Uptick in off-grid energy investments

Investments in the off-grid energy sector are on the rise in emerging markets – including Africa. That’s because it makes zero sense to try to put everyone on a grid in Africa while off-grid prices are starting to improve, says Romain Py, head of transactions at African Infrastructure Investment Managers (AIIM). “A single solution of centralised power will not work, but it is a question of what makes sense for each country.” According to Benjamin Attia, a research analyst at Wood Mackenzie Power & Renewables and an African solar PV markets expert, corporate-level investment flowing into the space amounts
to about $2 billion. “It is becoming clear that strategic investors are making longer-term plans and there is an increasing amount of money being spent on off- grid solutions with a focus on customer-centric solutions.” Both Py and Attia agree one of the biggest challenges in Africa is not the availability or even interest in projects, but that there is not enough closing of these projects. “Very few countries in Africa have been able to do what South Africa has done which is close ten to 12 large projects in relatively short periods of time. Investors are not interested in one project every ten years,” he said.