Rural electrification through solar powered mini-grids: a study of private sector models in Kenya

In Sub-Saharan Africa more than 630 million people live without access to electricity which is a constraint to social and economic development. In Kenya more than 35 million people do not have access to electricity. Due to recent developments like price drops and increased quality in solar PV technology, better mobile coverage and access to mobile payment solutions, several mission-driven private firms have emerged in Kenya delivering power to rural residents through solar powered mini-grids. The aim of this PhD thesis was to explore the processes behind the emergence of such private-sector engagement, as well as the functioning and effects of specific private-sector models. This was pursued through a qualitative multiple case-study. The dynamics of change in the Kenyan rural electrification regime were investigated through the lens of the multilevel perspective to explore how niche-level actors conduct institutional entrepreneurship to influence existing structures in the rural electrification regime.

Furthermore, mini-grid firms’ practices were explored to understand how they respond to competing institutional logics made available to them due to their dual social and economic mission. The research found that firms seek to make private mini-grids a viable and sustainable alternative to grid-extension by following different strategies. While some actors sought to strengthen the private mini-grid niche by actively seeking to influence and change the ‘rules of the game’ in the broader rural electrification regime through negotiations, advocacy and other forms of institutional work, other actors are following a strategy of strengthening the niche from within by building partnerships and generating knowledge and learning. At the firm level, the research found that mini-grid firms respond differently to the competing demands of the social welfare and economic viability logics available to them. While some firms enact the logic of economic viability as the predominant logic guiding their work, other firms combine and blend the two logics. While it is too early to draw conclusions regarding the prospects for the long-term sustainability of these firms, the existence of these various strategies is significant in two ways. First, it suggests that mission-driven enterprises can be differentiated based on the way they enact logics in their work. Secondly, it opens up a path to further research into how each of these strategies may influence the long-term sustainability of these firms.