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The Africa Minigrids Program
The Africa Minigrids Program (AMP) is UNDP’s most ambitious energy access program to date.
Why minigrids?
Renewable energy minigrids, and in particular solar-battery minigrids, offer great potential to address the 733 million people globally – including 567 million in sub-Saharan Africa – who currently don’t have access to electricity. This minigrid opportunity is centered around falling hardware costs (solar modules, batteries, energy efficient appliances), disruptive digital trends (mobile money, digital platforms and data), and innovative private sector business models.
A key challenge to scaling minigrids is mobilizing private sector investment and accelerating the learning curve for the complex array of stakeholders involved in delivering modern electricity services. Today, the minigrid market in Africa remains nascent, with the private sector facing a range of barriers holding back investment. Except in a few markets, nearly all current investment in minigrids is in the form of grants and noncommercial, patient capital. If minigrids are to truly scale, there is a need to access large volumes of commercial financing, and in particular commercial debt.
What is the AMP?
The AMP is a country-led technical assistance program for minigrids, active in an initial 21 African countries. AMP is expressly targeting early-stage minigrid markets, seeking to establish the enabling environment for subsequent private investment at scale. With GEF funding, the United Nations Development Programme will be implementing the program together with Rocky Mountain Institute (RMI) and the African Development Bank (AfDB), linking up with a wide array of minigrid stakeholders in Africa and beyond.
This comprehensive programme is also a multi-partner effort. With GEF funding, the United Nations Development Programme will be implementing the program together with Rocky Mountain Institute (RMI) and the African Development Bank (AfDB), linking up with a wide array of minigrid stakeholders in Africa and beyond. With various initiatives active in this space, the AMP has been designed to be additional and complement ongoing efforts to develop minigrid markets across Africa, and will further collaboration and partnerships during program implementation.
Our objective
The program’s objective is to support access to clean energy by increasing the financial viability, and promoting scaled up commercial investment, in low-carbon minigrids in Africa, with a focus on cost-reduction levers and innovative business models. This cost-reduction in hardware costs, soft costs and financing costs, in conjunction with innovative business models, will increase capital flows to the profit of end-users, who will benefit from lower tariffs and expanded service compared with the baseline.
Through its close work with governments, communities and partners, the AMP will significantly contribute to closing the energy access gap in participating countries.
How does the AMP work?
The AMP will have a country-based focus, while also maximising opportunities for SouthSouth/Triangular Cooperation and providing backstopping through an organised “chapeau” project. The program is comprised of two main elements:
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A Regional Project, structured as a ‘Knowledge Management' platform, to support the program’s National Projects, and the Africa minigrids market more generally, through four core sets of activities: (i) knowledge tools for both public and private actors; (ii) tailored technical assistance to countries; (iii) specialized regional Communities of Practice; and (iv) support for digitalization in the minigrids market.
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21 National Projects, each with a common architecture consisting of four components: (i) policy and regulations, (ii) business model innovation and private sector, (iii) innovative finance for minigrids scale-up, and (iv) digitalization, knowledge management and monitoring and evaluation.
The AMP architecture:
Key areas of focus
| Within the national projects architecture, the program has been designed to emphasize - and seek to develop comparative advantages – across three ‘key areas of opportunity’ i.e., national dialogues on delivery models, productive use of energy and digitalization for minigrids. Each of these represent a niche contribution by the AMP that targets cost-reduction, and in this way is complementary to existing baseline activities supporting minigrid investment in Africa. |
Three “Key Areas of Opportunity” for AMP to drive minigrid cost-reduction:
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