According to a report released by the World Bank Group’s Lighting Global Program, Dalberg Advisors and GOGLA the global off-grid solar industry has taken a leap in the past year to help developing countries reach their energy access goals. Dalberg estimates that, to date, the off-grid solar sector has provided improved electricity to as many as 360 million people.
One of the key findings of the report is the dynamic growth of solar devices over the past decade: an estimated 130 million off-grid solar products (OGS) have been sold globally since 2010, ranging from small portable lanterns to 100+ Watt solar home systems capable of powering appliances such as TVs and fans. Selling in over 100 countries, these devices often provide critical first-time access to lighting and other energy services to the 2.2 billion people who still lack grid connection or reliable electricity. As the market has grown, so has the supplier base: a little over 60 dedicated suppliers in 2010 has grown to
over 330 today, with increasing specialization along the value chain.
In 2016, the most recent year for which complete data is available, total sales amounted to over 30 million devices, generating an estimated $1 billion in revenue. Sales growth of smaller devices are stabilizing, while larger devices have witnessed explosive growth of over 85% annually since 2014. This has been driven largely by pay-as-you-go (PAYGO) sales. PAYGO financing is bringing solar products within reach of more consumers than ever, and has the potential to revolutionize consumer financing in emerging markets across a much wider spectrum of products. Investment in the sector doubled annually from 2012-2016, with companies raising approximately $922 million in financing between 2012 and 2017. Ten market leaders have moved ahead of the pack, attracting over 90% of all financing in 2016.
Despite significant electrification gains since 2010, the potential market remains vast, at 434 million households. It accounts for some of the competing drivers in this dynamic market, which include the following:
(1) grid improvements provided new electricity connections to 66 million households since 2010,
(2) at least 12 million of those 66 million households received unreliable-grid access and so continue to represent a potential market,
(3) population growth in off-grid and unreliable-grid regions added an estimated 73 million new households to the potential market.
Together, these global trends resulted in an addition of nearly 20 million households to the total potential market, which grew from 415 million in 2010 to 434
million in 2017.