Off-Grid Energy Solutions Present a Three Billion-Dollar Market Opportunity for Investors, New Report Finds
WASHINGTON, March 3, 2016— By 2020, the sales of off-grid solar products in emerging markets are expected to reach $3.1 billion, providing access to improved energy for 99 million households with no access to the grid, according to a new report released today by the World Bank Group and Bloomberg New Energy Finance (BNEF), in collaboration with the Global Off-Grid Lighting Association (GOGLA).
The report, titled Off-Grid Solar Market Trends, tracks the ground-breaking technological advances and innovative business models which have emerged to transform the lives of millions through affordable modern solar energy services. It shows that the off-grid solar industry is booming and a growing wave of development partners and investors are committing significant funds, with a primary focus on pay-as-you-go business models. The report finds that annual investments into the industry have risen to $276 million in 2015, a fifteen-fold increase since 2012. It also shows that 89 million people in Africa and Asia already enjoy improved access to energy by using off-grid solar products.
“The report provides a comprehensive view of the state of one of the most impactful industries in the global economy today,” said Russell Sturm, Global Head of IFC’s Energy Access and World Bank Group’s Lighting Global program. “This is the third in a series produced by the World Bank Group’s Lighting Global Program since the industry’s emergence seven years ago and illustrates how off-grid solar can be a game changer for development as well as a unique business opportunity for the private sector in the energy access space.”
Solar-powered portable lights and home kits offer a safer, cheaper and environmentally friendlier service to the 1.2 billion people who live without access to the power grid and currently spend about $27 billion annually on fuel-based lighting and mobile-phone charging technologies.
“The pay-as-you-go business model combines rapid innovation in solar, batteries and LED lights with the transformative power of mobile communication technology,” said Itamar Orlandi, BNEF’s Head of Applied Research. “This allows new companies to build services, sales and a deep understanding of their customers at an accelerating pace, which in turn is attracting new sources of growth capital into the industry.”
Koen Peters, GOGLA Executive Director, added: “This report marks the success of cooperation between GOGLA, Lighting Global and BNEF in collecting valuable market intelligence. The data and insights this report provides are critical for informing policy makers, investors and other stakeholders to help grow and strengthen our industry, and provide essential information to solar businesses.”
“Achieving the goal of universal access will not come through grid extension alone, so off-grid technologies are vital to achieve our goal. This is why the World Bank Group, through its Lighting Global platform, supports the growth of a sustainable off-grid solar market as a means of increasing access to energy to people for whom the power grid is not a viable option,” said Charles Feinstein, Director, Energy and Extractives Global Practice, World Bank.
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