Off-grid solar strengthens energy access economics for 398 million people, World Bank report says

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Off-grid solar expands access

Highlights

Off-grid solar product users increased 26% in two years to 149 million, with sector supporting energy access for 398 million people, according to the World Bank Group report.
Reaching universal off-grid solar access by 2030 requires USD 11.4 billion total investment, including USD 1.3 billion annually in grants and subsidies and USD 1.6 billion in annual financing.
Off-grid solar sector generated USD 28 billion in income and savings over 15 years, created 219,000 jobs, but affordability remains a key barrier for two-thirds of target households.

Market growth and financing needs

As reported by World Bank, citing the World Bank Group's Energy Sector Management Assistance Program and GOGLA, the Off-Grid Solar Market Trends Report 2026 shows the number of people using solar home systems, water pumps, generators, lanterns and other off-grid solar products rises by 26% over the past two years, to 149 million from 118 million. The report is released at the Global Off-Grid Solar Forum and Expo in Kigali.

The study says off-grid solar remains the least-cost solution for at least 398 million people without access to electricity, while also complementing grid and mini-grid expansion. It says reaching those populations by 2030 requires sustained public and private investment, backed by policies that improve affordability and widen access to financing.

According to the report, off-grid solar is increasingly treated as infrastructure rather than only a temporary bridge to the grid. Among surveyed customers, 95% say their solar home systems remain functional four or more years after purchase, highlighting the sector's durability and maturity.

The report estimates that unlocking the sector's potential by 2030 requires about USD 11.4 billion in investment, including USD 1.3 billion a year in grants and affordability subsidies and USD 1.6 billion a year in equity, debt and receivables financing. It says that total represents a modest share of the estimated USD 3 trillion to USD 5 trillion in average annual energy transition investment needed by 2030.

Jobs, incomes and policy implications

The report says 7.4 million people use off-grid solar to power microenterprises or support income-generating activities across agriculture, retail and services. Over the past 15 years, these products generate an estimated USD 28 billion in additional income and savings for customers, while the surveyed market employs 219,000 people, up 29% over the past two years.

The findings come as countries advance Mission 300, the World Bank Group and African Development Bank initiative to connect 300 million people to electricity across sub-Saharan Africa by 2030. Distributed renewable energy, including off-grid solar, is expected to play a significant role, with 80% of the 35 National Energy Compacts developed under Mission 300 including distributed renewable energy in their connection targets.

Despite its cost advantage, the report says affordability remains a major barrier. Only one in three households without electricity can afford an entry-level solar home system through pay-as-you-go financing, while another third can do so only with difficulty.

It says targeted measures such as VAT exemptions, import duty waivers and subsidies can help close the remaining affordability gap while supporting further market growth. World Bank Group commitments to off-grid solar, described as the largest source of public funding for the segment, reach USD 974 million in FY25-26, matching the level in FY23-24.

In our earlier article on the IMF’s updated outlook for sub-Saharan Africa, we noted that while the region’s 2026 growth forecast was revised higher, inflation risks and tighter monetary conditions were also expected to intensify. We highlighted how rising borrowing costs, debt-servicing pressures, and climate-related shocks could strain budgets and make access to financing more difficult across the region.

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