African Model
Minigrid Regulations Tool

Introducing the Minigrid Regulation Tool & Templates

1 2 Read the guide Start the tool For this tool to work, macros must be enabled. Find instructions in section 4 below. Scroll down to review the introductory document and learn more about this tool and its features. Further background information and guidance is available here:
Legal guideline Technical guideline Economic guideline

Published by

African Forum for Utility Regulators (AFUR)

African Forum for Utility Regulators (AFUR)

526 Madiba Street, Arcadia, 0083.

Pretoria, South Africa

info@afurnet.org / afurnet@gmail.com

© 2026 AFUR/GET.transform

Place and date of publication

Pretoria, July 2026
Version 19.4

Acknowledgements

AFUR is grateful to the support provided by the European programme GET.transform in the development of this tool. get.transform.eu

Further gratitude is extended to the expert authors who developed the tool commissioned by GET.transform:
gfa-group.de | inensus.com | detailsolicitors.com

Contents

1	Introduction	3

2	Presentation of the high-level scenarios	4

3	Additional (independent) sub-options	5

4	How to use the tool	6

Annex I: Comparison of the eight high-level scenarios	8

Introduction

The development and uptake of renewable energy minigrids in Africa rely heavily on the presence of clear, consistent, and supportive regulatory frameworks that facilitate investment, ensure cost recovery, enable grid integration, simplify administrative processes, protect consumer rights, and maintain technical standards. Effective regulation can create an enabling environment that fosters sustainable growth in the renewable energy sector, ultimately contributing to the continent's energy security and economic development.

Based on these premises, GET.transform and AFUR have partnered to develop model minigrid regulations and tools and to support their adoption across the continent.

The Minigrid Regulation Templates presented in this short report constitute a key element of this joint endeavour. Rather than preparing a single set of minigrid regulations, an interactive tool has been developed allowing policy-makers and regulators to make tailored choices based on their country contexts and to adopt the most suitable approach to support and scale up minigrid development.

Figure 1 below provides an overview of the regulation iteration steps. The first step defines the high-level scenario or delivery model to be considered in order to develop minigrids in a given country. In order to complete this step, users are required to answer four main questions regarding: (a) overarching minigrid model features; (b) structural and procedural aspects; (c) technical aspects; and (d) tariff calculation methodology. Based on the answers to these questions, one out of eight possible scenarios is selected. These scenarios are briefly described in Section 2.

Then, the second step of the regulation iteration steps involves the refinement of the chosen scenario based on user preferences regarding a longer list of more specific topics, from economic regulation questions to administrative details regarding licensing procedures. An overview of these topics is provided in Section 3.

FIGURE 1. Overview of the Minigrid Regulation Template iteration steps.

The interactive tool allowing users to generate their tailored minigrid regulation template is based on a Word file where macros have been used in order to create an interactive menu and generate the corresponding regulation text at the end of the process. More details on how to activate macros and more generally use the tool properly are provided in Section 4.

Presentation of the high-level scenarios

As described in the introductory section, the Minigrid Regulation Templates aim to cover a broad range of policy and financing contexts, adjusting minigrid regulations to them.

Eight high-level scenarios have been developed, based on the answers to the following four overarching questions:

a)	Overarching mini-grid model features: this involves a consideration of the ownership (and financing structure) of mini-grids and whether it is based on a public, private, or hybrid (split asset) ownership model. This also includes questions around the authorisation/contractual instrument either issued or agreed with authorities/regulators for mini-grid development such as Concession Agreement, Minigrid Project Agreement or Minigrid License;

b)	Structural and procedural aspects: institutional linkage of the regulatory authority and grid arrival risk mitigation;

c)	Technical aspects: compliance with distribution and metering requirements; and

d)	Tariff considerations: minigrid tariff cap and tariff revision approach.

