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Off-grid solar sparks a lantern sales boom in Africa – report

A new report reaffirms the resilience of off-grid solar in providing clean electricity access in Africa. Cash sales of lanterns are booming, signaling diversification beyond the PAYGo transaction model.

A new report has highlighted the continued popularity of lanterns powered by off-grid solar alternatives as more people opt for cleaner lighting options in Africa.

The report ‘Global Off-Grid Solar Market Data July-December 2023’ by the Global Off-Grid Lighting Association (GOGLA), the global association for the off-grid solar energy industry, is based on sales reported by 32 solar energy kit manufacturers and 34 appliance manufacturers in the second half of 2023.

According to James Nzioka, a sustainable energy researcher at the University of Eldoret in Kenya, the trend highlights the growing relevance of off-grid solar power in addressing last-mile electrification challenges on the continent.

“Millions across Africa still lack access to the grid,” Nzioka said in a phone interview.

“But with off-grid solar, even the most remote villages can light up their homes using energy alternatives that are clean, efficient and affordable,” he added.

A key insight from the report is the growing number of lantern sales across four regions of Africa — East, West, Central and Southern Africa — assessed in the report.

The authors of the report also point to a diversification from rent-to-own purchases (PAYGo) to cash sales. Nzioka attributes this shift to a burgeoning middle class with disposable income and declining solar kit prices.

In Kenya, for instance, a rise in lantern sales sold in cash led to a 22% increment in cash sales for all kits and appliances in the country compared to those made in the first half of the year. Comparatively, there was a 5% increase in sales made via the PAYGo option.

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According to Nzioka, however, the shift towards cash transactions doesn’t undermine the viability of the PAYGo model.

“PAYGo is still very relevant on the continent and will continue to influence off-grid solar growth in the region,” he added.

In East Africa, where more than 2.5 million solar energy kits were sold between July and December 2023, lantern sales increased by 17% compared to the first half.

Lanterns with low energy needs ranging between 0-1.5 Wp (watt peak capacity) witnessed the highest growth rate in sales.

Kenya was East Africa’s largest market for off-grid solar energy kits, representing 74% of the total sales made in the region.

A similar rising trend in the number of sales for low-energy lanterns was also recorded in West Africa, where sales for this category increased 18% compared to the first half of 2023.

Just like in East Africa, sales made by cash steadily continued, with their increasing trend rising by 15% for all solar energy kits. The PAYGo segment, on the other hand, decreased by 1%.

Nigeria is the biggest off-grid solar energy kit market in West Africa, accounting for 82% of all sales made in the region.

Two markets—Cameroon and the DRC—dominate the off-grid solar energy kit market in Central Africa.

In the southern African region, where confidentiality rules cloud country-by-country analysis, the report notes that kit sales rose by 62%, most of which were made in cash.

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“Cash sales, led by lanterns, increased by 78% compared to the two previous half years,” the report noted.