African Mini-Grids Community of Practice · CoP public-private dialogue among government officials and private mini-grid developers and financiers. The key findings of this meeting

AfricanMini-GridsCommunityofPractice

Meeting4:ReportAbuja,Nigeria

09-11November2018

AMG-CoPMeeting4–MeetingReport

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HighlightsoftheAfricanMini-GridsCommunityofPractice(AMG-CoP)in2018KeyactivitiesoftheAfricanMini-GridsCommunityofPractice(AMG-CoP)in2018includethefollowing:

• The AMG-CoP is growing and now counts 15 member countries: DRC, Kenya, Ghana, Uganda,Zambia, Malawi, Liberia, Namibia, Nigeria, Ethiopia, Tanzania, Zimbabwe, Cote d’Ivoire, SierraLeoneandCameroon.ThenewcountriesareZimbabweandCameroon.

• ThethirdmeetingoftheAMG-CoPwasheldinNairobiinApril2018onthesidelinesoftheAfricanCarbon Forum. Bringing together 34 delegates from 14 countries, the meeting focused on thefinance-related challenges of implementing mini-grids across Africa. The meeting report can beaccessedhere.

• Awebinaron “Mini-Grids for Rural Electrification and Development: Enabling Effective BusinessModelsthroughWell-DesignedPolicies”on19September.Inthiswebinar,expertsfromINENSUS,Engie, RVE.SOL, Helios Infinitas, and AMDA as the industry body, provided an overview of thediversemini-gridspolicy,regulatoryandlegislativeenvironmentsinCentral,Eastern,andWesternAfrica.Therecordingisavailablehere.

• An expert facilitated meeting on the topic mentioned above was hosted with the experts toprovideanopportunityfortheAMG-CoPmemberstointerrogatecomponentsofthepoliciesthatenableeffectivebusinessmodels.Thismeetingwashostedon19September.

• PublicationofarevisedAMG-CoPconceptnote,whichcanbefoundhere.• ThefourthmeetingoftheAMG-CoPwasheldinAbuja,Nigeriafrom09-11November.Themeeting

washostedbytheNigerianRuralElectrificationAgency.Thefocusofthemeetingwasontariffandsubsidy design. This three-day meeting was well attended with over 45 participants from 16countriesonDay1(openday)31participantsonDay2and3.TheworkshopfeaturedthefirstAMGCoP public-private dialogue among government officials and private mini-grid developers andfinanciers.Thekeyfindingsofthismeetingarecapturedinthisreport.

• AsitevisitwasundertakenaspartofthefourthAMG-CoPmeetinginAbuja.ThemembersvisitedacommunityinMinnawhereamini-gridwasinstalledin2015byGVE.Itisasystemof37.5kWandpowers over 340 households as well as supports 10 productive uses of energy at themoment.Moreinformationcanbefoundhere.

• Development of the 2019workplan with input from themembers. Based on demand from themembers,theSecretariathasscaledupambitionfor2019.ThedraftworkplanfortheAMG-CoPisincludedinthisreport.


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SpotlightonNigeria-GhanaBilateralExchange

TheSecretariathas facilitatedabilateralexchangevisitbetweenrepresentativesof theGovernments of Ghana andNigeria. The objectives of the exchange visitwere:• Toexplorethemini-gridpolicyandregulationofeachcountry.• To understand the incentive model applied, particularly related to tariff

subsidiesandthedisbursementsthereof.• Todeterminetheoperationsandmaintenancemodelappliedtomini-grids.• Toexplorethepublicprivateparticipationofthescalingupofmini-gridsin

