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18 August 2024

Ethiopia Leads The Way With Electric Vehicle Adoption

Fuel shortages and innovative policies drive rapid growth of electric vehicles as the country transitions to greener transportation

Electric vehicles (EVs) are rapidly gaining traction in Ethiopia, following shifts triggered by recent fuel shortages and soaring petrol prices. This evolution is most visible on the streets of Addis Ababa, where EVs are becoming more prominent alternatives to traditional gas-powered cars.

Mikial Belayneh, an Addis resident and proud EV driver, exemplifies this shift: "I no longer line up for petrol on the road," he says. His imported Toyota bZ4X boasts enough charge for two days of driving, highlighting the convenience of EV ownership amid the fuel crisis.

Current estimates suggest there are around 100,000 EVs on Ethiopian roads, with expectations for substantial growth. The Ethiopian government foresees this number increasing to more than four times its current figure by 2032.

A key driver of this transformation occurred when the government implemented a ban on all gas-powered passenger vehicle imports earlier this year. Ethiopia became the first nation globally to take such drastic measures, aiming to reduce reliance on fossil fuels entirely.

Accompanying this ban was the reduction of customs taxes on EV imports, which decreased from up to 200% on gas vehicles to just 15% for fully assembled EVs. This tax reform has made EVs significantly more accessible for many Ethiopians.

According to government officials, the drive toward electrification is not solely eco-driven; it also addresses financial constraints. With importing fuel being costly, leveraging the country's abundant hydropower resources offers both economic and environmental benefits, as 96% of Ethiopia's electricity is derived from clean sources.

Jane Akumu, representing the United Nations Environment Programme, remarked, "They really are a clean-energy country. Why are you importing oil when you have local electricity to use for your vehicles?"

Even though the government's aggressive stance on banning gas vehicles took many regional leaders by surprise, it signals Ethiopia's resolve to champion environmental policies. This decisive action could set precedents for other countries battling similar energy issues.

According to transportation advisor, Hagos, officials recognize the potential of local renewable energy sources. Historical efficiency advancements, such as the early 2000s ban on leaded gasoline, demonstrate Ethiopia's capacity for swift policy implementation.

Currently, car ownership remains relatively low, with only about 1.2 million cars on the road or roughly one for every 1,000 individuals. Comparatively, the U.S. boasts more than 270 million registered vehicles, equaling over 91% of households owning at least one car.

Despite progress, the purchase price of EVs remains prohibitive for many Ethiopians. Iman Abubaker from the World Resources Institute notes, "The market is mainly attracting high-income groups" due to the steep costs associated with electric vehicle ownership.

This has led to advocacy for greater investment in public EV transportation, which would facilitate access for citizens across all income levels. The Ethiopian government aims to rectify this by promoting the introduction of electric buses and leveraging existing infrastructure.

A reported increase of nearly 10% of EVs within two years showcases the nation's commitment, aligning with the ambitious goal of introducing over 100,000 units by 2032. Hagos, for his part, expressed satisfaction with the transition pace, emphasizing the government's dedication to reducing climate and pollution impacts.

Interestingly, Ethiopia stands alone with its comprehensive ban on importing gasoline vehicles, with the rest of Africa moving slower on electrification alternatives. But even without such stringent measures, other African nations are witnessing notable growth rates for electric vehicles.

For example, electric motorbikes are becoming increasingly popular in Nairobi, Kenya. Following the government offering tax incentives, the number of electric motorbikes surged by 500%, showcasing the continent's growing appetite for cleaner technologies.

Ethiopian authorities have already begun tightening regulations on fuel-run motorbikes, which are now required to transition to electric models. This includes introducing the city’s inaugural fleet of electric buses, marking significant strides toward cleaner public transportation.

Notably, the focus is not just on private EV ownership but extends to restructuring the public transit sector significantly. Plans for transitioning gas-powered vehicles to electric options reflect the government’s holistic approach to electrification.

While the Ethiopian EV scenario is unique, it’s pivotal to acknowledge the role of infrastructural investment and subsidies necessary to encourage wider adoption. Insights from industry leaders reinforce the idea of EV proliferation mirroring the mobile phone market explosion seen 30 years ago.

Moses Nderitu from electric bus company BasiGo stated, "I look at electric vehicles exactly as we looked at the mobile telephone market 30 years ago." He emphasized the importance of leading with innovation and creating the required infrastructure for widespread adoption.

Despite the challenging terrain of environmental policies and electric vehicle adoption, the efforts made by the Ethiopian government represent progress toward the future of sustainable transport. A commitment to prioritizing cleaner energy sources reflects broader goals to alleviate economic dependency on fuel imports, making it clear Ethiopia is ready to lead the way.

The momentum around EV adoption demonstrates not just shifts within Ethiopia but also sets the stage for other nations contemplating similar transitions. By leveraging local resources and financial reforms, it is possible to cultivate progress toward sustainable transport solutions, inspiring wider regional action.

Ethiopia's approach could inspire change within several developing nations cheekily observing the electric vehicle phenomenon. The commitment to EV policies and renewable energy adoption heralds hope for the future — one where cleaner, cheaper transportation can thrive.

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