Total annual investment in the off-grid energy access sector surpassed $500 million in 2018, according to Wood Mackenzie's Power & Renewables and Energy 4 Impact report on Monday.
In the 'Strategic investments in off-grid energy access: Scaling the utility of the future for the last mile' report, it highlights the rapid acceleration in investment across the energy access sector.
According to the report, global energy giants are significantly investing in off-grid access.
'Nearly $1.7 billion in cumulative disclosed investment was deployed into energy access markets by the end of 2018, with over $1.2 billion deployed since the beginning of 2016,' according to the report.
In 2017, the year-on-year transaction volume grew 37 percent while total capital composition by volume shifted to over 50 percent debt, signaling scale-up and further maturation of the sector. In 2018, total transaction volumes grew another 22 percent year-on-year, and the average equity investments doubled and debt increased nearly 5.5 fold.
Benjamin Attia, Wood Mackenzie Power & Renewables Analyst and the report's lead author said that investments in the energy access have accelerated rapidly in the last few years but total volumes still fall well short of the total estimated financing needed to reach universal electricity access globally by 2030.
'As the off-grid energy access sector begins to mature, strategic investors will deeply shape the market’s trajectory and redefine the customer-centric utility business model yet again by expanding service offerings beyond a basic electricity connection,' he added.
By Gulsen Cagatay
Anadolu Agency
energy@aa.com.tr