bothcountries.The first leg of the exchange involved the Government of Nigeria – withrepresentatives from the Rural Electrification Agency (REA), Energy CommissionNigeriaand theNigeriaElectricityRegulatoryCommission (NERC)–visiting theircounterparts in Ghana from 28-31 August 2018. Five officials from Ghana –representatives from theMinistryof EnergyandPetroleum,EnergyCommissionandGEDAP–travelledtoNigeriafrom16-19October2018forthesecondlegoftheexchange.Thisbilateralexchangevisithasallowedforadeepengagementbetweenthetwocountries on public and private sector ledmodels formini-grid development. Amarket levy inGhana that is used to fundelectrificationprojects in the countryhasinspiredofficialsfromNigeriatolookintoasimilarmarketmechanismtoraisefunds for mini-grids. REA are currently working with NERC to determine theviabilityofsuchamarketlevyinNigeria.Ghana’selectrificationstrategyiscontextspecificandaddressesneedsontheground– for instance insomecommunitiessolarhomesystemsareprioritisedovermini-gridswhile inothers,mini-gridsareused to drive energy access. The Ghanaian counterparts have learnt about thecompetitiveprocurementprocessthatREAhaspilotedin2018.ProductiveuseofenergyisbeinggivenmoreconsiderationintheprivatesectorledmodelinNigeriathan in Ghana at present to stimulate demand and grow the local economy toimprovetheviabilityofbusinessmodels.Moreinformationonthisexchangevisitiscontainedinthisreportandcanalsobefoundhere.


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TableofContents

1. BACKGROUNDANDOBJECTIVES........................................................................................................1

2. KEYOUTCOMESANDLESSONS...........................................................................................................1

3. MEETINGSESSIONS............................................................................................................................2DAY1:SESSIONONSCENESETTINGANDCASESTUDYDISCUSSION............................................................................4DAY1:PUBLICPRIVATEANDPHILANTHROPICVOICES:LESSONSLEARNTFROMEXISTINGRESULTSBASEDANDINCENTIVEPROGRAMMES..................................................................................................................................................4DAY1:LESSONSLEARNTFROMDONORSUPPORTEDMINI-GRIDEFFORTSONSMARTINCENTIVES..................................5DAY2:REFLECTIONSANDDISCUSSIONSFROMDAY1..............................................................................................6DAY2:SURVEYRESULTS.....................................................................................................................................6DAY2:REPORTBACKFROMTHEPEER-TO-PEEREXCHANGEVISIT...............................................................................7DAY2:DEEPDIVECASESTUDY...........................................................................................................................8DAY2:WORKPLANNINGBREAKOUT....................................................................................................................8

4. DRAFTWORKPLANFORJAN-JUNE2019...........................................................................................11

5. ANNEXES.........................................................................................................................................13ANNEX1–AMG-COPPROGRAMME.................................................................................................................13ANNEX2–PRIORITYAREAS–IDEASPUTFORWARD..............................................................................................13ANNEX3–DETAILEDMEETINGNOTES...............................................................................................................13ANNEX4–MEETINGPARTICIPANTS...................................................................................................................13


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1. BackgroundandObjectivesOver600millionpeopleinAfricalackaccesstoelectricity.Thisenergypovertyimposesasignificantsocialandeconomicburdenontocommunities,affectingtheiraccesstoeducationandhealthservices,aswellasadverselyimpactingeconomicproductivity.Mini-gridsofferanopportunitytofillthissupplygap,bringingelectricitytoareasunderservedornotservedatallbythecentralizedgrid.Inmanyplaces,mini-gridsoffertheonlyreliableelectrificationoption.Mini-gridsbasedonrenewableenergysourcescanassistcountriesto reach their overall development goals, energy-sector objectives and Nationally DeterminedContributions (NDCs) under the Paris Climate Agreement. However, despite their tremendous potential,uptake of mini-grids is slow. High investment costs and risks coupled with largely unproven businessmodelshasresultedintheslowdevelopmentofthemini-gridsectorinmanypartsofAfrica.In response to this challenge theAfricanMini-Grids Community of Practice (AMG-CoP)was convened inJune2017attheAfricaCarbonForuminCotonou,Benintoprovideapeer-to-peerworkinggroupforpublicsectorofficialsandtechnocratscommittedtoscalingupmini-gridpoliciesandsystems intheircountries.TheAMG-CoPisaninitiativeoftheAfricanLEDSPartnership(AfLP)supportedbytheLEDSGPEnergyandFinanceWorkingGroups.ThefourthmeetingoftheAMG-CoPwasheldinAbuja,Nigeria.Thefocusofthemeetingwasontariffandsubsidydesign.Theobjectivesforthemeetingwereto:

• Exploretheviabilitygapbetweentariffandsubsidy• Determine how to set tariffs based on the different forms of subsidies available and the timing

thereof.• Createmutual understanding of the approaches taken by eachmember country with regard to

mini-gridimplementation.• Collaborativelydevelopaworkplan for2019 inacollaborativemannerso that it responds to the

needsofthemembers.

