Tozzi Green Madagascar – ER52: Expanding rural energy access (Madagascar)
Description
- Type of system: Decentralised solar mini-grids (photovoltaic), with a combined capacity of 1,512.5 kWp deployed across multiple sites to serve both domestic and productive (commercial) electricity uses, accompanied by an extended 800 kW hydroelectric network connection.
- Location of project: 52 villages across 6 regions in Madagascar
- Completion date: October 2026
Company description
Tozzi Green Madagascar Group, including its IPP development company Tozzi Green Hydro Madagascar, has operated in the country since 2010, evolving from its original agricultural roots into the country’s largest private investor in renewable energy, with three run-of-river hydroelectric plants, Sahanivotry, Maroantsetra, and Farahantsana, delivering a combined installed capacity of roughly 47 MW and around 185.5 GWh of 100% clean electricity annually to Madagascar’s national grid. Building on this hydropower IPP track record, the Group is now extending its renewable energy expertise to rural electrification, deploying decentralised solar mini-grids, including the 52-village program in this case study, to close Madagascar’s rural access gap.
The Challenge
Madagascar has one of the lowest electrification rates in Africa: only about 36% of the population has access to electricity nationally, and rural areas remain severely underserved with access rates estimated at 16%. This leaves roughly 21 million Malagasy without power, the majority in rural communities where remoteness, dispersed populations, and the high cost of grid extension make connection to Madagascar’s national utility (JIRAMA) network technically and financially unviable. In response, the Government of Madagascar launched its National Energy Compact (Pacte Énergétique National), committing to raise electrification access from 36% to 80% of the population by 2030, with around 80% of newly connected households expected to be reached through off-grid solutions such as mini-grids and solar home systems rather than grid extension. The 52 villages targeted by this programme sit squarely within this access gap: too remote and dispersed for cost-effective grid connection, yet identified by the government and Tozzi Green Hydro Madagascar as priority sites for accelerated electrification under the Compact.
Renewable Solution
Under the National Energy Compact, solar mini-grids and solar nano-grids were identified as the appropriate technology for the 52 target villages, given their suitability for the remote, dispersed communities described above, where extending Madagascar’s national grid is not cost-effective. Tozzi Green Hydro Madagascar was entrusted with implementation and, drawing on its decade-long presence and relationships in the regions concerned, contributed its host communities to the process of identifying beneficiary villages. Following the identification process, it was determined that 34 of the communities were located close enough to one of Tozzi Green Hydro’s existing hydroelectric facilities that extending the hydro grid would better serve their needs than a standalone solar installation, allowing these villages to be connected to a larger, more stable power source already in operation. The remaining villages proceeded with solar mini-grid and solar nano-grid deployment, whose modular designs support phased rollout while enabling both household connections and productive uses that can drive local economic activity in line with the Compact’s broader access objectives.
Project Financing and Costs
The project represents a total investment of approximately USD 5.7 million, funded through a combination of subsidy support from DECIM Fund (Digital and Energy Connectivity for Inclusion in Madagascar), a subsidy window of the World Bank Group-financed DECIM Project administered by Bamboo Capital Partners, and Tozzi Green Hydro Madagascar’s equity contribution. This blended financing structure reflects the program’s positioning within the Malagasy Government’s National Energy Compact, combining World Bank Group–backed public support for national electrification priorities with private-sector investment and operational expertise.
Project Outcome
Under this programme, approximately 8,000 households and businesses across the 52 target villages are being connected to electricity for the first time, through a combination of hydro grid extension, solar mini-grids and solar nano-grids. World Bank research on rural electrification shows this kind of access has strong potential to catalyse local economic development when paired with productive-use applications: electricity inputs into income-generating activities such as agro-processing, artisanal applications, and small commercial services. Studies of comparable mini-grid and micro-grid programs in sub-Saharan Africa have found that electrified micro and small enterprises can see productivity gains of 100-200% and income growth of 20-70%, depending on the activity, while grid-connected households have recorded income increases of up to 38%. Realising these gains typically depends on deliberate promotion of productive uses alongside basic connections, since research also shows that electrification benefits compound over time as households and businesses adopt electric equipment and new income-generating activities, creating a “virtuous cycle” of rising demand, improved electricity reliability, and local enterprise growth.
Next Steps
Building on this programme, Tozzi Green Hydro Madagascar plans to extend the reach of its mini-grid networks to serve additional members within existing beneficiary communities, while also expanding coverage to new villages beyond the initial 52. The company is also pursuing partnerships to support and develop productive-use projects within these communities, translating basic electricity access into tangible local economic opportunity. This programme serves as a pilot and proof of concept for a broader project pipeline already underway, including a 25-village nano-grid initiative and a major electrification programme for the Baie d’Antongil region, both of which will draw directly on the lessons, partnerships, and operational model established through this initial rollout.