In a significant step toward expanding energy access in Madagascar, the first grant contract under the Digital and Energy Connectivity for Inclusion in Madagascar (DECIM) Fund has been signed with Jiro Kanto, a key player in rural electrification around the Lake Alaotra region of Madagascar.

The agreement will support the development of a hydropower mini-grid in Maheriara, Ambatondrazaka, a town in the Alaotra-Mangoro region, connecting 18,500 people to electricity for the first time.

The DECIM Fund is part of the national DECIM Project, led by the Malagasy Government and financed by the World Bank, with implementation support from the Ministry of Energy and Hydrocarbons and the Ministry of Digital Development, Posts and Telecommunications. The Fund is managed by BCP, a subsidiary of Palladium, and aims to expand off-grid energy access and affordable digital solutions across Madagascar.

Madagascar faces one of the most severe energy access challenges in the world. According to the World Bank, only about 36% of the population has access to electricity, with rural areas particularly underserved, only 11%. The lack of reliable power hinders economic development, limits access to healthcare and education, and exacerbates poverty. Climate change further compounds these issues, increasing the urgency for resilient and sustainable energy solutions.

The DECIM Fund was created to address these challenges by supporting mini-grid, and solar home system developers, as well as providers of affordable digital solutions, through a mix of grants and results-based financing. Its goal is to unlock private sector innovation and scale up renewable energy infrastructure in remote communities.

“This first grant marks the beginning of a new era for energy access in Madagascar,” says Llyr Rowlands, Palladium COO. “By enabling local developers to build clean energy systems, we’re not only lighting homes—we’re powering opportunity.”

The Maheriara project will provide electricity to homes, schools, health centers, and small businesses, creating new possibilities for education, healthcare, and economic activity. This hydropower mini-grid is expected to serve as a blueprint for future projects supported by the DECIM Fund.

The Fund builds on the success of the Off-Grid Market Development Fund (OMDF), a previous initiative managed by BCP and supported by the World Bank. Between 2019 and 2023, OMDF helped over 100,000 households gain access to electricity through solar home systems. DECIM expands on this model by targeting both household and community-level energy solutions.

The fund’s launch in January 2025 was marked by a high-level event in Antananarivo, attended by government officials, development partners, and private sector stakeholders. The event highlighted the importance of public-private collaboration in achieving Madagascar’s goal of universal energy access by 2030.

While the signing of the first grant is a milestone, Rowlands emphasises that it is only the beginning. “The DECIM Fund aims to support dozens of projects across the country, reaching hundreds of thousands of people and contributing to Madagascar’s climate resilience and sustainable development.”

As construction begins in Maheriara, the spotlight is on how decentralised energy solutions can transform lives in one of the world’s most energy-poor nations. With continued support and investment, the DECIM Fund could be a game-changer for Madagascar’s energy future.