Ghana: Solar PV Systems to Increase Access to Electricity Services

Objective: to increase electricity access via solar photovoltaic (PV) systems to poor rural households in remote regions of Ghana where PV systems are the least cost technology option and grid service will not arrive for ten years or more. There were three components to the project.

1. Subsidies for solar PV systems: The project will fund output-based subsidies to private dealers for the sale, installation, and after-sale service for solar home systems of different sizes for rural households.

2. Transaction support: It is worth noting that the provision of technical assistance is consistent with emerging practices for off-grid electrification, which indicate that successful off-grid electrification projects require substantial accompanying technical assistance resources, both for the transaction and supervision, given that: (i) these are nascent markets, and (ii) governments typically lack experience and capacity to oversee these new transactions.

3. Project supervision by the Bank. Project supervision covers the work of the task team leader, the technical specialists, and the fiduciary and safeguards staff for the supervision of the Global Partnership Output-Based Aid (GPOBA) subsidies.

Outputs: The project increased access to off-grid electricity services in remote rural areas of Ghana through a blended financing scheme that facilitated loans to consumers. Using a dealer sales/consumer credit model, consumers accessed loans to purchase solar home systems and benefited from OBA subsidies, which made the systems affordable. The project supported the installation of 16,500 solar photovoltaic systems, 322 solar lanterns, and substantially increased consumer awareness of solar electricity options.