini-grid development, says Ifeoma Malo, the organization’s founder. “We’ve seen how that has completely transformed those communities.”

The African energy transition takes shape

Together, Africa’s countries account for less than 5 percent of global carbon dioxide emissions, and many experts, like Malo, take issue with the idea that they need to rapidly phase out fossil fuels; that task should be more urgent for the United States, China, India, the European countries and Russia, which create the bulk of emissions. Nevertheless, many African countries have set ambitious phase-out goals. Some have already turned to locally abundant renewable energy sources, like geothermal power from the Earth’s crust, which supplies nearly half of the electricity produced in Kenya, and hydropower, which creates more than 80 percent of the electricity in the Democratic Republic of Congo, Ethiopia and Uganda.

But hydropower and geothermal work only where those resources naturally exist. And development of more geographically versatile power sources, like solar and wind, has progressed more slowly in Africa. Though solar is cheaper than fossil-fuel-derived electricity in the long term, upfront construction costs are often higher than they are for building new fossil-fuel power plants.

Getting loans to finance big-ticket energy projects is especially hard in Africa, too. Compared to Europe or the United States, interest rates for loans can be two to three times higher due to perceived risks—for instance, that cash-strapped utility companies, already struggling to collect bills from customers, won’t be able to pay back the loans. Rapid political shifts and currency fluctuations add to the uncertainty. To boot, some Western African nations such as Nigeria charge high tariffs on importing technologies such as solar panels. “There are challenges that are definitely hindering the pace at which renewable energy development could be scaling in the region,” says renewable energy expert Tim Reber of the Colorado-based US National Renewable Energy Laboratory.

Some African countries are beginning to overcome these barriers and spur renewable energy development, notes Bruno Merven, an expert in energy systems modeling at the University of Cape Town in South Africa, coauthor of a look at renewable energy development in the Annual Review of Resource Economics. Super-sunny Morocco, for example, has phased out subsidies for gasoline and industrial fuel. South Africa is agreeing to buy power from new, renewable infrastructure that is replacing many coal plants that are now being retired.

Nigeria, where only about a quarter of the national grid generates electricity and where many turn to generators for power, is leaning on mini-grids—since expanding the national grid to its remote communities, scattered across an area 1.3 times the size of Texas, would cost a prohibitive amount in the tens of billions of dollars. Many other countries are in the same boat. “The only way by which we can help to electrify the entire continent is to invest heavily in renewable energy mini-grids,” says Stephen Kansuk, the United Nations Development Program’s regional technical advisor for Africa on climate change mitigation and energy issues.

Experts praise the steps Nigeria has taken to spur such development. In 2016, the country’s Electricity Regulatory Commission provided legal guidelines on how developers, electricity distribution companies, regulators and communities can work together to develop the small grids. This was accompanied by a program through which organizations like the World Bank, the Global Energy Alliance for People and Planet, Bezos Earth Fund and the Rockefeller Foundation could contribute funds, making mini-grid investments less financially risky for developers.

Solar power was also made more attractive by a recent decision by Nigerian President Bola Ahmed Tinubu to remove a long-standing government subsidy on petroleum products. Fossil-fuel costs have been soaring since, for vehicles as well as the generators that many communities rely on. Nigeria has historically been Africa’s largest crude oil producer, but fuel is now largely unaffordable for the average Nigerian, including those living in rural areas, who often live on less than $2 a day. In the crude-oil-rich state of Akwa Ibom, where the Mbiabet villages are located, gasoline was 1,500 naira per liter (around $1) at the time of publishing. “Now that subsidies have come off petrol,” says Akinkugbe-Filani, “we’re seeing a lot more people transition to alternative sources of energy.”

Mini-grids take off

To plan a mini-grid in Nigeria, developers often work with government agencies that have mapped out ideal sites: sunny places where there are no plans to extend the national grid, ensuring that there’s a real power need.

The next step is getting communities on board, which can take months. Malo recalls a remote Indigenous village in the hills of Adamawa state in Nigeria’s northeast, where locals have preserved their way of life for hundreds of years and are wary of outsiders. Her team had almost given up trying to liaise with reluctant male community leaders and decided to try reaching out to the women. The women, it turned out, were fascinated by the technology and how it could help them, especially at night — to fetch water from streams, to use the bathroom and to keep their children safe from snakes. “We find that if we convince them, they’re able to go and convince their husbands,” Malo says.

