Energizing Finance: Taking the Pulse 2019 - Madagascar, the Philippines and Uganda

Taking the Pulse 2019 details the energy access financing challenge faced in three countries: Madagascar, the Philippines and Uganda. The report provides crucial insights into how national contexts shape finance flows for electricity and clean cooking access. Each of these countries has its own unique set of energy needs, existing infrastructure, policies and regulations.

The report finds that USD 6.4 billion in aggregate investment is needed by 2030 in the three focus countries to deliver the mini-grid, stand-alone solar and improved cookstove solutions that will enable Sustainable Development Goal 7 (SDG7).

The report also probes what kind of capital this is, providing estimates of the different grant, equity, debt and affordability gap financing that will be necessary to deliver these energy access solutions.

See also: Energizing Finance series

This report is part of the series:  Energizing Finance

Madagascar Country Study

Plans by the Government of Madagascar to expand electricity access have been constrained in recent years by slow expansion of the electricity grid. While grid service remains largely unchanged since 2010 at 11 percent, stand-alone solar for households has begun to transform the electricity market in the country, providing electricity to almost 10 percent of households, which represents almost half of the households with energy access. New grid connections are expected to reach an additional 600,000 households by 2030 (increasing grid access by 2.4 percent).

If Madagascar follows a business as usual (BAU) scenario—allowing markets to continue developing based on current levels of support from the private sector, government agencies and development partners—grid coverage would actually decline to cover 9 percent of households by 2030 since the current pace of grid expansion is not keeping up with population growth.

Madagascar has the largest clean cooking deficit in Africa, with less than 1 percent of households using clean fuels, and a fraction of a percent of households using improved wood or charcoal stoves.

For closing the access gap in Madagascar USD 2.3 billion is required for off-grid electricity and improved cooking solutions.


Philippines Country Study

The Government of the Philippines has made universal electrification a national priority and has an urbanization rate over 50 percent, which helps to explain why it has already achieved nearly 90 per-cent household electrification and universal electrification of all municipalities. Off-grid electrification has been central to accomplishing this since the Philippines’ island geography makes achieving universal electrification through grid extension too costly. As such, mini-grids and stand-alone systems have a critical role to play. While mini-grids in particular have transformed the electricity market in the Philippines, universal access by 2030 will still require acceleration across grid-based and off-grid technologies to keep pace with rapid population growth.

If the Philippines follows a business as usual scenario, allowing markets to continue developing based on current levels of support from government agencies and development partners, grid coverage would remain relatively unchanged by 2030, with 82 percent of households electrified.

For closing the access gap in the Philippines USD 1.8 billion are required for off-grid electricity and improved cooking solutions.

See also: Off-grid solar solutions: The pathway to 100 percent electrification in the Philippines

Uganda Country Study

Uganda has made solid progress in expanding electricity access in recent years, aided by rapid growth in the market for stand-alone household solutions and steady expansion of the electricity grid. When combined, the existing electricity grid, mini-grids, and stand-alone solar currently provide electricity to almost 38 percent of households in Uganda, leaving an access deficit of 62 percent. In looking towards the Sustainable Development Goals (SDG7) target date of universal access129 by 2030, grid expansion will play a significant role in closing the electrification access gap; this report forecasts 4.7 million new grid connections, representing a fourfold increase in annual connections compared to recent connection trends. Uganda currently only has 11 operational mini-grids, servicing approximately 4,000 households. Development of the mini-grid sector has been hampered by an unclear regulatory framework that has limited private sector participation, while public resources have focused on the expansion and densification of the main electricity grid.

Ninety-five percent of all Ugandan households rely on charcoal, wood, or other forms of biomass for their household cooking needs.130 Despite this, ICS use remains extremely low at around 1 percent. The use of clean fuels (such as liquefied petroleum gas (LPG), biogas, and ethanol) also remains under 1 percent. 

For closing the access gap in Uganda USD 2.3 billion are required for off-grid electricity and improved cooking solutions.