The World Bank, through the International Finance Corporation (IFC), has issued a $3.45 million grant to help the government of Myanmar to finance an off-grid solar programme.
The signing of the Results-Based Financing for Off-grid Solar grant agreement will enable more than 450,000 people in rural Myanmar to gain access to clean energy for the first time.
The programme is co-funded by the Global Partnership for Results Based Approaches (GPRBA) and the Energy Sector Management Assistance Programme (ESMAP).
The project will be implemented by the Department of Rural Development, which will provide sub-grants to the private sector to develop supply chains for quality solar products.
IFC has supported the creation of the first commercial market for off-grid solar energy services in Myanmar under the Lighting Myanmar programme, spurring the sale and financing of nearly 90,000 quality verified solar products.
The grant funding will allow for further development of supply chains for quality lighting products in rural Myanmar, from companies to retailers and then onto consumers.
Half the population of Myanmar lacks access to grid electricity. In rural areas, where most people live, over two-thirds of households rely on candles, kerosene, low-quality batteries and diesel generators to meet their energy needs.
The funding will enable the poor to access end-user finance and post-sale services, helped by the pay-as-you-go mechanism that is being developed in Myanmar.
IFC has provided support to help the private sector in Myanmar under the Lighting Myanmar initiative, through market research on people’s needs and willingness to pay for energy access, as well as on product quality assurance, support to business and access to finance.
Mariam Sherman, the World Bank country director for Myanmar, Cambodia and Lao PDR, said: “Energy access through off-grid solar technologies can play a key role in improving livelihoods and living conditions of people in rural areas.
“The new grant will not only help deliver economic and social benefits for rural families, it will also contribute to social inclusion by providing affordable, quality solar products and by creating jobs through the expansion of supply chains in rural and remote areas.”
The pilot complements the World Bank-funded National Electrification Project ($400 million IDA credit), which has provided electricity to more than 2 million people in Myanmar through grid, private sector led-mini-grid development and off-grid solar solutions for households, public institutions and street lighting implemented through public procurement.