The Mbiabet community took less convincing. Residents were drawn to the promise of cheap, reliable electricity and its potential to boost local businesses.

Like many other mini-grids, the one in Mbiabet benefited from a small grant, this one from the Rocky Mountain Institute, a US-based nonprofit focused on renewable energy adoption. The funds allowed residents to retain 20 percent ownership of the mini-grid and reduced upfront costs for Prado Power, which built the panels with the help of local laborers.

On a day in late September, it’s a sunny afternoon, though downpours from the days before have made their imprint on the ground. There are no paved roads and today, the dirt road leading through the tropical forest into the cluster of villages is unnavigable by car. At one point, we build an impromptu bridge of grass and vegetation across a sludgy impasse; the last stretch of the journey is made on foot. It would be costly and labor-intensive to extend the national grid here.

Palm trees give way to tin roofs propped up by wooden poles, and Andrew Obot is waiting at the meeting point. He was Mbiabet’s vice youth president when Prado Power first contacted the community; now he’s the site manager. He steers his okada—a local motorbike—up the bumpy red dirt road to go see the solar panels.

Along the way, we see transmission lines threading through thick foliage. “That’s the solar power,” shouts Andrew Obot over the drone of the okada engine. All the lines were built by Prado Power to supply households in the two villages.

We enter a grassy clearing where three rows of solar panels sit behind wire gates. Collectively, the 39 panels have a capacity of over 20 kilowatts—enough to power just one large, energy-intensive American household but more than enough for the lightbulbs, cooker plates and fans in the 180 households in Mbiabet Esieyere and Mbiabet Udouba.

Whereas before, electricity was more conservatively used, now it is everywhere. An Afrobeats tune blares from a small barbershop on the main road winding through Mbiabet Esieyere. Inside, surrounded by walls plastered with shiny posters of trending hairstyles — including a headshot of popular musician Davido with the tagline “BBC—Big Boyz Cutz”—two young girls sit on a bench near a humming fan, waiting for their heads to be shaved.

The salon owner, Christian Aniefiok Asuquo, started his business two years ago when he was 16, just before the panels were installed. Back then, his appliances were powered by a diesel generator, which he would fill with 2,000 naira worth (around $1.20) of fuel daily. This would last around an hour. Now, he spends just 2,000 naira a month on electricity. “I feel so good,” he says, and his customers, too, are happy. He used to charge 500 naira ($0.30) per haircut, but now charges 300 naira ($0.18) and still makes a profit. He has more customers these days.

For many Mbiabet residents, “it’s an overall boost in their economic development,” says Suleiman Babamanu, the Rocky Mountain Institute’s program director in Nigeria. Also helping to encourage residents to take full advantage of their newly available power is the installation of an “agro-processing hub,” equipped with crop-processing machines and a community freezer to store products like fish. Provided by the company Farm Warehouse in partnership with Prado Power, the hub is leased out to locals. It includes a grinder and fryer to process cassava—the community’s primary crop—into garri, a local food staple, which many of the village women sell to neighboring communities and at local markets.

The women are charged around 200 naira ($0.12) to process a small basin of garri from beginning to end. Sarah Eyakndue Monday, a 24-year-old cassava farmer, used to spend three to four hours processing cassava each day; it now takes her less than an hour. “It’s very easy,” she says with a laugh. She produces enough garri during that time to earn up to 50,000 naira ($30.25) a week—almost five times what she was earning before.

Prado Power also installed a battery system to save some power for nighttime (there’s a backup diesel generator should batteries become depleted during multiple overcast days). That has proved especially valuable to women in Mbiabet Esieyere and Mbiabet Udouba, who now feel safer. “Everywhere is … brighter than before,” says Eyakndue Monday.

Other African communities have experienced similar benefits, according to Renewvia Energy, a US-based solar company. In a recent company-funded survey, 2,658 Nigerian and Kenyan households and business owners were interviewed before and after they got access to Renewvia’s mini-grids. Remarkably, the median income of Kenyan households had quadrupled. Instead of spending hours each day walking kilometers to collect drinking water, many communities were able to install electricity-powered wells or pumps, along with water purifiers.

