Written By: Faith Jemosop
As Africa continues its urgent push to achieve universal energy access, a quiet but potentially transformative model is gaining traction: energy cooperatives. These are community-owned and managed energy systems that have delivered impressive results in Latin America and parts of Asia. Now, Africa is beginning to explore whether this grassroots approach could be the key to decentralizing energy and democratizing power literally and figuratively.
What Are Energy Cooperatives?
Energy cooperatives are member-owned organizations that generate, distribute, and manage electricity for a defined community. Unlike traditional private or state utilities, co-ops are run by the people who use the electricity residents, businesses, or local institutions giving them direct control over decisions, pricing, and profits. Each member typically has one vote, ensuring democratic governance regardless of the amount of energy consumed.
The model is already well-established elsewhere. In Germany, nearly half of the country’s renewable energy capacity is citizen-owned, much of it through cooperatives. In Bangladesh, solar energy co-ops have empowered remote rural communities, while in Latin America, co-ops have delivered power to millions of people in regions unreachable by national grids.
How Energy Cooperatives Differ from Government or Private Utilities
Traditional energy provision in Africa is often centralized, urban-focused, and driven either by state-owned utilities or large private investors. These systems typically lack the flexibility to reach the estimated 600 million Africans who still live without electricity mostly in rural or peri-urban areas. National utilities often prioritize profit, city infrastructure, or political considerations over community needs.
Energy cooperatives, on the other hand, are local, inclusive, and non-profit-oriented. Because they are owned by those they serve, co-ops tend to reinvest profits into expanding services, reducing costs, or upgrading infrastructure rather than remitting them to foreign investors or government accounts. This difference is especially important in rural Africa, where public trust in both government and private entities may be low.
Why Cooperatives Fit Off-Grid African Villages
The potential for energy cooperatives in Africa is strongest in off-grid and underserved rural communities. In places where building large grid infrastructure is economically viable, mini-grids and solar home systems managed by cooperatives can fill the gap. Local ownership also builds trust, enhances sustainability, and reduces the risk of vandalism or mismanagement.
According to the International Renewable Energy Agency (IRENA), decentralized renewable energy could provide over 60% of the new electricity access needed in sub-Saharan Africa. Cooperatives can be a key vehicle for delivering this access by enabling communities to develop, finance, and manage their own power systems.
For example, a village might form a cooperative to install a solar-powered mini-grid. Each household would contribute a small membership fee, participate in governance, and share in profits. Revenue from power sales could then be used to expand the system, support local schools or clinics, or reduce electricity tariffs.
Social and Economic Benefits of Community Power
Energy cooperatives offer not just electricity, but empowerment. By involving citizens directly in energy decisions, they promote a sense of ownership and accountability. Social cohesion often increases when neighbours collaborate on shared infrastructure.
Economically, co-ops retain profits within the community. Instead of paying bills to a distant utility, households pay into a system they own that can create jobs, train local technicians, and foster entrepreneurship around energy services like refrigeration, welding, or charging stations.
Energy cooperatives can also lower energy costs. Without the need to generate shareholder profits or cover executive salaries, co-ops can offer cheaper tariffs while maintaining or even improving reliability.
Pilot Projects in South Africa
While still rare in Africa, South Africa has taken tentative steps toward energy cooperatives. In Mpumalanga and parts of the Eastern Cape, pilot projects have introduced solar mini-grids managed by community groups with cooperative-like structures. These efforts, supported by NGOs and local municipalities, show promising signs of sustainability and scalability.
One such initiative is the Sustainable Energy Africa project, which has helped small communities develop locally owned solar systems. Another is the “People Power” initiative in the Western Cape, which has trained youth to maintain solar installations and participate in energy governance.
Though challenges remain from regulatory hurdles to financing these projects offer a blueprint for wider adoption across the continent.
Policy Recommendations
For energy cooperatives to thrive in Africa, governments must rethink policy frameworks and actively support bottom-up solutions. Key recommendations include:
- Legal recognition: Many African countries lack a legal category for energy cooperatives. Enacting legislation that formally recognizes them as is done with agricultural or financial co-ops is critical.
- Access to finance: Microfinance institutions, donor agencies, and development banks should provide low-interest loans or grants targeted at community-owned energy projects.
- Technical support and training: Governments and NGOs should invest in building local capacity, ensuring communities have the skills to manage and maintain their energy systems.
- Regulatory reforms: Grid connection rules, licensing requirements, and tariff structures must be adapted to accommodate small-scale, decentralized operators.
- Public-private-community partnerships: Governments can facilitate models where communities partner with NGOs or private firms to access technology while retaining ownership and control.
Also read: How Tanzania Plans to Deliver Universal Energy Access by 2030
Africa’s energy future is often portrayed as a race for billions in foreign investment, large dams, or regional power pools. But this top-down vision risks leaving millions behind. Energy cooperatives offer a complementary bottom-up approach one rooted in local agency, economic inclusion, and democratic governance.
If supported by the right policies and financing mechanisms, co-ops could light up thousands of African villages not just with electricity, but with hope, dignity, and control over their own destinies.