2. KeyOutcomesandLessonsTheoverallfeedbackwaspositive,withparticipantsexpressingappreciationforthefactthatthismeetingwasheldoveralongerdurationthanthelastthreein-personmeetings.Thekeylessonsemergingfromthemeetingare:

• Despitethefirminguporreviewingofthemini-grids/off-gridregulatoryframeworkinmanyAfricancountries,lengthyprocessesstillcontinuetodeterinvestmentsinthatparticularsector.Licensingprocesses are complex and lengthy, and in some cases require environmental and social impactassessmentstudiestobeundertaken.

• Uncertainty over the continued validity of Power Purchase Agreements in the event of regimechangecontinuestounderminetheconfidenceofmanyinvestors.


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• The timing of subsidies is crucial for a viable business model and yet in many instances, thedisbursementof the subsidies can takeup to threeyears.Thisdetersdevelopers fromventuringintopoorcommunitieswhereelectricityismostneededforsocio-economicdevelopment.

• GISisincreasinglybeingusedtodemarcateandprioritisesitesforelectrification.• Smartincentivessuchasdutywaiversonimportedhardwareandmaterialand/orreducedvalues-

addedtaxarerequiredtoboostthemini-gridssector.• Across-subsidisationmodelofcustomersisrequired,especiallyforastandardtariffregime.• Insomeinstances,government-ownedandoperatedmini-gridsarebeingtakenoverbytheprivate

sectorbecauseofpoormaintenanceorbecausetheyarenolongerfunctional.• Accesstofinance,especiallyfromlocalfinancialinstitutions,remainsakeychallenge.• Thereisaneedtodevelopthemini-gridssectorinawaythatdoesnotdistortoraffectthemarket

intermsoffuturedeploymentofrenewableenergy.Thekeyoutcomesofthemeetinghingeonthetheme,whichwastariffandsubsidydesign,are:

• Thereareseveraltariffregimes,notably,regressive(generallyusedtogrowparticular industries),progressive(lifeline),power-based(flatfeestructure),standardandflexible.

• Coupling electricity as a service with the provision of appliances (appliance finance), i.e. a feemodel,isincreasinglybeingusedbecauseofitsabilitytoactivatedemandandgrowconsumption.Thecostsoftheapplianceandtheenergyconsumedarebundled.

• There is an increasing outlook at communities that haveongoing economic activities to tap intoproductiveuseasawaytoanchorusers.Thishelpsmini-gridsintermsofsupply,tariffsandcross-subsidisation.

• Siteassessmentscansignificantlylowerthecoststothedeveloperwhichultimatelyreflectsinthetariffsset.

3. MeetingSessionsInresponsetooneoftheneedsidentifiedatthethirdmeetinginNairobi,themeetinginAbujawaslongerindurationtoallowfordeeperdiscussions.Itwasa3-daymeetingstructuredasfollows:Day1 Openpublicprivatedialogue(Friday,09Nov)Day2

ClosedCoPmeetingwithCoPmembers-focusonsubsidydesignandbusinessmodelsupportformini-grids(Saturday,10Nov)

Day3 SiteVisit(Sunday,11Nov)The meeting was well attended with over 45 participants from 16 countries on Day 1. There were 12Africancountriesrepresentedatthemeeting.Theopendaysolicitedinterestfromvariousstakeholders–internationalandlocal.Thefollowingorganisationswererepresented:

• AfricaSustainabilityinstitute(Kenya)• AfricanDevelopmentBank• AllOn(Nigeria)


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• AfricanMini-GridsDeveloperAssociation(Nigeria)• CentreforRenewableEnergyandActiononClimateChange(Nigeria)• CommunityEnergyAfrican(Nigeria)• CommunityResearchandDevelopmentCentre(Nigeria)• CrossBoundaryEnergy• DepartmentofEnergy(Liberia)• EnergyCommissionofNigeria• EthioResourceGroup(Ethiopia)• GIZ(Nigeria)• HavenhillSynergy(Nigeria)• InstituteofResearchinNewEnergies(Nigeria)• KwameNkrumahUniversityofScienceandTechnology(Ghana)• MandulisEnergy(Uganda)• MinistryofEnergy(SierraLeone)• MinistryofEnvironment,UrbanSanitation,andSustainableDevelopment(Coted’Ivoire)• NamibianEnergyInstitute• NigeriaPowerSectorProgram(NPSP),PowerAfricaContractor• PowerGen• RuralElectrificationAgency(Nigeria)• RuralElectrificationAgency(Uganda)• RuralElectrificationAgency(Zambia)• SaoEnergy(Nigeria)• SouthSouthNorth(Ethiopia)• SterlingBank(Nigeria)• TEPNG(Nigeria)• UNFoundation/Mini-GridsPartnership• WorldBank:ESMAP

