The informality-energy innovation-finance nexus: Sustainable business models for microgrid-based off-grid urban energy access

This paper proposes the concept of the informality- energy innovation- finance nexus, as a theoretical framework to analyse micro-grid based urban off-grid energy access. The provision of energy access in urban informal set- tlements has received increased attention by scholars working on informality and energy in recent years. Recently, scholars have looked at the off-grid-urban informality nexus and have argued for the integration of off- grid electrification technologies in South Africa's informal settlements. Concurrently scholars have argued for more user centric business models for off-grid contexts. Off-grid technologies like micro-grids and stand-alone solar home systems have become an integral part of the energy landscape of energy access in Sub-Saharan Af- rica and can fill a key gap for unelectrified urban informal settlements. However, there remains a gap in the literature linking user-centric off-grid business, financing models and urban informality. This paper fills this gap and argues for greater contextual embeddedness and attention to the local context when implementing off-grid business models in settings of urban informality. This paper draws on the findings of the Umbane project, a pilot study on solar powered refrigeration for women owned enterprises connected a micro-grid in an informal set- tlement Qandu-Qandu in Cape Town, Khayelitsha. This paper uses mixed research methods, including semi- structured interviews with entrepreneurship project participants and a survey. This paper offers key insights from our practice-based work on implementing solar micro-grids in settings of informality and the contextual factors and drivers that shape the informality, energy-innovation and finance nexus.