Lighting Up Africa: Niger’s Smart Approach to Attract Private Mini Grid Investment

The World Bank’s pilot in Niger introduces a comprehensive, tech-driven model to attract private investment in solar hybrid mini grids, aiming to accelerate energy access. Using geospatial tools and regulatory reforms, the approach offers a scalable blueprint for electrification across Africa.

In an ambitious push to electrify Africa’s most underserved regions, the World Bank and the African Development Bank launched the M300 initiative in 2024, aiming to connect 300 million people to electricity by 2030. At the center of this effort lies the deployment of solar hybrid mini grids—a promising, scalable solution for remote areas. To guide this initiative, a groundbreaking market readiness assessment was piloted in Niger by a consortium led by Trama TechnoAmbiental, TFE Energy/VIDA Analytics, and Economic Consulting Associates, under the World Bank’s Energy Sector Management Assistance Program (ESMAP). This detailed framework, rooted in a ten-pillar approach, may now serve as a replicable model for other countries seeking to attract private sector investment in mini grids.

Niger’s Power Deficit and Growing Ambition

Niger, a vast landlocked country with over 26 million people, 80 percent of whom live in rural areas has one of the lowest electricity access rates in Sub-Saharan Africa. In 2022, only 19.5 percent of households were connected to electricity through either grid or off-grid solutions. In response, the government adopted a National Electrification Strategy and Plan with a bold target: 80 percent electricity access by 2035. With strong backing from the World Bank, key projects like the Niger Solar Electricity Access Project (NESAP) and its successor, Haské, have already begun to shift the landscape. NESAP hybridized diesel mini grids with solar energy, electrified 73 health centers during the COVID-19 crisis, and launched six new solar mini grids using a fixed-tariff model. Yet despite this progress, the mini grid market remains in its infancy, and private sector involvement has been limited.

Mapping the Future with Technology

The centerpiece of the Niger assessment is the Niger Mini Grid Atlas—a sophisticated, interactive mapping tool developed using the VIDA platform. It identifies over 27,000 potential unelectrified settlements across the country. By combining machine learning with geospatial and socioeconomic data, the Atlas estimates electricity demand, infrastructure needs, and investment costs at each site. Field surveys in 35 villages helped calibrate the tool to Niger’s context, generating detailed load profiles for households, businesses, and institutions. This enabled tailored grid designs, accurate sizing of solar systems, and financial modeling of various implementation approaches.

The Atlas doesn't just serve as a planning tool; it's also a powerful platform for investment decision-making. Users can filter and cluster viable sites into project portfolios, assess costs, and prioritize areas based on technical feasibility and development impact. Already, the Haské project is leveraging the Atlas to prepare a tender for 32 mini-grids that will electrify 36 settlements. This marks a significant step forward in strategic, data-driven electrification planning.

Building the Right Environment for Investment

Alongside the Atlas, the study delved into the institutional and financial ecosystem for mini-grid development. While Niger enacted an Electricity Code in 2016 and a rural electrification decree in 2019, important issues—such as tariff-setting, the role of local authorities, and financing mechanisms—remained unresolved. To address these, a new electricity code is being drafted. This legislation proposes clearer pathways for awarding projects, including competitive concessions and unsolicited proposals. It also introduces the Integrated Production, Transport, and Distribution Plan (PIPTD), a national planning framework that includes decentralized electrification.

Central to investor confidence is tariff regulation. The study recommends a two-tier national mini grid tariff distinct from the national utility rate. If cost-recovery tariffs exceed what customers can afford, subsidies would bridge the gap—striking a balance between viability and affordability. This flexible approach could make mini grid investments more bankable while ensuring services remain accessible to the rural poor.

Overcoming Financial and Operational Barriers

The study also assessed the financial landscape. A database of 70 financial institutions, ranging from microfinance groups to impact investors was compiled, but interviews revealed deep concerns about Niger’s political and economic risks, particularly after the July 2023 coup. To mitigate this, the study proposes a tailored financing package that includes pre-investment grants, capital subsidies, and political risk guarantees from agencies like MIGA. Complementary measures, such as support for productive uses of energy and improved regulatory clarity, are seen as essential.

Importantly, the report highlights the untapped potential of partnerships between local and international firms. Interviews with project developers revealed that while local companies often face knowledge and capital constraints, international developers bring technical expertise and financial muscle. Collaborations between the two could foster stronger, more resilient project execution and long-term capacity development.

Empowering Communities and Building Skills

Community engagement emerged as a non-negotiable success factor. The report stresses that communities must be involved from the earliest planning stages, not only to gain acceptance but also to ensure long-term use and sustainability of the mini grids. Special attention is given to gender inclusion, urging developers to support women’s cooperatives and businesses that rely on electricity. Local labor mobilization and result-based grant incentives tied to community involvement are also recommended.

Finally, a major output of the assessment is a comprehensive training program for three target groups: government officials, private sector actors, and financial institutions. These programs cover technical, financial, and regulatory topics tailored to each sector. Stakeholders expressed strong preference for hands-on, in-person training that fosters cross-sector collaboration and knowledge exchange.

As Niger puts this comprehensive strategy into action with the Mini Grid Atlas guiding project selection and the forthcoming electricity code shaping the regulatory landscape—the country is setting a precedent. This model not only addresses Niger’s electrification challenges but also offers a scalable solution for energy access across Africa. The lessons learned here may well power the continent’s future.