At the beginning of 2015, the GSMA Mobile for Development Utilities programme (M4D Utilities), with the support of the UK Government, began working with Etisalat to explore the opportunity for Mobile Network Operators (MNOs) to partner with service providers in the deployment of mobile-enabled solutions, to improve energy and water access in Nigeria, and Pakistan while growing their off-grid customer base.
This study is the first of a series of four reports and focuses on the potential for mobile-enabled pay-as-you-go (PAYG) solar home systems, to improve energy access in Nigeria. The findings demonstrate that, while the market for off-grid solar solutions is nascent, a few actors and investments, through initiatives such as Lighting Africa, are moving the market forward and exploring the potential for mobile technology to support the deployment at scale of PAYG solar solutions in Nigeria.
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In Sub-Saharan Africa, 57% of the population lack access to electricity. In Nigeria alone, over 100 million people, or ~55 % of the population, are un-electrified, mostly living in peri-urban and rural areas . In contrast, mobile networks have become the predominant infrastructure, with over 85% of the population living within mobile coverage. As the most populated country in Africa, with a high mobile coverage and a large un-electrified population, Nigeria’s energy addressable market, defined as the number of people who have access to GSM coverage but do not have access to electricity, represents just under 70 million people. In addition to completely off-grid communities, there is also a significant number of people who have only intermittent access to electricity but have access to mobile coverage: over 80% of Nigerians revert to diesel generators as a source of power.
The rise of mobile-enabled PAYG solar solutions, notably solar home systems, as a response to underserved communities’ lack of reliable and affordable lighting and charging solutions in East Africa, highlights the opportunity for this model to scale into West Africa and Nigeria specifically. Successful PAYG solar service providers, such as Mobisol and Fenix International , have grown out of East Africa and are now exploring opportunities to replicate their models in West Africa.
A critical enabler for PAYG solar is the uptake of mobile money services, unlocking small payments through the mobile phone. In Nigeria, the number of mobile money accounts increased from 5.7 million in December 2013 to 8.9 million in December 2014. While not yet as strong a mobile money market as East Africa, with 93.4 million registered accounts as of 2014 , these figures show that the market potential is beginning to grow. The case of Nigeria speaks both to the strong market potential for PAYG solar in the region, given the size of the addressable market, as well as the importance of enabling regulations for these solutions to scale.
Click here to read the study on the potential of PAYG solar in Nigeria, as well as our recommendations to MNOs, energy services providers and the government, to support the growth of the market.