Day2wasaclosedmeetingforonlytheAMG-CoPmembers.Therewere31participantsfrom16countries.TheparticipantbaseconsistedlargelyofofficialsfromtheMinistriesofEnergy,andofRuralElectrification.Day3,wasasitevisittoamini-gridinstallationinMinna,whereparticipantswereofferedtheopportunityto interrogatethe localdeveloper’srepresentativeonthemini-gridsysteminstalled.Pleaseseethepagehereformoreinformationonthesitevisit.Thefollowingsectionscapturethekeysessionsofthemeetingandhighlightpertinentpoints.


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Day1:SessiononSceneSettingandCaseStudyDiscussionThefollowingpointsweremadeduringMicahMelnyk’s(ElectricCapitalManagement)presentationonthecasestudyconductedbytheFinanceWorkingGroup:

• Tariffandsubsidyaretheflipsidesofthesamecoin.• Therearetwoformsofsubsidy,eitherproducerorconsumersubsidy.• Governmentstraditionallyapproachtariffsfromtheperspectiveofaffordabilityandequity.• Thereareseveraltariffregimes,notably,regressive(generallyusedtogrowparticular industries),

progressive(lifeline),power-based(flatfeestructure),standardandflexible.• Coupling electricity as a service with the provision of appliances (appliance finance), i.e., a fee

model, is increasinglybeingusedasthismodelhelpstoactivatedemandandgrowconsumption.Thecostofapplianceandthecostofenergyconsumedarebundled.

• Subsidisationcaneitherhappenatthegeneration,distributionoroperationlevel.• OperationExpenditure(OPEX)subsidiesimprovelong-termsustainabilityofsystems.• Connection subsidies tend to favour dense communities. This is often preferred by developers

because of the potential returns and also because Results-Based Financing (RBF) requires lessdocumentation.

• AgoodInternalRateofReturn(IRR)isdeterminedtobebetween15-20%.However,thisiscontext-specificandpredicatedonvariousprevailingelements.

• Generallydevelopersneedbankguaranteestoaccessfinance.• Distribution costs coveredby theREA results inaCapital Expenditure (CAPEX) reductionof40%,

which further attracts private sector investment in the mini-grids sector. Nigeria is currentlyimplementing this model in communities whereby REA covers the distribution costs and thedeveloper covers the generation and operation costs. This is largely viewed as a viable form ofsubsidy.However,apoorlyconstructeddistributionnetworkcanhavesignificantnegative impactonthedeveloper’sabilitytoreachthecustomerwithareliableservice.

• Astowhethersubsidiesorconcessionary loansworkbetterfordevelopers, itappearsthatRBFispreferred.

Thesessionwasconcludedwithanopencall formembersoftheAMG-CoPtoco-authororcontributetothe case study. Itwas alsomentioned that the linkage between tax exemption and subsidies should befurtherexploredasakeytopicinthefuture.

Day 1: Public Private and Philanthropic Voices: Lessons Learnt from Existing ResultsBasedandIncentiveProgrammesTim Reber, from the LEDS GP, facilitated this session and the objective was to draw lessons fromprogrammesontheground.Thekeypointsfromthispaneldiscussioninclude:

• To achieve SDG 7, subsidies are required. For this nascent sector, subsidies play a key role. Asbusinessmodelsneedtodeliverimpactwhilstyieldingfinancialreturns,denseclusterofcustomersbecome theprimarymarket. In thosedense clusters, productiveuseof energy generally alreadyexists,orcaneasilybeactivated.


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• Asthemarketmatures,developerswillmoveawayfromsubsidiestomorecommercialmodels.• Therearepoorcommunitieswherebyitismorefinanciallyviabletobuildamini-gridforproductive

usewhilsthouseholdsareprovidedwithSolarHomeSystems(SHS).Thiskeepsthebusinessmodelviable.