“With all of that extra time, women in the community were able to either start their own businesses or just participate in businesses that already exist,” says Renewvia engineer Nicholas Selby, “and, with that, gain some income for themselves.”

Navigating mini-grid challenges

Solar systems require regular maintenance—replacing retired batteries, cleaning, and repairing and addressing technical glitches over the 20- to 25-year lifetime of a panel. Unless plans for care are built into a project, they risk failure. In some parts of India, for example, thousands of mini-grids installed by the government in recent decades have fallen into disrepair, according to a report provided to The Washington Post. Typically, state agencies have little long-term incentive to maintain solar infrastructure, Kansuk says.

Kansuk says this is less likely in situations where private companies that make money off the grids help to fund them, encouraging them to install high-quality devices and maintain them. It also helps to train locals with engineering skills so they can maintain the panels themselves—companies like Renewvia have done this at their sites. Although Prado Power hasn’t been able to provide such training to locals in Mbiabet or their other sites, they recruit locals like Andrew Obot to work as security guards, site managers and construction workers.

Over the longer term, demographic shifts may also leave some mini-grids in isolated areas abandoned—as in northern Nigeria, for instance, where banditry and kidnapping are forcing rural populations toward more urban settings. “That’s become a huge issue,” Malo says. Partly for this reason, some developers are focusing on building mini-grids in regions that are less prone to violence and have higher economic activity—often constructing interconnected mini-grids that supply multiple communities.

Eventually, those close enough to the national grid will likely be connected to the larger system, says Chibuikem Agbaegbu, a Nigeria-based climate and energy expert of the Africa Policy Research Institute. They can send their excess solar-sourced electricity into the main grid, thus making a region’s overall energy system greener and more reliable.

The biggest challenge for mini-grids, however, is cost. Although they tend to offer cheaper, more reliable electricity compared to fossil-fuel-powered generators, it is still quite expensive for many people — and often much more costly than power from national grids, which is frequently subsidized by African governments. Costs can be even higher when communities sprawl across large areas that are expensive to connect.

Mini-grid companies have to charge relatively high rates in order to break even, and many communities may not be buying enough power to make a mini-grid worthwhile for the developers — for instance, Kansuk says, if residents want electricity only for lighting and to run small household appliances.

Kansuk adds that this is why developers like Prado Power still rely on grants or other funding sources to subsidize construction costs so they can charge locals affordable prices for electricity. Another solution, as evidenced in Mbiabet, is to introduce industrial machinery and equipment in tandem with mini-grids to increase local incomes so that people can afford the electricity tariffs.

“For you to be able to really transform lives in rural communities, you need to be able to improve the business viability—both for the mini-grid and for the community,” says Babamanu. The Rocky Mountain Institute is part of an initiative that identifies suitable electrical products, from cold storage to rice mills to electric vehicle chargers, and supports their installation in communities with the mini-grids.

Spreading mini-grids across the continent

Energy experts believe that these kinds of solutions will be key for expanding mini-grids across Africa. Around 60 million people in the continent gained access to electricity through mini-grids between 2009 and 2019, in countries such as Kenya, Tanzania and Senegal, and the United Nations Development Program is working with a total of 21 African countries, Kansuk says, including Mali, Niger and Somalia, to incentivize private companies to develop mini-grids there.

But it takes more than robust policies to help mini-grids thrive. Malo says it would help if Western African countries removed import tariffs for solar panels, as many governments in Eastern Africa have done. And though Agbaegbu estimates that Nigeria has seen over $900 million in solar investments since 2018—and the nation recently announced $750 million more through a multinationally funded program that aims to provide over 17.5 million Nigerians with electricity access—it needs more. “If you look at what is required versus what is available,” says Agbaegbu, “you find that there’s still a significant gap.”

Many in the field argue that such money should come from more industrialized, carbon-emitting countries to help pay for energy development in Global South countries in ways that don’t add to the climate problem; some also argue for funds to compensate for damages caused by climate impacts, which hit these countries hardest. At the 2024 COP29 climate change conference, wealthy nations set a target of $300 billion in annual funding for climate initiatives in other countries by 2035—three times more than what they had previously pledged. But African countries alone need an estimated $200 billion per year by 2030 to meet their energy goals, according to the International Energy Agency.

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