Renewable energy solutions for rural electrification offer a wide range of competitive advantages such as long life spans, low maintenance and operation costs, almost non-existent fuel costs (only if used for back-up). Benefits also derive from the very low impacts to the environment and climate. They are, moreover, flexible as off-grid systems can be powered by locally – often abundantly - available resources such as a river, wind, biomass feedstocks and/or the sun. The productive use of renewables enables improved local economic conditions, which in turn allows end-users to be able to afford the electricity they consume.

It is crucial to keep in mind that a combination of improved technology and economies of scale and the continuing maturation of the renewable energy industry is continuously bringing down the costs of renewable technologies, which in turn leads to the increased cost-competitiveness of renewable solutions for rural electrification.

It is expected that the cost of producing energy from renewable energy sources will continue to decrease dramatically in the future, given the necessary framework conditions (IRENA, 2015).

The decreasing costs of renewables in the long term offers an especially large opportunity in rural areas of developing and emerging countries, where off-grid systems can use locally available resources to directly generate electricity to rural populations in a competitive way and where the vast majority of the people without electricity live.

Through the continuous development of sustainable business models, technical solutions and markets and policy frameworks, ARE and its members therefore play a key role in accelerating the global transformation of the energy sector to a market completely dominated by renewables.


Current trends and future projections for the costs of renewable technologies in Africa (USD/KW)


Source: IEA Africa Energy Outlook



Types of renewables used for rural electrification



Bioenergy is energy derived from the conversion of biomass feedstocks, where biomass may be used directly as fuel, or processed into liquids and gases. Biomass feedstocks among other things includes plants and animals, wood, waste, gas, and alcohol fuels. (IEA, 2016)

The choice of bioenergy type and the kind of biomass feedstock is determined by a number of factors such as reliable access to sustainable feedstock, economic and technical feasibility of using one technology over another, human capital to manage the technology, local weather conditions, and a sustainable business structure. (ARE, 2015)

 Small hydro

Hydropower is a renewable energy source based on the natural water cycle. In the absence of a globally agreed definition of ‘small’ hydro, the upper limit is usually taken as 10 MW, although this can be higher in some parts of the world. Small hydro is generally divided into mini-hydro (typically less than 1 MW), micro-hydro (less than 100 kW) and pico-hydro (less than 10 kW) (ARE, 2014).

It is a mature, reliable and cost-effective renewable power generation technology and requires access to running water, which means that it is site specific. It is a highly efficient, cost-competitive and very stable solution for rural electrification.  (IRENA, 2015)

Small wind

Small wind is defined as wind turbines with a capacity rating of less than or equal to 100 kW. (WWEA, 2015); (IRENA, 2015)

Wind energy potential increases very rapidly with increasing wind speed. In fact, if wind speed doubles the energy content goes up by a factor of eight. Favourable natural conditions are therefore needed for small wind energy solutions to shine. When these are present, small and medium wind turbines (SMWT) are a very cost-competitive solution for off-grid applications in rural areas. (ARE, 2012)

 Solar photovoltaics (PV)

Photovoltaics, also called solar cells, are electronic devices that convert sunlight directly into electricity. Solar energy is widely available throughout the world and plays a fundamental role in providing energy access in rural areas as it is a mature and cost-competitive technology, which is constantly evolving. There are a wide range of PV cell technologies on the market today, using different types of materials and in different sizes (IRENA, 2015).

 Energy Storage

The term energy storage refers to technologies that enable storing energy derived from a primary source for its use at a later time.

Batteries and other types of energy storage cannot per se give access to electricity, but can ensure reliability of the electricity systems, as they store energy for when production is fluctuating. They are therefore essential in ensuring stability in rural electrification schemes using renewable energy types such as wind and solar power. (ARE, 2013)