• There isa significantneed toboostCAPEXsubsidieson thecontinent inorder togrow themini-gridssector.

• In order to establish the opportunity for productive use, before a development goes ahead,developers generally go into the target community to assess the status quo and thereafterdetermine the viable opportunities based on the community’s needs and existing forms oflivelihoods etc. Some develop relationshipswith the communities and nurture entrepreneurshipskills.Developersareincreasinglyprovidingappliancefinancetoactivatedemandforenergy.

• A productive use could consume as much power as 100 households in the community. It istherefore important to focus on productive use in order to improve the viability of businessmodels.

• The order of magnitude for productive energy use varies significantly based on the prevailingactivities.For instance,coldstorageconsumesroughly5kWtoserve1000 families.Toserve thesamenumberoffamiliesinanagriculturalcommunitywhoseproductiveuseismillingrequires50-100kW.

Day1:LessonsLearntfromDonorSupportedMini-GridEffortsonSmartIncentivesSession moderator Dr Victor Osu asked several donor representatives to interrogate their findings andreflectonlessonslearnt.Thefollowingpointswerementioned:

• ThePowerAfricaprogrammeinNigeriahascommencedinApril2018andwillrunfor5years.Theobjective of the programme is to realise 10,000MWnew generation capacity through 3millionconnectionsforgridandoff-gridsector.Thefourpillarsoftheprogrammeare:i)increasedprivatesector involvement; ii) improvedoff-gridconnections; iii) improvedenablingenvironment;andiv)greaterenergysectorliquidity.

• GIZNigeriahasprovidedbothtechnicalandfinancialassistancetotheGovernmentofNigeria.Theyhavesupportedtheestablishmentanenablingframework,morespecificallytoREAtodevelopandimplement operational guidelines. They have created a database to determine sites to beprioritised for electrification. GIZ has also supported the private sector to facilitate access tofinance.Theholisticapproachinsupportingactorsalongthevaluechainhasbeensuccessfulthusfar.Aclosepartnershipwiththeprivatesectorhascontributedtoprogressingprojects.

• According to GIZ, the NESP programme should have hadmore of a focus on access to finance,especiallyrelatingtolocalbanks.Insteadoffocusingonelectrificationmodelling,theyshouldhaveused GIS to focus on data collection and management. The Nigerian Energy Support Program(NESP)shouldhavemoreofafocusondigitaltechnologiestoreduceCAPEXandOPEX.

• TheWorld Bank is currently working on the Energy SectorManagement Assistance Programme(ESMAP),whichwill be launched in the near future in Nigeria. There is room for top-down andbottom-upapproachtoincentivisemini-gridsinNigeria.Thepremiseoftheprogrammeistobuildon an existing evidence base or proven concept to attract large investments. TheWorld Bank isworkingtowardsimprovingtheeaseofdoingbusinessinNigeria.


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• TheAfDBusedtofocusonlarge-scaleinvestmentsupwardsof$10million,however,therearefewestablishedmini-gridscompanies thatcanabsorbsuch fudsduring the timespecified.Theyhavenow, therefore, created a new facility that lends less than $1 million to Independent PowerProducers(IPPs).

Thispaneldiscussionwasfollowedbyasmallgroupdiscussion.

Day2:ReflectionsandDiscussionsfromDay1AtthebeginningofDay2,theparticipantswereaskedtoreflectonthekeylearningsemergingfromDay1andtosharethosewithinasmallgroup.Thefollowingemerged:

• Theviabilityofmini-gridsshouldnotbe focusedentirelyon financial returnsbutshould factor inthenon-monetarybenefits and the socio-economicpotential that canbeunlockedasa resultofenergyaccess.

• Itisimportanttoworkwithlocalfinancialinstitutionstomoveawayfromgrants.• Developmentbanksare increasingly getting involved in financingmini-grids,howeverat a rather

slow pace. For instance in Nigeria, well-established developers can get interest rates atapproximately9%whilecommercialbanksoffer15-17%.Evenat9%,itisnotattractiveenoughtostimulatethesector.

• Productiveuseiskeyinthebusinessmodelofamini-grid.• Fear around the arrival of themain centralised grid is not a real concern for now amongst the

members. There are ways to manage the risk by working with DisCo’s to understand theirexpansionplanforthenext10years–thisisawayofde-riskinginvestments.

