Advancing Off-Grid Electrification by Uncovering the Holistic Risk Landscape Using a Standardized Risk Management Procedure (SRMP)

Although it is now well known that access to electrification is a crucial prerequisite for ensuring sustainable development, rural households in sub-Saharan Africa in particular remain unelectrified. It is often not economically viable to connect these remote communities to the main grid. Therefore, mini-grid systems represent a promising alternative to ensure electrification even at long distances from the grid, backed by the fact that these systems are becoming cheaper with the advancement of integrated technologies. However, such systems are fraught with risk if various potential pitfalls are not considered upfront. This discourages investors and thus prevents the electrification rate to increase. The following chapter therefore aims to highlight the risk landscape for the deployment of mini-grid systems in order to assist investors in sustainably integrating mini-grid systems. The approach is illustrated using Namibia’s largest mini-grid in Tsumkwe as an example. Through the application of the SRMP, it is revealed that the mini-grid is exposed to a moderate level of risk, mainly due to a lack of education and a replacement process.