Key messages from the report
- A set of “game changing” business models, approaches, and support mechanisms is needed to 1) improve the commercial viability of the industry, 2) enable OGS companies to scale up provision of first-time access, 3) help the industry move beyond traditional PAYG models when serving hard-to-reach groups, and 4) accelerate the uptake of OGS for productive use and social infrastructure.
- Many such game changers were already identified in the previous edition of this report; a few new additions include 1) impact-linked concessional finance and tailored financing instruments for smaller companies and 2) some positive developments on existing game changers, such as local currency and off-balance-sheet financing.
- Game changers for improving commercial viability include improved repayment rates, higher-margin products, off-balance-sheet and local currency financing, tailored financing instruments for smaller companies, and technical assistance.
- Game changers for supporting first-time access include availability of public funding, impact-linked concessional financing, multi-country financing facilities, upfront grants, and partnerships in humanitarian settings.
- To move beyond PAYG, new forms of public-private partnerships (PPPs) could be a game changer.
- Game changers to accelerate the productive use of energy (PUE) include technological innovation and demand aggregation mechanisms; social infrastructure game changers include long-term service contracts and de-risking instruments.
We are not on track to achieve SDG 7, but it is not out of reach
Addressing key barriers such as low affordability, narrow company margins, limited access to capital, high costs to enter remote settings, and high levels of perceived risk can drive first-time access and accelerate the pace toward SDG 7.
Achieving SDG 7 requires game changers that can 1) improve the commercial viability of the industry, 2) enable OGS companies to scale up provision of first-time access, 3) support the industry in moving beyond traditional PAYG models when serving hard-to-reach groups, and 4) accelerate the uptake of OGS for productive use and social infrastructure.
Several game changers have increased in likelihood or impact since the 2022 MTR —including local currency financing, off-balance-sheet financing, and increased availability of subsidies. OGS companies are increasingly able to obtain local currency financing aligned with the currency of their receivables. A few companies have also been able to tap into off-balance-sheet financing through securitization. The entire sector is benefiting from increasing availability of subsidies, on both the supply and consumer sides, as well as impact-linked concessional financing.
Explore the game changers needed to achieve SDG 7
Explore what constitutes a game changer for the OGS sector, how some of them have changed since the last MTR, and what some potential game changers for the sector moving forward could be.
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