• ThereareconcernsaboutpaymentguaranteesandgovernmentnotadheringtoPPAsbecauseoftheinfluenceofpoliticsandgovernments.

Day2:SurveyResultsThissessionwaspresentedbyAlexiaKellyfromtheLEDSGPFinanceWorkingGroupandwasfocusedonaninvestors’globalsurveythatwasundertaken.Thekeyfindingsofthesurveyarecapturedbelow:

• Therearethreemainchallengesthatarefacedtoday:o thelackofsubsidiesinconcessionaryfunding;o politicaluncertainty–policiesneedtomatchthemarket.Politicalstabilitydoesnotequate

to policies that do not change, but rather to flexibility and predictability in the policyframeworkgoverningmini-grids;and

o Investmentreadychallenge.• Thedebtdealsgoingintothemarketatpresentareverysmall.• As most mini-grid companies are fairly new in the landscape and they are not considered as

seasonedentrepreneurswithprovenbusinessmodels,theyfacemanychallengesinaccessingearlystageinvestment.Asinvestorsaredrivenbyhighprofitability,thebottomlineiskeyandthesocialimpactisconsideredsecondary.


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• Fordeveloperstobecomemoreattractivetodebtfinanciers,theyneedtocashflowpositive.Mostdevelopersareoperatingatlessthan50%capacityutilisationoftheirsystems,whichimpactstheircash flow. Thosewho are doing relativelywell havemanaged this because they have profitablebusinesseswhichtheyusetosecureloansformini-griddevelopments.

• Mostdeveloperspreferequity.• Echoingthepointfromthesurveyrelatingtolimiteddealflowsfromlocalfinancial institutions,a

participant from Nigeria mentioned that local banks have commenced capacity-building on duediligenceandmini-griddevelopmenttraining.

• Thereisadeclinecurveinthecostofmini-gridconnectioncostswhilethecosttoconnecttothemaingridhasincreased.

• ItisestimatedthatgridextensioncostsbetweenUSD15,000-23,000perkilometre.

Day2:Reportbackfromthepeer-to-peerexchangevisitThegovernmentofficialsfromGhanaandNigeriaundertookanexchangevisit,whichwasfacilitatedbytheAfLP.Theobjectivesoftheexchangevisitare:

• Toexplorethemini-gridpolicyandregulationofeachcountry.• To understand the incentive model applied, particularly related to tariff subsidies and the

disbursementsthereof.• Todeterminetheoperationsandmaintenancemodelappliedtomini-grids.• Toexplorethepublicprivateparticipationofthescalingupofmini-gridsinbothcountries.

ThefirstlegoftheexchangewastheGovernmentofNigeriavisitingtheircounterpartsinGhanafrom28-31August 2018. Four officials from theRural ElectrificationAgency, EnergyCommissionNigeria and theNigeriaElectricityRegulatoryCommissionwereinvolvedintheexchangevisit.TheywerehostedinGhanaby a team consisting of officials from the Ministry of Energy and Petroleum, Energy Commission andGEDAP.The second leg of the exchangewas undertaken by five officials fromGhana from 16-19October. Theywere officials from the Ministry of Energy and Petroleum, Energy Commission and GEDAP. They werehosted at the Rural ElectrificationAgency inNigeria andmetwith officials from the Rural ElectrificationFund, theNigeria Energy SupportProgramme (NESP),AfricanMini-GridsDeveloperAssociation (Nigerianchapter)andtheNigeriaElectricityRegulatoryCommission.At themeeting, a representative fromGhanaandNigeriawhowere involvedof theexchangevisitwereeachaskedtoreportback.Thefollowingpointscapturethemainfindings:

• TheelectrificationmodeladoptedinGhanaandNigeriaaresignificantlydifferent–i.e.apublic-ledvsaprivate-ledmodelaswellasstandardvsflexibleandcost-reflectivetariff.

• AmarketlevyinGhanaisbeingusedtofundtheirelectrificationprojects.NigeriaisworkingwithNERCtodeterminetheviabilityofamarketlevytoraisefundsforenergyaccessprojectinNigeria.

• Througharobustandstrategicroadmapandplan,Ghanahasprioritisedmini-gridsandsolarhomesystemstodriveenergyaccess.


