Mini-grids: solving rural access to energy in Angola

Angola

As the Angolan government ramps up its rural electrification efforts, solar mini-grids are gaining importance as a viable option for promoting these efforts. Joana Brito Paulo, managing associate at CMS Portugal, discusses the advantages of this approach in Angola and how it can be implemented.

In line with the Angolan Long Term Strategy’s goal of achieving a rural electrification rate of 60% by 2025, the government of Angola has recently approved the guidelines of the National Program for Rural Electrification of Rural Areas, by means of Executive Decree 78/23, of 30 May 2023. The main purpose is to bring electricity to remote areas of the country that still do not have access to the grid and are not expected to be connected for the next 10 years, providing an opportunity for increased renewables-based mini-grids for rural consumers.
Solar mini grids are expected to take an important role in the fulfilment of goals towards the electrification and development of rural areas, and boosting of local economy and sustainable growth.
Grid expansion and connection of households and population to main electricity grids is expensive and faces several constraints in African countries, especially in remote rural areas. Micro and mini-grids are recognised as a cost-effective solution for promoting the development of rural areas, and connecting the surrounding households and businesses to decentralized distribution systems (in UNIDO’s Clean Energy Mini-grid Policy Development Guide).
It is not a coincidence that investment in off-grid solutions is growing in Angola. One great example is the USD 1.95-billion investment announced by Sun Africa, an American sustainable energy developer. The multinational company is installing 200-plus solar cabin systems and 60,000-plus solar home systems in the southern provinces of Cunene, Huíla, Namibe and Cuando Cubango, which will connect an additional ​​827,754 Angolans to electricity. The projects will also include the installation of mini-grids that will provide 220 MW of solar energy, much-needed water purification systems and 286 MWh of battery storage across 64 local communities.
Investors and market players are showing interest in implementing similar projects in Angola. It is therefore likely that greater levels of investment will be needed in the coming years to meet electricity access targets on rural electrification, social and economic development of rural population.
To that end, it would be important to consider the implementation of measures to enable accelerated rural electrification which may include:

(i) Overcoming barriers to financing and conceiving financing solutions adapted to mini grid projects risk profiles;

(ii) Approving a clear regulatory framework for mini-grids projects and a streamlined license approval process;

(iii) Implementing a tariff update to ensure that mini-grids can be financially sustainable and are able to cover operating costs and recover the initial investment.

These are all set as short-term goals in the Rural Electrification Plan guidelines recently approved, which are expected to be put into practice soon.
Much is still to be done, but the good news is that the Angolan government seems committed to creating the necessary conditions to increase rural electrification. Renewable energies, particularly micro and mini-grids, will definitively play an important role in achieving the intended goals.

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