Energy access is fundamental to development and unlocking social and economic opportunities. Across many Low- and Middle-Income Countries (LMICs), particularly in Sub-Saharan Africa and South Asia, where weak grids or insufficient generating capacity lead to frequent black or brownouts, fossil fuel generators (FFGs) have come to be relied upon by millions as the most or only source of reliable electricity. It is estimated that in 17 countries across Africa, diesel generator capacity outstrips on-grid power capacity1.
The negative impacts of FFGs are well documented, as are the range of policy and regulatory interventions aimed at reducing or displacing them. Despite this, fossil fuel generators are still highly prevalent, and in Africa, the FFG market is expected to grow from USD 6.7bn in 2024 to over USD 11.5bn by 20332.
Why have fossil fuel generators become so prevalent?
The root cause of FFG usage is an inability to access grid-scale electricity, either through an absence of networks (i.e. off-grid communities) and connections or through unreliability of delivery. Given the importance of power across domestic, industrial, and public sectors as an enabler of economic activity and driver of human development, FFGs have emerged as a solution.
Price controls or subsidies on fossil fuels have served to artificially lower the running costs of FFGs across many countries. While the case can be made that this has protected consumers against rising prices and enabled millions of people to benefit from FFG-supplied electricity, prolonged usage has led to market distortions and a drain on government expenditure and investment capacity. Notably, as FFG alternatives such as solar and battery systems have become increasingly viable and available, switching to them is disincentivised via the lowering of FFG running costs.
The supporting ecosystem and economy that has emerged around FFGs also serves to perpetuate their usage, with a wide array of sellers, resellers, mechanics, supply chains, and installers that make buying, installing, and often disposing of a fossil fuel generator cheap and easy – again, disincentivising a switch to a renewable alternative. Social attitudes vary across countries but FFGs are sometimes seen as symbols of status or wealth3, adding another barrier to switching. This ecosystem becomes self-reinforcing and difficult to disrupt without addressing the root cause.
Why does reducing fossil fuel generator use through policy remain such a challenge?
Embedded policies such as fossil fuel subsidies often counteract any efforts to transition away from FFGs if not effectively addressed. Fossil fuel subsidies artificially lower the running costs of FFGs and distort market competitiveness, rendering incentives or supportive policies for renewable alternatives ineffective. While such subsidies have historically been justified as a means of supporting energy affordability, they have also embedded a reliance on carbon-intensive energy, making the transition to renewables more difficult, as well as being a drain on public finance. Phasing out fossil fuel subsidies is therefore challenging and can be both unpopular and lead to unintended consequences, such as the rampant inflation triggered by subsidy removal in Nigeria4.
In the majority of countries, interventions do not aim to directly reduce the number or usage of FFGs, with notable exceptions in Nigeria and India. Rather, interventions are typically aimed at increasing the deployment of renewable alternatives in order to displace FFGs. Ensuring an alternative is available and attractive before banning something is good policy, but signalling the phase-out of the incumbent technology is necessary to give clarity to industry and consumers.
The enforcement of existing supportive polices and/or regulations is a significant determining factor in their success. A policy may be well designed with clear definition and goals, but if it is not effectively enforced, it will struggle to achieve those goals. Product standards, for example, may be strict and well-constructed; however, lack of enforcement by the relevant authority can allow poor-quality products to enter the market, in turn reducing customer trust. In India, a strict air-quality management system introduced to limit FFG usage has been undermined by weak enforcement5.
Policy churn and uncertainty can deter investment and decision-making. The absence of policy signals can create an uncertain environment for investors and consumers alike. Policy churn – where governments make frequent changes to policy – is even more likely to deter investors looking for certainty in market rules. In Kenya, VAT on stand-alone solar products has flipped from exemption to reapplication several times, in spite of a national electrification strategy.
The dominance of fossil fuel companies in many regions affords them a significant level of political influence, in particular where fossil fuel exports contribute significantly to national revenues. Policy capture can seriously hinder the enthusiasm and quality of efforts and policies to increase the adoption of renewable alternatives.
Where next for fossil fuel generator policy?
It is clear from the experiences of ZE-Gen countries that there is no one-size-fits all policy solution to end FFG use. The complexity of the ecosystem that drives FFG use will differ from country to country and policy solutions will need to be tailored accordingly. However, there are a number of common factors that can and should be considered:
- Policy coherence is critical to success. If policies to support FFG use remain in place, then those to promote alternatives are unlikely to succeed.
- Effective enforcement must be built into policy design. This is particularly true where policies seek to deter use of FFGs.
- Policy that addresses multiple elements of the ecosystem will have a greater chance of success. A single-pronged policy approach may not be sufficient in a complex system.
Policy clearly has a pivotal role to play in the transition away from fossil fuel generators to cleaner, healthier alternatives. Much has been done to make those alternatives available and attractive, but the next steps towards FFG phase-out will require comprehensive policy reforms and the political courage to see them through. Only through a holistic and well-enforced policy approach can lasting progress towards cleaner energy solutions be achieved.
- Lawrie, C. & Stubenberg, C. (2025) ‘Friend or foe? Diesel generators and the global energy transition’, Energy Research & Social Science, 126 ↩︎
- Africa Diesel Generator Market Size & Share, 2033 ↩︎
- Consumer campaigns launched to boost solar generators in Africa – ZE-Gen ↩︎
- Inflation in Nigeria is still climbing while it has slowed globally: here’s why ↩︎
- The Critical Role of Policy Enforcement in Achieving Health, Air Quality, and Climate Benefits from India’s Clean Electricity Transition | Environmental Science & Technology ↩︎