Africa: PAYGo boom powers off-grid solar energy growth

Across Africa, PAYGo sales of solar energy kits (SEKs), which include lanterns, multi-light systems and home systems, surged 54% year-on-year

Data from the latest GOGLA Semi-Annual Global Off-Grid Solar Market Report shows record PAYGo product sales across Sub-Saharan Africa – driven by new financing models, rising consumer demand for bundled solar home systems, and subsidy-backed growth in East and West Africa.

Across the continent, PAYGo sales of solar energy kits (SEKs), which include lanterns, multi-light systems and home systems, surged 54% year-on-year to a record 2.35 million units in the first half of 2025.

For the first time since before the pandemic, PAYGo systems now represent the majority of off-grid solar sales.

This growth was underpinned by rising demand for multi-light and small home systems (11–20Wp), which are increasingly sold with fans, TVs and other appliances – and supported by flexible payment plans that spread costs for lower-income households.

However, overall market growth remained flat, up only 1% compared to 2024, as cash sales fell sharply by 35% to 1.44 million units – their lowest level since COVID-19.

The drop in cash sales, mainly of smaller lanterns and basic kits, raises concerns about affordability and access for last-mile consumers who depend on entry-level solutions.

Industry players attribute the slowdown to the conclusion or transition of major donor-backed programmes and delayed new funding rounds, which have also affected demand in humanitarian markets.

East Africa: Subsidies driving rapid growth in Uganda and Tanzania

East Africa’s off-grid solar market mirrored continental trends – PAYGo sales are surging, but total volumes are flat due to a sharp drop in cash purchases. Still, several markets are seeing rapid expansion driven by targeted subsidies and financing interventions.

Uganda’s off-grid market recorded one of the continent’s strongest performances, with SEK sales more than doubling year-on-year and growing nearly 60% compared to late 2024.

This expansion is largely linked to the World Bank-funded Electricity Access Scale-Up Programme (EASP), which has also spurred record solar water pump sales of nearly 1,200 units.

Tanzania also saw SEK sales more than double year-on-year, with appliance sales – particularly TVs – up 39%. The market continues to grow steadily in off-grid and weak-grid areas as firms 

In Madagascar, sales climbed 56% year-on-year, supported by ongoing funding from the Off-Grid Market Development Fund and the new Digital and Energy Connectivity for Inclusion in Madagascar (DECIM) programme. Malawi’s market also expanded 49%, aided by the Ngwee Ngwee Ngwee Fund.

Kenya, the region’s most mature market, remains stable, with PAYGo and cash sales holding steady. TV sales show early signs of recovery after stagnation.

However, several East African markets are in transition.

Ethiopia’s SEK sales plunged 66% year-on-year after a 2024 boom, while Rwanda’s fell 91% as it moved from the Renewable Energy Fund to a new World Bank ASCENT subsidy programme, temporarily disrupting supply.

Mozambique’s sales dropped 63% as the BRILHO programme wound down and new funding under the Mais Energia Fund only began in April.

West Africa: Nigeria anchors PAYGo expansion

In West Africa, PAYGo sales rose 22% year-on-year, driven by Nigeria’s strengthening market. The region is showing signs of renewed growth after a slowdown in 2024, though cash sales continue to decline.

Nigeria remains the anchor of West Africa’s off-grid solar sector. Sales of SEKs rose 33% year-on-year, boosted by the rollout of the World Bank-supported Distributed Access through Renewable Energy Scale-up (DARES) programme.

The initiative follows the success of the earlier Nigeria Electrification Project (NEP), which built much of the country’s PAYGo market foundation between 2019 and 2023.

Appliance sales in West Africa grew 27% year-on-year, with fan sales leading the charge – particularly in Nigeria, where rising temperatures and frequent bundling with solar home systems are driving demand.

Fan sales now represent the main source of appliance growth in Sub-Saharan Africa, overtaking TVs, which dominated earlier in Kenya.

Elsewhere in the region, Burkina Faso’s SEK sales collapsed by 83% following new import regulations requiring local sourcing of solar panels – a policy shift that has constrained supply.

Subsidies and sustainability

GOGLA notes that subsidies have become the primary growth driver across SSA, propelling PAYGo expansion but also exposing markets to volatility when funding cycles shift. The group warns that sustainable design and clear exit strategies are essential to ensure continuity once external support ends.

Despite uneven trends, the data confirms that PAYGo innovation is transforming access to energy across Africa.

Cover photo:  yourapechkin©123rf.com