The elusive quest for sustainable off-grid electrification: New evidence from Indonesia

Mike Duthie, Jörg Peters, Carly Mphasa and Rashmi Bhat

No 1049, Ruhr Economic Papers from RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen

Abstract: High hopes are pinned to mini-grids for rural electrification, especially in remote and sparsely populated areas. This note presents new evidence from a large evaluation of a US Millennium Challenge Corporation investment into mini-grids in Indonesia. We find that, a few years after commissioning, many mini-grids in the program do not operate properly, corroborating older concerns about the sustainability of mini-grids and off-grid energy systems that have been voiced for several years. Operational costs are typically high and electricity demand low. Minigrid programs should take these structural challenges into account, and especially abstain from overly optimistic electricity demand projections.

Keywords: Energy access; sustainability; infrastructure; mini-grids (search for similar items in EconPapers)
JEL-codes: H54 O13 O21 Q48 (search for similar items in EconPapers)
Date: 2023
New Economics Papers: this item is included in nep-ene, nep-env, nep-reg and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:rwirep:279545

DOI: 10.4419/96973218

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