In 2024, the off-grid solar market attracted $299 million across 158 global deals, signaling robust investor interest amid a year of operational discipline, model refinement, and consolidation.
Scale-up companies continued to dominate the funding, securing $229 million, with 77% through securitizations, reflecting a shift toward structured, risk-aligned financing. A key move was Ignite Power’s acquisition of Engie Energy Access in Africa, highlighting strategic realignment among market leaders.
The Mid-tier start-ups faced challenges, raising $48 million across 16 companies—a 69% drop from the three-year average. Operational missteps, including overestimations of consumer demand and premature scaling, led to acquisitions or exits. These setbacks have fostered more realistic growth strategies and a sharper focus on sustainability.
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Seed-stage companies remained vibrant, with 67 ventures raising $19 million, maintaining stability. Locally owned African firms led innovation, making this segment a hotspot for high-impact early-stage investments.
Across all categories, Productive Use Renewable Energy (PURE) dipped from 2023 highs; however, the segment remains fundamentally strong. Innovations in agri-energy, cold chains, and rural income generation keep entrepreneurial momentum alive, especially in underserved regions where access to reliable power is transformative.
The off-grid solar market is a fast-evolving space that can transform the lives of millions. Capital flows into the sector have grown considerably over the past seven years. This means more and more people and businesses are putting their money into the off-grid solar sector.
The sector has seen growing investment and involvement from global energy players, and
strategic investors from other sectors, taking steps towards creating customer-centric utilities that go beyond electricity connection. These include appliances, financial products, and internet connectivity.
Some of the current market drivers include: – Rising incomes of households, falling product prices driven by technological innovation, improving infrastructure enabling better distribution networks, Population growth in off-grid and unreliable grid access areas- Increased availability of consumer finance1
Four Drivers of Optimism for the Off-Grid Solar Market in 2025
Political Convergence and Subsidy Support
The M300 Coalition is aligning public and private stakeholders around universal access goals, unlocking subsidies, and dramatically expanding affordability critical for scaling commercial off-grid solutions.
Led by the World Bank Group (WBG) and the African Development Bank (AfDB), Mission 300 is a unique initiative that brings together African governments, the private sector, and development partners to deliver affordable power, expand electricity access, boost utility efficiency, attract private investment and improve regional energy integration that drives economic transformation.
Recognition as Core Infrastructure
With nearly 50% of unserved populations expected to be reached through off-grid solutions, off-grid solar is now recognized as essential infrastructure. Governments are updating policies accordingly, further legitimizing the sector.
New Equity Flows
Instruments like the IFC’s Zafiri Fund are revitalizing early and growth-stage equity funding. These tailored, flexible capital sources are essential for companies transitioning through critical scaling phases.
Climate Alignment and Strategic Value
Global climate finance institutions, including the Green Climate Fund, are embracing off-grid solar as a pillar of adaptation and resilience positioning the sector as both an environmental and economic investment.
Looking Ahead
The off-grid solar industry is maturing. Business models are being tested and refined, innovation is vibrant, and the enabling environment is improving. While early-stage capital is tighter, scale-ups are attracting more sophisticated financing like securitizations. Demand signals from both consumers and governments are stronger than ever. With aligned policy, advancing innovation, and tested business models, the sector is primed for sustainable impact and scalable returns.