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• Splitmetersmitigateagainsttheriskoftheft.• In-depthpeer-to-peermodelsuchasanexchangevisitisbeneficialtoprogressinglearningonakey

topic.• TheMinistryofEnergyisatthehelmofcoordinatingmanysectors,includingtransportandpower,

bycollaboratingwiththerelevantministries.Thissynergyandcoordinationhasenabledapublic-sectorledmodelinGhana.ThislevelofcoordinationamongministriesislimitedinNigeria,whichhampersthecreationofanenablingenvironment.

• Theconceptofanin-depthpeer-to-peerexchangevisitwasseededatthelastmeetinginNairobiasaresultofthestarkdifferencesinGhanaandNigeria’smodelforboostingthemini-gridssector.

Day2:DeepDiveCaseStudyThis sessionwas facilitatedbyMicahMelnyk fromElectricCapitalManagementandentailedanexercisefocused on tariff setting. Micah presented a fictitious case study and provided figures in terms ofpopulationdensity,economicactivitiesandgrowth,formsoflivelihoodsetc.TheparticipantsthenformedsmallgroupsandwereaskedtoroleplayanofficialattheRuralElectrificationAgencywhohasbeentaskedwithsettinguptariffs foramini-griddevelopment.Thisexercisewasuseful ingroundingthe informationpresented during the course of the meeting. Through this exercise, the members were asked to thinkthroughallthedifferentaspectsthatneedtobefactoredindeterminingtariffs.

Day2:WorkPlanningBreakoutFor the workplan session, to allow every member to be given the opportunity to contribute to theworkplan, therewere five stations set up in the roomwith each representing one of the priority areasestablishedattheNairobimeeting.Theseare:

• FosteringAfricanleadership• Buildingpoliticalmomentum• Developingamini-gridfinancingecosystem• Developingandcollatinganalyticaltoolsandresources• Implementingpilotprojects

Therewere15minutesslotsprovidedafterwhichmemberswererequestedtorotatetoanotherstation.Therewasonehoursetasideforthisexerciseafterwhicheverystationleadreportedbacktotheteam.Attheendoftheday,memberswereaskedtovoteonwhichconcepttotakeforwardundereachpriority.Itwasmadeclearthatwemaynotbeabletomeetexpectationsbecauseofcapacityandbudgetconstraints.Thesectionbelowcapturestheprioritiesidentifiedineachpriorityarea.ThefulllistofallprioritiesbroughtforwardbythegroupcanbefoundinAnnex2.


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Developingamini-gridfinancingecosystem• Deepdivefinanceworkshop(s)withlocalandinternationalfinancialplayersonmini-gridfinance.

o HelplocalbanksandfinancinginstitutionsbetterunderstandthecurrentstateofmicrogridbusinessesandidentifykeyinterventionsandsolutionstohelpunlocklocalcapitalacrosskeyCoPmembercountries

• Peertopeerexchangeandengagementonmini-gridfinance(banks,governments,privatesector,

MDBsandDFIs).

FosteringAfricanleadership• Producespotlightsonbestpractices,champions,showcasechampions**• Peer-to-peerlearningandexchangevisits**• Establishcentersofexcellenceorinnovation/incubationhubs**Implementingpilotprojects• Pilot a project on the standardization of mini-grid hardware across all CoP countries to attract

developerso Feasibility study/survey on the appetite of developers to work with standardized

hardware/equipmentinAMG-CoPcountrieso Pilotprojectonstandardizationofhardware/equipmentinAMG-CoPcountries

• Documentingsuccessstoriesonproductiveuse

o Lessonslearntandsuccessstoriesonproductiveusebasedoneconomicactivitiesandlivelihoodsarecurated

o KnowledgeproductonproductiveuseinAfricancountrieso Updatesontheknowledgeproduct

Developingandcollatinganalyticaltoolsandresources• DevelopToolRoadmap/Guidebook

o Developasortofroadmaporguidebookthatspellsoutwhichtoolsdowhat,whatdatagoesinandcomesout,andwhichtoolstouseduringdifferentstagesofprogram/projectdevelopment

o Secondarygoalistohelpensureconsistencyintools(andtheirinputs/outputs)thatarebeingusedacrossallstakeholders(e.g.regulators,developersandfinanciersmightallbeusingdifferenttoolstoevaluateprojectfinance–thiscanleadtoconfusion)

o Guidingquestion:Whichmetricdoyouwanttolookat?→Roadmappointstotheavailabletoolsthatwillhelpyougetthere.

