Evaluating the Different Clean Energy Demand Drivers: Case Studies on Operating Mini-Grids on Lolwe Island and Bunjaako Island

Abstract

Energy Transition is the shift from fossil fuels to cleaner energy sources across the globe. Specifically, Sub-Saharan Africa is lagging in ensuring affordable, reliable, and sustainable energy for all. Investments have been directed to close this gap, however, most energy access projects have impracticable economic benefits for the developers. This is mainly due to ineffective planning during the preliminary analysis of projects. One of the key aspects during design and planning is understanding the energy demand drivers. This study addresses the energy transition challenge in Sub-Saharan Africa, focusing on Uganda, where energy access projects often lack economic feasibility due to poor planning. It highlights the importance of understanding energy demand drivers in project design, specifically analyzing mini-grid plants on two Ugandan islands. Interviews with technical personnel revealed that income levels and economic growth are key drivers of energy demand, with tariffs and subsidies also playing a role but limited by the willingness-to-pay. The study notes a lack of attention to other potential demand drivers in the literature, such as climate change and gender factors. Further investigation is recommended to understand these additional factors better and improve project planning and feasibility.