A new charge provider enters Uganda

From the newsletter

Electrify Africa, a new electric vehicle charging provider, officially launched its operations yesterday in Kampala, Uganda. The company's business model enables individuals to become charging providers and monetise their investment through an app that connects them with EV drivers seeking charging services.

• The business model is unique. Most charge providers have focused on linking their customers to publicly available chargers rather than privately owned ones.

• Uganda's EV charging space is still nascent; there are just over 30 DC fast chargers, over 150 battery swapping stations, and 5 public charging stations.

More details

• The Ugandan government, in its National E-Mobility Strategy, plans to have chargers every 50 km on its highways. The Ministry of Energy and Mineral Development is currently working on a Charging Station Master Plan and EV Charging guidelines to provide more needed structure for the sector. The market, though, has very few charging infrastructure providers. They include Altec and Total Energies, and e-bus companies like Kiira Motors and FreedomEV, which are building their own charging infrastructure.  

• Electrify Africa is providing several EV charging solutions, including both home and commercial EV chargers. The price range starts at about $3,000. EV charging infrastructure providers in Uganda currently benefit from the exemption of import duties and VAT, which makes them affordable.

• Ugandans are slowly adopting EVs, with just over 3,300 EVs in the market, over 95% of which are electric motorcycles. The high cost makes EVs unaffordable to many. However, the benefits of using them for commercial purposes, particularly electric motorcycles, make them attractive for riders who save up to 40% on operation costs.  

• Several financing companies in Uganda, such as Mogo Uganda, Asaak, and Watu Credit, are making electric motorcycles more accessible by offering riders affordable financing options. However, due to the high cost of batteries, most riders opt to lease them instead of purchasing them outright. This reliance on battery leasing has led to a growing dependence on battery swapping as the primary method for recharging.

• The market, however, is picking up. Total Energies last month entered the charging space by establishing the first public charging station for EVs at its fuel station and plans to install more. In the battery-swapping space, Yongeza Capital launched four battery-swapping stations for Spiro. In October, Uganda launched its e-mobility association, which plans to be an advocate for better government policies and a platform for industry players to connect.

•  What is more interesting in the sector is that charge providers are opting to digitalise their business through mobile apps. This allows their users to locate nearby EV charging stations, pay for charging, and keep track of their energy consumption.

Our take

• Electrify Africa's business model has the potential to be a game-changer in the EV space. By allowing EV users to easily locate both individual and commercial charging stations through their app, it eliminates range anxiety for EV drivers. However, the lack of pricing regulations for charging services could present challenges and needs to be addressed for the model to function smoothly.   

• Home charging for electric motorcycle riders can potentially lower operational costs, as the users pay the regular electricity tariff rather than the cost of a swap, which includes battery depreciation and station-related costs. 

• The use of an app benefits both companies and consumers. It allows charging providers to assess demand, plan accordingly, and monitor revenue. For consumers, it provides an easy way to track energy consumption and charging expenses, which can be useful in comparing EV charging costs with fuel costs.