The Government of Malawi with support from the World Bank is implementing the Malawi Electricity Access Project as part of the implementation modalities for the National Energy Policy of 2018. The Project is fully aligned with and embedded in the National Electrification Plan sector-wide framework. The Project will be implemented for a five-year period starting from January 2020 by Department of Energy Affairs and Electricity Supply Corporation of Malawi (ESCOM).

This project will upscale electrification efforts that are currently being done by the Government and Electricity Supply Corporation of Malawi (ESCOM) to ensure that more people in both urban and rural areas of the country are connected to electricity networks through either the main grid or sustainable off-grid systems that will be developed with support from the private sector through the Public Private Partnership approach. The project will also construct, rehabilitate and uprate the power distribution infrastructure to ensure that distribution losses are minimized and improve the reliability of the power distribution networks in the country. The scope of the activities under the project will be three-fold.

 Component 1: Grid densification/extension

This component will finance cost-effective, priority investments in grid electrification by providing households living in close proximity to an existing distribution infrastructure leveraging on the geospatial analysis to maximize the number of connections per provided financing. Specifically, the component will finance low voltage (LV) extensions, service drops, and prepayment meters. Some of the new connections may also require reinforcing hardware elements of the supplying MV feeder for ensuring quality and reliability of supply for new connections. The project will also support the elimination of connection barriers due to unaffordable internal wiring costs by providing ready boards to the low-income households that cannot afford internal wiring costs

 Component 2:  Off-grid market development

The component will bridge the financing gap faced by solar companies operating in Malawi and hence address the challenges to developing the Off-grid solutions market. Finance will be required for (i) importers to increase stock and buy down the cost of the system through larger volumes; and (ii) distributors for working capital that currently is locked to provide PAYGO, the most accessible end-use financing. This component will set up a financing facility managed by a qualified fund manager that will provide access to loans and grants to eligible enterprises offering quality assured solar off-grid systems. Solar companies will use funds to finance stock, develop business models and build the distribution channels to reach consumers.

 Component 3: Technical Assistance and Capacity Building

This component will finance various technical assistance (TA) and capacity building activities to ensure ESCOM, MoNREM and other sector stakeholders have adequate technical, planning, and operational capacity to implement the electrification roll-out activities.