The latest Off-Grid Solar Market Trends Report 2026 shows that the number of people using solar home systems, water pumps, generators, lanterns and other off-grid solar products rose 26% from 118 million to 149 million between 2023 and 2025.
Released by GOGLA and the World Bank Group’s Energy Sector Management Assistance Program (ESMAP), the research finds that off-grid solar remains the least-cost solution for at least 298 million people without electricity access. Off-grid solar is a strong complement to grids, serving the communities beyond reach of national electricity networks.
As GOGLA Executive Director Sarah Malm puts it, off-grid solar has proven it can deliver at scale, through shocks and in places the grid has not reached.
“It now irrigates farms, keeps clinics open, and powers the business that holds rural economies together: these are the functions of economic infrastructure.”
Still, financing is not keeping pace with what off-grid solar products are being asked to do. “Until governments, investors and development partners treat it as the infrastructure it has become, hundreds of millions of people will wait longer than they should for power,” said Malm.
Affordability remains the main constraint
It may be the lowest-cost route to electrification globally, but only around a third of unelectrified households can afford an entry-level Tier 1 solar home system on pay-as-you-go (PAYG), by spending up to 5% of household consumption expenditure. An entry-level Tier 1 solar home system is able to provide at least four hours of electricity per day, with multiple light points and at last a mobile phone charging port.
Another third of those households could afford it if they spend between 5-10%.
Affordability is
- likely lower in less mature markets,
- highly sensitive to price, and
- most constrained for displaced people, women and productive use of customers buying higher-cost technologies.
Alternative business models
Businesses are using different models to tackle the issue of affordability, with Energy-as-a-Service (EaaS) re-emerging as a business model.
PAYG spreads the costs over time, like retailers offering lay-by or layaway to help customers pay in instalments before taking a product home or agricultural repayment scheduling reflecting seasonal or harvest-linked cashflows.
On the other hand, service-based models such as rentals or EaaS allow the user to pay for access or a service delivered. This is especially relevant for larger assets which are shared by multiple end-users.
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Energy-as-a-Service
EaaS is gaining traction with some companies testing the model alongside their existing operations. These companies focus on EaS using Tier 1 SHS “designed to target very low income communities and provide them with power at a fixed rate“.
The EaaS business model is also growing in the productive use of energy (PUE) space, where the asset owner sells a service such as cooling through a walk-in cold room or the electrification of a public institution. The reports suggest that the latter is proving a more sustainable alternative to traditional EPC models.
Other growing business models include battery rental and cooperative ownership.
Under the EaaS model, an operating company retains ownership and responsibility to maintain the product, and the customer pays for the provision of electricity. Theoretically the operator can charge around $2.50-4 a month and still cover lifetime O&M costs (which would include battery replacement), overhead and a profit margin.
This does, however, depend on three distinct conditions:
- 100% CAPEX subsidies,
- concessions that create customer density and economies of scale, and
- access to low-cost infrastructure-style financing coupled with political risk insurance.
“This compares to around $7 per month for unsubsidised PAYG companies that do not benefit from concessions, have a higher cost of financing, no insurance, and must recover their full costs within a shorter repayment period,” says the report.
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Adapting EaaS to address affordability issues
EaaS and concession approaches have a “mixed track record in the OGS sector.”
- In Senegal, the rural electrification priority programme PPER connected only 3,726 of 106,000 target households between 2008 and 2015. It was constrained by delayed tariffs, overlapping utility electrification and weak regulatory capacity.
- In South Africa, the Integrated National Electrification Programme (INEP) saw three out of six SHS concessions launched in 2001 close by 2011, and only 60% of systems were functional by 2015. This was due to subsidy shortfalls, persistent institutional and contractual disputes and a political shift to grid extension.
In contrast, Peru and Argentina have successfully scaled long-running, subsidy-dependent EaaS concession models for larger systems.
What about household EaaS?
Early commercial EaaS models in the off-grid solar industry proved unsuccessful and actually gave way to the more successful PAYG model.
Specifically in Africa, Off-Grid Electric—which became ZOLA—moved to rent-to-own in Rwanda and Tanzania because customers preferred to own, and servicing dispersed assets eroded the company’s profit margins. The very successful Bboxx also replaced its 10-year-hybrid service model in Rwanda with PAYG.
Both companies had a very different operational profile to the currently piloting EaaS business models, as neither targeted the whole community and both sold larger systems.
“The results of recent EaaS pilots by Easy Solar, Moon and SolarAid under the REAL Programme Catalyst are encouraging. Three pilots in Malawi, Senegal, and Sierra Leone have led to thousands of new connections.
“Four out of five participating households gained electricity for the first time, sign-up rates reached 70–100% of target communities, and usage has held up well once connected: all three pilots sustained active usage above 87% over a six-month tracking period.
“Both concessions and effective risk mitigation instruments need to be demonstrated in practice.”
On the other hand: Energy-as-a-Service to mitigate Commercial and Industrial sector energy costs
The off-grid report references the Global Energy Alliance’s Structuring for the Last Mile report that argues that a sole operator in a defined territory can achieve efficiencies, but the extent to which that can unlock savings in practice remains uncertain.
“102 Concession holders must serve every household, including the least viable, for a decade or more, and will likely face economic or climate shocks that leave their solvency dependent on discretionary government renegotiation.
“Neither the scale economics nor effective risk mitigation has yet been demonstrated.”
Find out more in Off-Grid Solar Market Trends Report 2026
