sustainability Article Renewable Minigrid Electrification in Off-Grid Rural Ghana: Exploring Households Willingness to Pay Artem Korzhenevych 1,2 and Charles Kofi Owusu 2,3, *   Citation: Korzhenevych, A.; Owusu, C.K. Renewable Minigrid Electrification in Off-Grid Rural Ghana: Exploring Households Willingness to Pay. Sustainability 2021, 13, 11711. https://doi.org/10.3390/ su132111711 Academic Editor: Alberto-Jesus Perea-Moreno Received: 30 September 2021 Accepted: 20 October 2021 Published: 23 October 2021 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). 1 Leibniz Institute of Ecological Urban and Regional Development, Weberplatz 1, 01217 Dresden, Germany; a.korzhenevych@ioer.de 2 Faculty of Business and Economics, Technische Universität Dresden, Helmholtzstr 10, 01062 Dresden, Germany 3 Kumasi Institute of Technology, Energy and Environment (KITE), Accra GA23321, Ghana * Correspondence: kofiowusuboateng@gmail.com Abstract: Renewable energy minigrids hold significant prospects for Africa’s energy sector and its economic development in general. The government of Ghana has established pilot renewable minigrids in five off-grid communities as a testing ground for the electrification of over 600 existing rural communities that cannot be electrified via the national grid. Although there is evidence on willingness to pay (WTP) values for renewable-generated electricity in some developing countries, little is known about households’ WTP for renewable-based electricity in Ghana and, in particular, about renewable minigrids for rural electrification. This paper provides one of the first WTP estimates for renewable-based electricity for rural electrification in a developing economy context such as Ghana. Using data from a contingent valuation survey undertaken in all five pilot renewable minigrid project communities, we found that rural households are willing to pay an average of 30 GHC/month (≈5 USD/month) for high-quality renewable-powered electricity services, which is twice the amount they are currently paying based on the Uniform National Tariffs. The hypothetical bias is addressed by conducting a survey among active users of the minigrids. The starting point bias is reduced by employing random starting bids. The respondents are willing to pay between 9 and 11% of their discretionary incomes to cover the cost of accessing reliable renewable-powered electricity in the rural, off-grid communities in Ghana. The paper concludes by discussing the policy implications of these findings regarding the development of tariff regulations and business models for renewable minigrids in the rural, off-grid sector. Keywords: willingness to pay; minigrids; rural electrification; renewable energy; Ghana 1. Introduction About one billion people in developing countries currently lack access to electricity, most of them living in sub-Saharan African and developing Asian countries [1,2]. A vast majority (87%) of these unelectrified households live in rural areas [2]. This challenge is specifically addressed by Goal 7 “Ensure access to affordable, reliable, sustainable and modern energy for all” of the Sustainable Development Goals [2]. Despite ongoing electrification projects in different jurisdictions, the current trend is likely to lead to an estimated 700 million people who will remain unelectrified in 2030, nearly all of them in sub-Saharan Africa [1]. Despite the economic feasibility of extending the electricity grid to under-served areas in some situations, minigrids may be better suited to address the low electrification rates and electrification challenges in areas with scattered households, low populations, and low demand potential [1,3,4]. A vast majority of the rural households without adequate elec- tricity access would be better serviced with standalone systems or minigrids [5]. Alongside the existing traditional approach of electricity grid extension, off-grid renewable energy solutions, notably, solar minigrids and standalone systems, provide a modern and scalable Sustainability 2021, 13, 11711. https://doi.org/10.3390/su132111711 https://www.mdpi.com/journal/sustainability