The main characteristics and differences between concession, minigrid project agreement and issued license are presented in the table below:

AUTHORIZATION instrument	description
CONCESSION AGREEMENT	A Concession is an agreement between the grantor (host country) and the concessionaire (minigrid developer) that grants the right to develop, operate, and maintain a minigrid or related infrastructure for a specific period, subject to certain terms and conditions such as exclusivity, service levels, and country-specific technical standards. Concessions provide adequate protections to the Concessionaire and contain elaborate risk allocation provisions. A further distinguishing feature of a concession is the right of renewal/of reversion/handover of the assets to the government after the concession term or hand back where there has been an early termination which is not the case for a Minigrid Project Agreement.
MINI-GRID PROJECT AGREEMENT	A Minigrid Project Agreement is a form of authorization which takes the form of a formal contract and outlines the terms and conditions under which a license is granted. It is a legal document that specifies the rights and obligations of both the licensor (the government) and the licensee (the minigrid developer). The Minigrid Project Agreement may typically include details such as the scope of the license, any restrictions, duration of the license (typically above 20 years), warranties, and any other relevant terms and conditions such as transferability. Notably, Minigrid Project Agreements will impose contractual obligations on the government such as honoring the license duration and eliminate the risk of unilateral termination of such license and expropriation of private investments.
ISSUED LICENSE	An Issued License is a formal authorization pursuant to an application process granted by a government agency or regulatory authority to a minigrid developer to undertake certain prescribed activities (i.e., establish, own, or operate a minigrid) within an identified area. It would typically consist of a licence certificate and licence terms and conditions or have both in the same document.

Figure 2 below shows how the different scenarios differ based on these three parameters:

Minigrid ownership and operation model	Public asset ownership	Private asset ownership	Split asset (hybrid) model
Contractual arrange-ment (PPP)	Concession agreement	MG license with optional agreement	Minigrid license	Concession agreement	MG license with optional agreement	Minigrid license
Minigrid tariff	Main grid	Cost-reflective
Scenario	1	2	3	4	5	6	7	8

FIGURE 2. Decision tree for minigrid regulation scenarios.

After the user answers these initial questions, the tool will display a summary page providing an overview of the resulting scenario with its pros and cons.

Annex 1 provides a more detailed description and comparison of the eight scenarios. It should be noted that Scenarios 3 and 6, where a concession agreement is selected as the authorization/contractual instrument, are based on the IFC Scaling Minigrid Concession Agreement Template. All of the other scenarios are based on a “regulations for minigrids” template developed by INENSUS, AfDB’s Green Minigrid Help Desk, UNIDO, ARE and AMDA.

Additional (independent) sub-options

Once the high-level scenario is defined, there are about 10 to 12 questions to answer (the exact number will depend on the scenario chosen) in order to refine the Minigrid Regulation Template that will be generated at the end of the process.

These questions are listed below, grouped into the following three sections:

Structural and procedural aspects

Institutional linkage of the Regulatory Authority

Type of electricity market

Application submission type

Site allocation method

Technical aspects

Technical requirements (generation system and distribution network)

Technical requirements (metering system)

Additional tariff considerations

Minigrid tariff cap

Asset depreciation method

Smoothing out tariff fluctuations

Activation of OPEX during first years

Tariff revision approach

For each question, expert guidance is provided by describing the importance of each topic. Furthermore, guidance is also provided regarding the suitability of each particular answer, so that users can understand the potential pros and cons of specific choices. At the end of the selection process a summary page is displayed showing indicative scores based on the decisions made. While countries present different contexts and priorities, and this is the very reason why this tool allows for a variety of regulations, these scores seek to capture the degree to which choices made align with what is currently considered best practice for minigrid regulations so that their impact towards accelerating energy access can be maximized. Based on such feedback and on their specific country contexts and constraints, users can then go back and reconsider some of their previous decisions.

How to use the tool

The interactive tool allowing users to generate their tailored minigrid regulation template is based on a Microsoft Word file using macros to create an interactive menu and generate the corresponding regulation text at the end of the process. To activate macros, follow the sequence displayed in Figure 3 below.

FIGURE 3. Steps to allow macros in a Microsoft Word document.

