Financing Sustainable Energy in Remote and Under-Electrified Communities

A new study examines financial and policy approaches to expand energy access to communities facing significant electrification challenges. Published November 28, 2025, the report addresses barriers preventing reliable energy service in informal settlements and remote rural areas. Geographic isolation and limited financial viability often impede national grid expansion. Socioeconomic disparities and high connection costs further restrict energy access, even near existing infrastructure. The research analyzes diverse funding models implemented in Kenya, Rwanda, Uganda, South Africa, Eswatini, and Madagascar. These examples demonstrate strategies to overcome obstacles in underserved regions. The study highlights results-based financing (RBF) as a potentially effective mechanism. RBF incentivizes investment by linking payments to verified outcomes, such as new connections or improved service reliability. The authors emphasize the need for energy policies that acknowledge socioeconomic inequalities. They advocate for flexible and inclusive strategies within long-term energy access plans. These strategies should prioritize the specific needs of communities currently beyond the reach of conventional electrification efforts. The report suggests a shift towards decentralized solutions and community-based ownership models to ensure sustainable and equitable energy access.