The missing middle of mini-grids: Why thousands of successful projects still won’t end energy poverty

…Why the gap between a working pilot and a financeable portfolio, not the gap between diesel and solar, is the story

One conversation keeps returning whenever I think about the future of mini-grids in Africa. It was not with an engineer discussing solar panels or a financier debating interest rates. It was with a project developer who had done almost everything right. The feasibility studies had been completed. Community engagement had taken months. The demand assessment was sound. The technology had been selected. The economics worked. Yet the project remained stalled for reasons that had little to do with electricity.

“The hardest part isn’t building the mini-grid anymore,” he told me. “The hardest part is getting from one successful project to the next hundred.” That observation captures one of the least discussed realities in energy access today. We have spent years improving the technology that powers mini-grids. We have spent far less time improving the systems that allow thousands of successful projects to become a market capable of attracting institutional capital at scale.

That gap; not between diesel and solar, but between a working pilot and a financeable portfolio is the subject of this piece. That gap is the subject of this piece.

The numbers that should embarrass US

Globally, mini-grids are no longer an experiment. The World Bank’s Energy Sector Management Assistance Program has catalogued roughly 19,000 to 21,000 installed mini-grids worldwide, connecting an estimated 47 million people. ESMAP’s own modelling shows the technology could reach close to 500 million people by 2030, but only if the world builds around 210,000 more of them, at a cost of roughly $220 billion, and only if the pace of deployment in the twenty countries with the largest access deficits rises from today’s 10 to 50 mini-grids a year, per country, to more than 1,600 a year.

Sit with that multiple. Not a doubling. Not a tripling. A jump of roughly thirty to one hundred and sixty times current deployment rates, sustained for most of a decade.

It is difficult to look at those numbers and conclude that technology is the problem. Solar modules are cheaper than they were a decade ago. Battery performance continues to improve. Engineering standards are no longer experimental. The technology has matured far faster than the institutions built to deploy it. The per-unit cost of solar mini-grid electricity has already fallen sharply over the past decade, and system designs have matured through more than two decades of field iteration. What has not scaled at anything like the same rate is the machinery that turns a proven design into a repeatable pipeline: the aggregation vehicles, the standardised power purchase templates, the shared due-diligence documentation, the operations platforms built for hundreds of sites rather than one. Call it what it is: another missing middle. Not in engineering, but in finance, project preparation and institutional capacity.

WHY NIGERIA MAKES IT VISIBLE

Nigeria is, once again, the clearest single window onto a global pattern.

The Rural Electrification Agency reported deploying more than 200 mini-grids across underserved communities in 2025 alone under the Nigeria Electrification Project; a genuinely significant year of delivery. Layered on top of that is the $750 million Distributed Access through Renewable Energy Scale-Up programme, DARES, which is targeting 1,350 mini-grids nationwide and an estimated 17.5 million newly connected Nigerians, with more than 900 already under construction toward that goal. In parallel, the Africa Minigrids Programme, run by REA with UNDP and Global Environment Facility backing, has delivered 23 solar mini-grids across 15 states, powering an estimated 50,000 people, with a further phase targeting tens of thousands more households and micro-businesses.

Read quickly, this looks like a sector in motion, and in fairness, it is Nigeria’s 2026 Mini-Grid Regulations, revised earlier this year, were specifically designed to address the tariff certainty and investor-protection gaps that had been holding developers back, and roughly forty interconnected mini-grids are now in the pipeline to add close to 288 megawatts back onto a national grid that badly needs the relief.

Read closely, however, and those same numbers tell a different story. A 200-mini-grid year, a 1,350-mini-grid target and a 23-site pilot programme all reflect individually successful projects. What they do not yet represent is an aggregated, standardised portfolio that institutional investors can finance repeatedly and at scale. Nigeria is not failing to build mini-grids. It is doing what much of the world is still doing: delivering excellent projects one transaction at a time. The challenge is that energy poverty cannot be solved one transaction at a time.

I have sat in versions of this same room in more markets than Nigeria; a strong site, a credible developer, a committee that wants to say yes and cannot find a structure that lets it say yes fifty times over rather than once. I have seen versions of this conversation repeated in Lagos, Abuja, Nairobi and Accra. Different developers. Different investors. Different countries. Yet the questions are almost always the same. The project itself is technically sound. The community wants the electricity. The numbers broadly work. What neither side can easily solve is how one successful project becomes fifty without rebuilding the entire transaction from the ground up. The geography changes. The structural problem rarely does. The pattern does not change much from one geography to the next, which is itself the point. This is not a Nigerian dysfunction. It is what the missing middle looks like whenever it is left unaddressed for long enough.

