Smart Grid Communities - Our Model

We have established Smart Grid Communities as a not-for-profit social enterprise, registered in South Africa
Our model will be to assist rural communities and informal settlements in South Africa to electrify households and community buildings utilizing solar PV and energy storage.
We will engage with Independent Power Producers, Donors and Government to secure capital funding to build mini grids, we have developed a robust financial model to support bids for funding.
The ownership of the mini-grid and related assets will be transferred to a social enterprise operating within the community. SmartGrid will provide training and capacity development support for the newly formed social enterprise.
All households within a community will be guaranteed access to affordable electricity, with those households not directly connected to the grid supported by rechargeable mobile batteries.
We initially propose to develop 2 “pathfinder” projects one in Eastern Cape and the other in KZN.
We plan to deliver 40 projects over 5 years, in a mix of rural settings, in so doing we will establish a template for scale and replication.

Model of Engagement, IPP’s & Donors

Our model is to work with independent Power Producers (IPPs) to provide direct benefits for off-grid rural communities from the development of large-scale renewable energy infrastructure.
Working with the current requirement for an IPP to spend a minimum of 2.5% of project value on socioeconomic projects, we can utilize this budget to support the capital and revenue costs of rural grid provision.
We will aim to match IPP contributions $ for $ from international donors to enable base infrastructure to be provided to community enterprises on a nominal annual lease basis
We would work to a capped 10% budget for Smart Grid Communities project support costs
Projects need capital for initial set-up costs and revenue to ensure long-term sustainability, we will establish contracts with IPPs and Community Trusts to ensure that capital and revenue support is provided. The revenue support will likely be over a 20-year period to coincide with the length of the project Power Purchase Agreement (PPA)
We aim to develop a financial model that can be adopted by Community Trusts, IPPs, and Donors throughout sub-Saharan Africa.