o Frameworkforhowtoolsfittogethertopaintbigpicture–i.e.howdoallthetoolsfittogether/flowintooneanotheracrossallaspectsofMG’s?

o Stages/metricstoaddress:planning,tariffs,subsidies,projectfinance,M&V,BD,etc.• DevelopCommonFrameworkforProjectData

o Howtoensureconsistentdataiscollectedandreportedacrossprojects.Alotofdifferentproject


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reportingtoolsoutthere,socanwehelpstandardizesomeelements?o FacilitatecommonanalysesofprojectdataacrossdifferentprojectsandacrossCoPcountries.o Alotofworkinthisspacealready→linkwithexistingefforts(e.g.GMGHelpDesk,Minigrid

Partnership,QAF,etc.)Buildingpoliticalmomentum

• Facilitatelearningexchangeo Politicians and government officials that are not directly involved in the planning and

implementationofmini-grids tovisitelectrificationproject inothercountries tohighlightthepotentialofmini-grids.

• Createamini-gridecosystemo Mapwhatisgoingoninthemini-gridslandscapeincludingresults,economics,impactsand

policies to allowmember countries to “catch up” with countries that have achieved farmoreprogress.Thiswouldprovidetheevidencebasesorequiredto furthermini-grids inmanymembercountries.

• Developamini-gridpolicyframeworkormodelframeworko Thiswouldprovideabaseforlegislationinmembercountries.

Tothebestofourabilityandusingtheresourcesavailable,theSecretariatandtheWorkingGroupshaveaccommodatedthepriorities identifiedabove.Someofthemhavebeen included inourworkplan,whichcanbefoundinthenextsection.


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4. DraftWorkplanforJan-June2019Activity Jan Feb Mar Apr May JunLocalfinancialinstitutionmini-gridtraining-contingentonresources Hostonein-personmeetinginQ2of2019.ThethemeofthemeetingisTBD-contingentonresources Developknowledgeproductonproductiveuseanddemandstimulation Conductcommunitymini-gridownershippiloteffort,includingastudytourtothePhilippinesandUSAonthemodusoperandiofenergyco-ops-–contingentonresources

ProvidetheopportunityforchampionmemberstoattendtheWorldBankMini-GridActionLearningLabinMarch2019,countryTBD--contingentonresources

Hosteventsatlargermeetings/gatheringstoraisetheprofileoftheAMG-CoP-contingentonresources MaintainWhatsAppandLinkedInGroups. ActivelyreachouttocountriescurrentlynotincludedintheCoP. Mappingexperts/mini-gridleaders. Buildingresourcelibrary. SettingupanexchangevisitbetweenNigeriaandEthiopia. Settingupanexchangevisitand/orstudy-tour(severalhavealreadybeenidentifiedtodate)-contingentonresources

AMG-CoPDeclarationtocommunicatehigh-levelpoliticalmessage. AccessREALfundstodeliverTechnicalAssistancebythecountrieswhohaverequestedit. Virtualmeetingonatopictobedetermined. Webinar/virtualmeetingwithAMGCoPmembersfocusingondemandmanagement(productiveuse). KnowledgemanagementontheinformationemergingfromtheCoP. RespondingtoneedsthroughPeer-to-peerexchanges,localregionalexpertiseandREAL. Developroadmapandguideformini-gridtoolsandapplications. Newentrantcrashcourseonmini-grids-Ethiopia,Namibia,Uganda,Malawi,Zimbabwe-contingentonresources


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DevelopmentsupportforonefundraisingproposalfordeeperengagementwithearlymovercountriesandCoPsupport.

CaseStudy/KnowledgeProductontopictobedetermined. Webinaronanticipatingthearrivalofthegrid. Webinarongrid-connectedmini-gridsandtheassociatedbusinessmodel. WebinarwithAMDAontheirservicesandroleinthesector.


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5. AnnexesAnnex1–AMG-CoPProgramme

Annex2–PriorityAreas–ideasputforward

Annex3–DetailedMeetingNotes

Annex4–MeetingParticipants

Documents

African Mini-Grids Community of Practice · CoP public-private dialogue among government officials and private mini-grid developers and financiers. The key findings of this meeting