Rural electrification is the process of bringing electrical power to rural and remote areas. Rural communities are suffering from colossal market failures as the national grids fall short of their demand for electricity. As of 2017, over 1 billion people worldwide lack household electric power – 14% of the global population. Electrification typically begins in cities and towns and gradually extends to rural areas, however, this process often runs into obstacles in developing nations. Expanding the national grid is expensive and countries consistently lack the capital to grow their current infrastructure. Additionally, amortizing capital costs to reduce the unit cost of each hook-up is harder to do in lightly populated areas (yielding higher per capita share of the expense). If countries are able to overcome these obstacles and reach nationwide electrification, rural communities will be able to reap considerable amounts of economic and social development.
A mini-grid, also sometimes referred to as a micro-grid or isolated grid, is an off-grid system that involves small-scale electricity generation (10 kW to 10MW) and which serves a limited number of consumers via a distribution grid that can operate in isolation from national electricity transmission networks.
The second and equally competitive option is to use stand-alone systems. Stand-alone systems are small electricity systems, which are not connected to a central electricity distribution system and provide electricity to individual appliances, homes or small productive uses such as a small business. They thus serve the needs of individual customers, while utilising locally available renewable resources.