DEVELOPERS PRESENT PROJECTS. FINANCIERS NEED PORTFOLIOS.

I have spent enough time sitting with both developers and investors to recognise this pattern almost immediately. Both sides usually arrive wanting the same outcome. Both believe in the technology. Yet they often leave the meeting frustrated—not because the project is weak, but because the structure around it isn’t built for scale.

A developer arrives with a strong site: a credible demand assessment, a workable engineering design, a community that wants the power and has demonstrated, through its diesel and generator spend, that it can pay for it. In the developer’s own account, this is a good, fundable project, and on its own terms, it usually is.

An investment committee, on the other side of that table, is very rarely evaluating a single site on its own terms. It is evaluating whether this site is the first of many that can be underwritten using one legal structure, one technical standard, one monitoring system, and one due-diligence process — because the transaction cost of evaluating a modest single-site mini-grid individually is not meaningfully lower than evaluating a portfolio of fifty, and no institutional balance sheet can afford to run that arithmetic project by project, indefinitely, at the volumes the sector needs. The mandate is real. The appetite is real. What is missing is a unit of supply the mandate can actually absorb.

This is not a story about cautious financiers or underprepared developers. It is a structural mismatch between the unit the sector is good at producing — the single, well-built site — and the unit institutional capital is built to absorb, which is the standardised, aggregated portfolio. Every successful mini-grid that remains an isolated success represents more than one electrified community. It represents dozens of future communities that may never receive power because the first project never became a repeatable investment model.

WHAT THIS COSTS, AND WHAT IT IS WORTH

None of this is unique to Nigeria, and none of it is really about mini-grids as a technology. ESMAP’s own data on Africa and South Asia together show total mini-grid investment of around $5 billion for roughly 11,000 sites serving some 31 million people, a fraction of the $220 billion the model says is needed globally to hit the 2030 target. Contrary to popular belief, money is no longer the scarcest resource in this sector. Patient capital exists. Development finance institutions have made that clear. Private investors are increasingly interested. What remains scarce is the kind of standardised pipeline that allows large pools of capital to deploy quickly without reinventing due diligence for every individual site. Development finance institutions, blended finance vehicles, and increasingly private investors have made their appetite for this sector clear, repeatedly, in public. The shortfall is in the aggregation and standardisation layer that would let that capital find one hundred sites at once instead of evaluating one site one hundred times.

That gap is also, properly understood, where the opportunity sits and where the next phase of the sector will actually be won. A single mini-grid is a project. Two hundred mini-grids, aggregated into one structure with shared documentation and a common operating platform, is an asset class; and asset classes are what institutional capital is actually designed to hold. Building that structure is unglamorous work: standardised power purchase templates, a shared technical specification robust enough to survive across regions, a monitoring platform that lets one operations team manage hundreds of sites instead of visiting each one, and a project preparation facility that treats the early-stage work feasibility, permitting, community agreements; as infrastructure worth funding in its own right rather than a cost each developer absorbs alone.

The developers and DFIs that build that connective tissue first, rather than simply building more individual sites, will not just capture more of the $220 billion. They will set the standard the rest of the sector eventually has to adopt, the way a handful of early aggregation platforms in other infrastructure classes ended up defining how entire markets financed themselves for a generation afterward.

I still think about that simple question: “If this works here, why isn’t the next village already connected?” It is the kind of question only someone outside the sector would ask, precisely because they assume success should naturally lead to replication.

But replication has never been automatic. The next village is not waiting for better solar panels. It is not waiting for cheaper batteries. It is not even waiting for another successful pilot. It is waiting for someone to build the institutional bridge between success and scale.

That bridge is the missing middle.

Until we build it, we will continue celebrating thousands of successful mini-grids while hundreds of millions of people remain without reliable electricity. The future of mini-grids will not ultimately be decided by engineering. It will be decided by whether we can transform isolated projects into an investment system capable of delivering energy access at continental scale.

Nwafor is founder and lead strategist at De-Lazuli Consult, an advisory practice focused on energy transition, project finance, DFI engagement, and carbon market strategy. His work supports developers, investors, development finance institutions, and public-sector stakeholders in project preparation, transaction structuring, stakeholder engagement, and capital mobilisation. He writes from Lagos and Abuja. [email protected], +2348094561290