Prototype on Bulk Procurement – Mini-Grid Innovation Lab

The Bulk procurement prototype was funded by the Rockefeller Foundation, Shell Foundation, and the Foreign Commonwealth Development Office (FCDO) and executed in collaboration with Odyssey Energy Solutions. The prototype also involved 6 mini-grid developers in Nigeria.

The bulk procurement prototype aimed to assess the cost-saving potential of consolidating mini-grid component orders. Through aggregation, CrossBoundary’s Mini-Grid Innovation Lab hypothesized that we could achieve a 10% reduction in component costs, revolutionizing Capital Expenditures (CAPEX) in the mini-grid business model. We collaborated with mini-grid developers to standardize component needs, negotiated bulk rates with manufacturers, and rigorously tested the impact on grid economics. Mini-grids are an essential part of the energy solution in developing economies like Nigeria, yet high CAPEX continues to be a significant barrier to their widespread adoption. Bulk procurement stands as a potential breakthrough, leveraging economies of scale to make mini-grid projects more financially viable.

The Mini-Grid Innovation Lab’s prototype involved the following:

Prototype Ideation and Design: Organized user-centered design workshops with mini-grid developers to understand their component needs and plan for aggregation.

Approval: Crafted a comprehensive study contract, budget, and implementation plan, gaining approval from the funder’s board for prototype execution.

Launch and Follow-Up: Rolled out the prototype in collaboration with the procurement partner, keeping regular touchpoints to track progress until the components were delivered and study data collected.

Analysis and Publication: Scrutinized the collected data to validate or refute our initial hypotheses, and collaborated with study partners to publish the results, contributing valuable insights to the broader mini-grid and renewable energy sector.

Download the results of the bulk procurement prototype.