A POSITION PAPER ONSUSTAINABLE MINIGRIDSFOR RURAL ETHIOPIA

Ethiopia has made strong progress in expanding electricity generation, yet rural electricity access remains at only 44%, far below the national average of 65%. This position paper, prepared by AMDA in partnership with Precise Consult International and CLASP, argues that solar PV minigrids are the most viable solution for closing this last-mile gap, but only when they are designed as bankable, professionally managed infrastructure rather than donor-funded pilot projects.

Drawing on evidence from four operational Ethiopian minigrids, the paper examines private-led, cooperative, and utility-owned ownership models, identifying the structural barriers, including regulatory delays, tariff uncertainty, grid arrival risk, foreign exchange exposure, and weak demand growth, that continue to limit sustainability and scale.

The paper recommends a hybrid Public-Private-Community Partnership (PPCP) model that combines government-led planning and regulation, private-sector investment and operations, and community participation in governance and demand stimulation. It concludes with 13 targeted recommendations for the Ministry of Water and Energy, the Petroleum and Energy Authority, the Ministry of Finance, and development partners to accelerate Ethiopia’s transition to scalable, commercially viable minigrid infrastructure.