After successfully completing the questionnaire and receiving the corresponding regulation text, you may wish to conduct a detailed comparison between different templates. This can be efficiently accomplished using Word's built-in 'Compare' feature. To begin, ensure you save the original regulation template. Then, generate the second (revised) version. Once both templates are prepared, proceed as follows: Go to 'Review' > 'Compare' > 'Combine' in Word. In the pop-up window, select the original document and the revised document. If necessary, click on the folder icon to navigate to the location of the file. In the 'Label unmarked changes with' box, enter a name or phrase that identifies the revised document. Word will then open a new document combining both versions. Here, changes are highlighted in track mode, labelled with the name or phrase you provided, which allows for a straightforward and systematic review of the differences.

FIGURE 4. Illustration of the in-built comparison feature.

Annex I: Comparison of the eight high-level scenarios

Public asset Ownership (Scenarios 1 & 2)

Common aspects Scenario 1 & 2	Specific aspects Scenario 1	Specific aspects Scenario 2
Description	Ownership (and financing) of minigrid assets is public, and where private sector is involved at the operation stage under an ESCO (Energy Services Company) Model	Minigrid tariffs are equal to the national tariff	Minigrid tariffs to be charged by the ESCO are calculated on a cost-reflective basis
Strengths/ Opportunities	Fast deployment at scale possible, if funding is available Opportunity to involve existing Distribution Companies (DISCOs) in minigrid electrification	Lower risk of tariff related customer complaints, due to use of national tariff	Lower financial risks for minigrid operators as tariffs can be adjusted
Challenges/ weaknesses	No incentive at the construction stage to ensure long term technical performance No incentive to properly assess demand and dimension plants accordingly	High financial risks for ESCOs (risk that national tariffs will not cover O&M + reinvestments) and thus for project sustainability	More complex tariff setting procedure, if no such process is previously in place Risks of tariff related customer complaints
Cost implications	High CAPEX grant requirements for public sector (≈1000 USD per connection)	Risk of OPEX subsidies needed	Potentially higher than grid tariffs for consumers

Private Asset Ownership (Scenarios 3 to 5)

Common aspects Scenario 3-5	Specific aspects Scenario 3	Specific aspects scenario 4	Specific aspects scenario 5
Description	Ownership (and financing) of minigrid assets is private, although some CAPEX subsidies might be in any case required	Concession Agreement is signed between the government and the minigrid developer which may include a right of renewal or hand back provisions in the case of early termination which is not the case for a Minigrid Project Agreement.	The regulator issues a license with an optional minigrid project agreement. The agreement is signed between the government and the minigrid developer which may typically include details such as the scope of the license, any restrictions, and duration of the license.	The regulator issues a license to the minigrid developer to undertake certain prescribed activities (i.e. establish, own, or operate a minigrid) within an identified area, pursuant to an application process.
Strengths/ Opportunities	Lower levels of government/public funding are required. Private sector involvement attracts specialized knowledge, experience, and expertise. Private sector investments expand access to electricity in remote or underserved areas. Opportunity to leverage diverse sources of funding. More private investments mean that the right incentives are there for long-term sustainability.	A balanced well-negotiated concession agreement should ensure that the contractual obligations of the government (grantor) and concessionaire will be upheld through regulation by contract, in particular where legislation and regulation do not take care of this. Availability of dispute resolution mechanism in the concession agreement mitigates against arbitrary action by the government (grantor). Can be ensured by MIGA and similar tools and therefore provides protection against government adverse action.	Use of the Minigrid Project Agreement affords protection to the minigrid developer against unilateral actions of the government and provides a basis for holding the government accountable to its contractual obligations. Availability of a dispute resolution mechanism (as negotiated between the parties to the Minigrid Project Agreement) mitigates against arbitrary action by the government. Can be ensured by MIGA and similar tools and therefore provides protection against government adverse action.	Operating under an issued license typically requires less time and administrative effort from all sides (regulator and developer), so it might be well adapted to small projects. The issued license proposed here may also qualify for MIGA, though it is less favourable compared to agreements.
Challenges/ weaknesses	It is a relatively riskier model for the private sector in terms of requirements for regulatory certainty and risk mitigation mechanisms. High tariffs may create political and customer satisfaction issues and might make rural electrification more difficult. A privately financed minigrid would attract more project development and financing costs.	Signing a concession agreement typically involves significant administrative effort and cost on both sides. It might therefore slow down projects. Concession agreements are more difficult to extend at the end of their term due to concessionaire performance reviews, changes in public interest and/or in law.	Signing a Minigrid Project Agreement typically involves significant administrative effort and cost on both sides. It might therefore slow down projects.	The use of an issued license, rather than concessions or Minigrid Project Agreements, may not provide the same protection against some of the key risks, especially if it does not provide a long-term exclusivity period or license tenure.
Cost implications	Lower CAPEX grant requirements for the public sector (≈300-500 USD/connection). Higher tariffs for consumers (≈0.50-0.70 USD/kWh) or need for additional CAPEX grants to reduce them

