Rural Electrification Planning

From energypedia


Electrification plans in general, or rural electrification plans more specifically, are a means of optimizing electricity services in a given territory, within a given period of time in accordance with pre-defined strategic objectives[1]. Although in theory they are situated between the strategic and program levels, a clear distinction between these layers is often not visible in practice (see e.g. Uganda).

Electrification plans commonly depict intended developments in the field of electrification based on a spatial analysis of domestic demand, socio-economic activities and load forecasts, discerning between available electrification options (grid extension, mini-grids or off-grid systems) [2].

Benefits of Electrification Planning and Implications for Mini-grid Development

In addition to providing an indication as to the required overall levels of investment for electrification within a given area, electrification plans are an important source of guidance in the preparation and planning of project level activities. The provision of principle demand predictions, spatial division and prioritization concepts on the basis of transparent and objective criteria provide important indications for project design, in particular regarding the choice of the most suitable electrification option in a given context, identification of potential project sites and indications for adequate tariff setting.

The existence of a formalized electrification plan furthermore contributes towards planning dependability. For mini-grid projects, this applies in particular to the mitigation of risks associated with future grid extension.

The aforementioned benefits only fully materialize where electrification planning provides sufficient detail on key aspects such as grid extension plans or a sufficient consideration of decentralized solutions. In many African countries, however, this is currently not the case [3].

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Electrification Planning Process and Methodology

Key Actors in Electrification Planning

The principal duty of electricity related strategy and policy development naturally resides within the hands of the sovereign state, but a whole range of actors are potentially involved in the process. The following will therefore present an overview on various actors and their potential involvement in electrification planning [4]:

Government / public sector institutions

The state, through its respective subordinated structures, is the principal agent for electrification planning. It bears general responsibility for strategic, planning and program-level decisions on electricity and, in particular through its decision making regarding the subsidization of rural electrification, acts as a general facilitator. Apart from governmental decision making and ministries in charge of energy, a range of other public sector institutions are commonly involved in electrification planning:

  • Agencies and structures specifically dedicated to rural electrification: Where such institutions exist, rural electrification planning is commonly fundamentally integrated into their operations. In practice, however, these institutions often are subject to severe resource constraints and are ultimately ill-equipped for the task (Club ER).
  • Regulators occupy a dual role with regards to electrification planning. Upstream, they influence planning and implementation in various ways, mainly through activities relating to the setting of technical norms and standards and establishing the framework conditions for electricity market access and operation. Downstream, the planning decisions exert influence on the regulator in the exercise of his daily duties regarding issues around private sector market access and competition, tariff policy, etc.
  • Regional / local authorities: In a decentralized system, regional or local authorities possess a general competence in local development and land-use planning, which requires their participation in electrification planning. The degree of this involvement, however, can vary substantially reaching from a formal consent requirement to the delegation of electrification planning responsibilities.

Private sector institutions

Electricity companies: In extending the view beyond public sector institutions, electricity companies are among the most important actors in electrification planning. This is particularly the case, where national electricity companies exist. In such cases, electricity planning transitions into internal infrastructure development procedures on electricity production, transport and distribution.

Where liberalized markets prevail, electricity companies commonly affect electrification planning through negotiation of their roles with state actors, e.g. in terms of agreements on the limits of their infrastructure development activities, or the conditions surrounding the purchase or sale of electricity from/to the grid.

Operators: Although operators are not directly involved in the planning process, they influence planning in an indirect way. For an electrification plan to work in practice, provisions must be adapted to the prevalent nature of operators (e.g. local and small scale operators vs. large companies, non-profit vs. for-profit initiatives).

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With regards to the processes underlying electrification planning, a range of possible approaches, requiring different levels of data input, exist. Generally speaking, however, the process adheres to the following four principle steps:

Planning Approach

The choice of a basic approach to electricity planning precedes the actual planning process and poses a key determinant for subsequent steps. Approaches can be distinguished in accordance with intended process outcomes (Club ER):

  • Technical-economic: The ‘classic’ economically centered approach is based on the optimization of an economic criterion such as internal rate of return, or net present value. The indiscriminate treatment of technical or economic performance criteria creates a strong focus on densely populated areas.
  • Multi-sector approach: The multi-sector approach introduces a qualitative, energy services centered element into the technical-economic perspective. Different instruments are used to measure and weight impacts in accordance with social criteria.

