Zambian government and partners unveil new financial mechanism to accelerate energy access through mini-grids

Press release

11 Apr 2024

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Lusaka, Zambia – 11 April 2024: In support of His Excellency President Hakainde Hichilema’s decision to accelerate deployment of mini-grids through the 1000 Mini-grid Initiative, the Zambian government have today unveiled a new financial mechanism to support mini-grid developers: the Demand Stimulation Incentive. Spearheaded by The Rockefeller Foundation with support from the Global Alliance for People and Planet (GEAPP), and Sustainable Energy for All (SEforALL), this first-of-its-kind, results-based incentive will help overcome the barriers for mini-grid deployment, increasing energy access to Zambians.

The Demand Stimulation Incentive will support rural development by powering productive uses of energy in communities currently lacking access to reliable electricity. Designed as a grant-based subsidy, the incentive steers mini-grid developers to rapidly connect small businesses and public institutions, spurring income generation and economic activity in these communities.

In its first phase, the incentive will target mini-grids deployments across 100 priority sites, which will positively impact the livelihoods of 30,000 rural Zambians and the welfare of over 100,000 Zambians by electrifying schools, hospitals, and other community institutions. Increasing access to reliable, affordable, and modern energy remains a key priority for the Government of Zambia and a critical enabler to bolster economic development in the country.

The launch of the 1000 Mini-grid Initiative at COP28 marked a significant milestone in Zambia’s pursuit of sustainable development and energy accessibility. With support from The Rockefeller Foundation, GEAPP, and SEforALL, the 1000 Mini-grid Initiative, which seeks to address energy accessibility challenges and stimulate growth in crucial sectors, including agriculture, energy, and rural development, ultimately aims to reach one million people over the coming years.

Supporting quotes:

“Zambia is committed to transforming its energy landscape, and the 1000 Mini-grid Initiative provides a strong foundation to provide reliable, affordable and modern energy to rural communities. This is a collaborative endeavour with the support of our valued partners, The Rockefeller Foundation, GEAPP and SEforALL. I look forward to the transformation that this ground-breaking initiative represents including economic development, job creation, better education and healthcare.”

His Excellency Hakainde Hichilema, President of the Republic of Zambia

“Zambia's leading the way with its vision to accelerate mini-grid electrification in the communities that have long gone without reliable, affordable energy. Realizing that vision will require collaboration and coordination among many stakeholders including public institutions, private entities, philanthropies, donors, investors, and communities themselves. The Rockefeller Foundation is proud to support this innovative, ambitious approach to unleash the power of Distributed Renewable Energy to advance opportunity even as we slow the climate crisis.”

Dr. Rajiv J. Shah, President of The Rockefeller Foundation

“This 1000 Mini-grid Initiative is yet another example of Zambia’s commitment to the Sustainable Development Goals and in particular SDG7. The Demand Stimulation Incentive that we have unveiled today is an immediate solution which we believe will help unlock the mini-grid market in Zambia. We believe that this incentive will greatly accelerate the closing of current energy access gaps which will go a long way in improving Zambia’s energy security and power economic growth, creating new possibilities for millions of Zambians.”

Damilola Ogunbiyi, CEO and Special Representative of the UN Secretary-General for Sustainable Energy for All, and Co-Chair of UN-Energy

“GEAPP is proud to support H.E. President Hichilema’s vision to build a more resilient, sustainable, and equitable energy system, deploying Distributed Renewable Energy (DRE) systems to enhance new and improved access in communities where they are the fastest and least cost electrification solution. The deployment of this Demand Stimulation Incentive will support mini-grid developers to work with communities to boost the productive use of energy and incentivize public institutions to connect to sustainable electricity.”

Joseph Nganga, Interim CEO at the Global Energy Alliance for People and Planet (GEAPP)

About GEAPP

The Global Energy Alliance for People and Planet (GEAPP) is an alliance of philanthropy, governments, technology, policy, and financing partners. Our common mission is to enable emerging and developed economies to shift to a clean energy, pro-growth model that accelerates universal energy access and inclusive economic growth while supporting the global community to meet critical climate goals during the next decade. As an Alliance, we aim to reduce 4 gigatons of future carbon emissions, expand clean energy access to one billion people, and enable 150 million new jobs. With philanthropic partners the IKEA Foundation, The Rockefeller Foundation and Bezos Earth Fund, GEAPP works to build the enabling environment, capacity, and market conditions for private sector solutions, catalyze new business models through innovation and entrepreneurship, and deploy high-risk capital to encourage private sector solutions and assist just transition solutions. For more information, please visit www.energyalliance.org and follow us on Twitter at @EnergyAlliance.

