The Project

The Government of Vanuatu, through the Department of Energy (DOE), is implementing a number of projects designed to support increased penetration of renewable energy and increased access to electricity services for rural households, public institutions and businesses located in the dispersed off-grid areas of Vanuatu. The World Bank and other development partners support and fund some of these projects.

 Strategic Framework for Scaling up Electricity Access Nationwide by 2030
Figure 1. Strategic Framework for Scaling up Electricity Access Nationwide by 2030
Source: World Bank Project Appraisal Document 9 May 2017, paragraph 25

The Vanuatu Rural Electrification Project (VREP) is a key initiative to achieve these goals and is undertaken by DOE. DOE is defined as the initiative’s Owner. VREP is being undertaken in two stages:

  • The first stage (VREP I) involves subsidizing ‘plug and play’ solar home systems (SHS) for remote dispersed rural households; and
  • The second stage of VREP (VREP II) involves extending the subsidies to:
    • larger technician-installed SHS and microgrids (component I); and
    • mini-grids (component II) starting with the development of up to five (5) mini-grids1 in rural communities of Vanuatu (the Project).

A number of communities will be selected via an endorsed selection criteria and invited by DOE to elect to host and benefit from a mini-grid under component II VREP II. As such, this is a demand-driven initiative: communities are to choose to benefit from the mini-grid systems. The Project will thus be implemented in partnership between the DOE and the recipient communities of the mini-grids. The mini grids under component II VREP II are also intended to be developed within the Environmental and Social Management Framework and the Resettlement Policy Framework prepared for DOE by the World Bank in December 2016 as part of VREP. The mini grids under component II VREP II are further intended to be developed within the World Bank’s overall Environmental and Social Safeguard Policies.


A mini-grid is a stand-alone electricity generation source and distribution network. The envisaged mini-grids are small solar / diesel hybrid systems suiaccordionle for supplying the power needs of a small rural village where the energy consumption is quite limited (c.20 to 500 customers). Based on preliminary conducted simulations, the system size is generally expected to be in the range of 30 to 80 kilowatt-peak (kWp) catering for a village with a peak load in the range of 10 kW to 50 kW (in the evening) and a daily power consumption of 150 kW to 400 kWh/day, though larger-sized systems may also be constructed. Such hybrid systems typically involves solar photovoltaics (PV) arrays, a battery bank (able to store the equivalent of one day of expected demand) and/ or a diesel genset, preferably using biodiesel from locally produced crops such as copra, to meet peak demand and restart the system, as well as an inverter device to convert the direct current (DC) power generated by the PV arrays to the local alternating current (AC) distribution network itself.

Figure 2. Typical Mini-Grid System
Source: Innovations for Sustainable Development in Mini-Grids & Gender Equality, Inclusive Design, Better Development Outcomes, Key Issues and Potential actions, The World Bank group, Climate Investment Funds, ESMAP, February 2017