Primary Data Collection: Assessing the Status Quo

For reasons of data availability and methodological differences, the type and amount of primary data collected in preparation of an electrification planning exercise varies between cases. Ideally, however, electrification planning is based on the collection and geographical referencing of data in all of the following areas[2]:

  • Existing and planned electricity grid structures
  • Location and size of population centers
  • Infrastructure in the fields of health, education and economic institutions (e.g. markets, banks, microfinance institutions)
  • Assessment of renewable energy potentials

The collection of sufficiently detailed, GIS-referenced primary data is critical for any further steps of the process and should be treated accordingly. In the development of a national electrification plan, the process of data collection commonly takes several months [2].

Electricity Demand Modelling

The process of modelling electricity demand is strongly related to the type and quality of available primary data. In principle, two basic approaches exist for demand modelling: Top-down or bottom-up.

In the top-down approach, demand is forecast through the application of econometric methods, such as the application of linear regression statistical techniques to model electricity demand on the basis of estimated changes in the number of households and GDP development.

Bottom-up models on the other hand create demand profiles on the basis of socio-economic surveys, utilizing a higher degree of data input to achieve a higher level of precision in the modelling process. A well-known example for bottom-up design was developed by IED and is used within their GEOSIM-tool (software based solutions): The methodology uses extensive data for the mapping of education, health and economic services to model demand, identify and prioritize so called development poles.

Technical / economic Optimization

The fourth and final step of the planning process comprises of the assessment of electrification solutions (network expansion, mini-grid, standalone system) and the optimization of the corresponding installation setups in accordance with the criteria defined previously (see planning approach). It is also possible to incorporate additional considerations, e.g. regarding land-use management, at this point.

Some of the main factors to be taken into account during this step include geographic parameters such as the availability of energy resources, distance to grid and between localities, or the dispersal of housing in a given area, topologic expediency and the prevalence of natural constraints (forests, protected areas, etc.) (Club ER).

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Software based Solutions in the Field of Electrification Planning

OnSSET (Open Source Spatial Electrification Tool): OnSSET is an open source GIS based tool developed to support policy development for electrificationby taking into consideration specific guidelines and targets of a region. Features include the optimal technology mix, capacity and investment requirements to achieve electrification targets. The tool has been developed by the Division of Energy Systems Analysis at Kungliga Tekniska Högskolan (KTH).

GEOSIM:GEOSIM is a commercially distributed rural electrification decision making and scenario development tool by IED. Functions provided cover spatial analysis, demand analysis, on-/off-grid supply options optimization.

HOMER (Hybrid Optimization Model for Multiple Energy Resources): HOMER is a commercial micro-grid design optimization solution originally developed by the US-based National Renewable Energy Laboratory (NREL). Features include micro-grid simulation, setup optimization, sensitivity analysis.

RETScreen / RETScreen Plus: RETScreen is a free energy project analysis and decision making software originally developed by Natural Resources Canada. Its core feature is to provide an economic comparison between different technological options for electrification within a given timeframe in a “base case” – “proposed case” structure.

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Further Information

  • Mini-grid portal on energypedia
  • National Approaches to Electrification
  • The Global Electrification Platform (GEP) can estimate the costs of electrification for households and businesses in order to help governments, finance institutions and mini-grid developers plan electrification investments in specific countries of Africa and Asia. The World Bank, ESMAP and KTH Division of Energy Systems Analysis have developed National High Resolution Dynamic Least Cost Options Plan for Universal Access to Electricity in Nigeria, Tanzania and Zambia. The web-based open source application presented here allows the users to select scenarios based on electricity consumption targeted (Tiers of access) and spatially related fuel costs. [5]
  • Afghanistan Energy Study: GIS approach to planning electrification, 2017

Rural Electrification Models and Costs: NREL Leornardo Energy (2015)



  1. Club ER, 2010
  2. 2.0 2.1 2.2 IED, 2013
  3. GVEP, 2011
  4. Club ER
  5. ELECTRIFICATION PATHWAYS.” ONSSET, Accessed 11 Mar. 2020.