Hybrid Asset Ownership (Scenarios 6 to 8)

Common aspects scenario 6-8	Specific aspects scenario 6	Specific aspects Scenario 7	Specific aspects SCenario 8
Description	Ownership (and financing) of minigrid assets follows a split asset model. Typically, public sector finances and owns the distribution network while the private sector does the same for the generation infrastructure and connections.	Concession Agreement is signed between the government and the minigrid developer which may include a right of renewal or hand back provisions in the case of early termination which is not the case for a Minigrid Project Agreement.	The regulator issues a license with an optional minigrid project agreement. The agreement is signed between the government and the minigrid developer which may typically include details such as the scope of the license, any restrictions, and duration of the license.	The regulator issues a license to the minigrid developer to undertake certain prescribed activities (i.e. establish, own, or operate a minigrid) within an identified area, pursuant to an application process.
Strengths/ Opportunities	Split asset allows government to provide higher CAPEX grant volumes while ensuring that minigrid developers contribute their quota of investments in the project. There is a lower risk and corresponding lower cost of capital for minigrid developers. Relatively lower tariffs than in fully private sector-owned models.	A balanced well-negotiated concession agreement should ensure that the contractual obligations of the government (grantor) and concessionaire will be upheld through regulation by contract, in particular where legislation and regulation do not take care of this Availability of dispute resolution mechanism in the concession agreement mitigates against arbitrary action by the government Can be ensured by MIGA and similar tools and therefore provides protection against government adverse action.	Use of the Minigrid Project Agreement affords protection to the minigrid developer against unilateral actions of the government and provides a basis for holding the government and licensee accountable to their contractual obligations. Availability of a dispute resolution mechanism (as negotiated between the parties to the Minigrid Project Agreement) mitigates against arbitrary action by the regulatory authority. Can be ensured by MIGA and similar tools and therefore provides protection against government adverse action.	Operating under an issued license typically requires less time and administrative effort from all sides (regulator and developer), so it might be well adapted to small projects. The issued license proposed here may also qualify for MIGA, though it is less favourable compared to agreements.
Challenges/ weaknesses	Risk of misalignment in construction timelines between publicly owned assets and privately owned assets; Complex agreements between all parties required; Higher risk to the developer for defects or quality issues with respect to government-owned assets; Higher tariffs may create political and customer issues	Signing a concession agreement typically involves significant administrative effort. It might therefore slow down projects. Concession agreements are more difficult to extend at the end of their term due to concessionaire performance reviews, changes in public interest and/or in law.	Signing a Minigrid Project Agreement typically involves significant administrative effort. It might therefore slow down projects.	The use of an issued license, rather than concessions or Minigrid Project Agreements, may not provide the same protection against some of the key risks, especially if it does not provide a long-term exclusivity period or license tenure
Cost implications	Moderate CAPEX grant requirements for public sector (≈500-700 USD/connection). Moderate (but higher than grid) tariffs for consumers (≈0.30-0.50 USD/kWh).

The original IFC template can be found here.

The original regulations for mini-grids template can be found here.

Scenarios 3 and 6, for which the IFC template was used, do not currently include sub-options.