About The Rockefeller Foundation

The Rockefeller Foundation is a pioneering philanthropy built on collaborative partnerships at the frontiers of science, technology, and innovation that enable individuals, families, and communities to flourish. We make big bets to promote the well-being of humanity. Today, we are focused on advancing human opportunity and reversing the climate crisis by transforming systems in food, health, energy, and finance. For more information, sign up for our newsletter at rockefellerfoundation.org and follow us on X @RockefellerFdn.

About Sustainable Energy for All (SEforALL)

Sustainable Energy for All (SEforALL) is an international organization that works in partnership with the United Nations and leaders in government, the private sector, financial institutions, civil society and philanthropies to drive faster action towards the achievement of Sustainable Development Goal 7 (SDG7) – access to affordable, reliable, sustainable and modern energy for all by 2030 – in line with the Paris Agreement on climate. We work to ensure a clean energy transition that leaves no one behind and brings new opportunities for everyone to fulfill their potential.

For more information visit www.seforall.org, you can also follow us on Twitter, LinkedIn and Instagram.

Media Contacts:

Ashley Chang, The Rockefeller Foundation, media@rockfound.org
Eric Gay, Global Energy Alliance for People and Planet (GEAPP), eric.gay@energyalliance.org
Sherry Kennedy, Sustainable Energy for All (SEforALL), sherry.kennedy@seforall.org

Guest blog: How Zambia plans to deliver new electricity to millions

By Lloyd Ngo, Electrification Advisor, Electricity Services Access Project, Zambia Ministry of Energy

SDG7 News

13 Nov 2019

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This is an exciting time for Zambia’s electricity sector. Roughly one year ago, the Government of Zambia announced plans to develop a National Electrification Program as an integrated approach to electrification that will help the country achieve its Vision 2030 electrification targets.

Advancing rural and urban access

Vision 2030 seeks to increase the rural electricity access rate from the current 4.5 percent to 51 percent by 2030. In urban areas, the target access rate by 2030 is 90 percent compared to the current 67 percent. These are ambitious plans given Zambia’s rapidly growing population and a population density among the lowest in southern Africa.

Hydro currently provides 85 percent of Zambia’s electricity capacity, mostly through large-scale, grid-connected generation. But such reliance on large hydro and grid connections can’t continue if we are going to bring electricity to millions of people living in hard-to-reach rural communities.

Government and industry know this, which is why Vision 2030 envisions the contribution of renewables and alternative energy sources moving from 2 percent to 15 percent of the country’s electricity mix. How can this be realized?

Enter the National Electrification Program. It is a comprehensive roadmap for the electricity sector’s overall development. Through close consultation with all system stakeholders—consumers, development partners, local governments, regulators and energy enterprises, among others—we are defining what needs to happen for us to succeed in meeting Vision 2030 and pushing for even greater ambition with an eye towards Sustainable Development Goal 7 (SDG7) calling for universal clean energy access.

Marking opportunities

Based on stakeholder input and least-cost electrification planning using geo-spatial analysis, we are segmenting the country into areas best served by different services or technologies. Some areas will be identified as suitable for grid expansion or densification while others will be best served by mini-grid or off-grid solutions.

The output from this process is a rollout plan and bankable prospectus that identifies essential investments for public, private, and cooperating partner financing of electrification projects. Our new institutional framework will help de-risk investments. For example, it will ensure those wanting to develop off-grid or mini-grid projects in remote areas don’t have to worry about future grid expansion to these project areas.

A pillar for development

The National Electrification Program is still being developed and is part of a promising trend of Integrated Electrification Pathways emerging in countries across Africa. The support this program has received from the highest levels of government is an indication of how big a priority electricity access has become.

Tellingly, the National Electrification Program is seen as a pillar for achieving the broader development goals of Vision 2030, helping Zambia become a “strong and dynamic middle-income industrial nation that provides opportunities for improving the well-being of all, embodying values of socio economic justice.” (Government of Zambia) and the SDGs.