Uganda sees battery swap expansion

November 21, 2024

From the newsletter

Yongeza Capital, a mobility company, has partnered with Oryx Energies, an oil and gas company, to build battery swap stations for electric motorcycles in Uganda. These stations will be powered by solar energy and located at Oryx Energies fuel stations. The batteries used have a range of 80-100 km.

  • This partnership comes six months after Yongeza Capital partnered with Spiro to build battery swap stations across Uganda.

  • To date, Yongeza has built over 10 charging and battery swap stations and plans to build more charging stations across four urban areas in Uganda.

More details

  • Yongeza Capital is engaged in selling electric motorcycles and three-wheelers and has sold over 1,000 electric motorcycles in Uganda.

  • The partnership with Oryx Energies comes less than a month after another oil and gas company, TotalEnergies Uganda, built its first public charging station for electric cars, in addition to their existing private charging station, with plans to build three more by the end of 2024.

  • We are seeing a trend of partnerships between mobility companies and oil and gas companies for the utilisation of their space as charging and swapping stations. Another company, City Oil, has installed one charging station at its location near Acacia Mall in Kampala.

  • Mobility companies want to tap into the expansive network of oil and gas companies and their convenient locations, mainly along highways, to help reduce range anxiety. Oryx Energies has 25 fuel stations, City Oil has over 10 stations, and Total Energies has over 200 fuel stations across Uganda.

  • Uganda's EV market is dominated by electric motorcycles, which account for about 95% of all EVs sold. It is common across Africa's electric motorcycle markets to have battery swap stations rather than charging stations. This is mainly because most riders purchase the motorcycle without the battery and lease it from the company. 

  • Although consumers can purchase the battery, due to the high cost, the majority prefer to lease it. As such, we are seeing battery swap stations sprouting up more than charging stations for electric motorcycles. There are over 128 battery swap stations in Uganda, with a good portion in Kampala.

  • The electric motorcycle market in Africa has several key players. Zembo operates over 700 electric motorcycles and 29 battery swap stations. Gogo has a fleet of over 1,800 e-motorcycles and 66 swap stations. Spiro manages over 500 e-motorcycles and 32 swap stations. Redvers E-Mobility has around 50 retrofitted motorcycles and one swap station.

  • The government has a medium-term plan that aims to build EV charging infrastructure in all fifteen major cities in Uganda and install chargers along major roads at intervals of at least 150 km. This plan also includes increasing investment in battery swap stations to reduce range anxiety for electric motorcyclists.

  • The government is working on the National E-Mobility Strategy, which calls for 0% import duty, 0% VAT, and 0% withholding tax on original equipment manufacturer (OEM) vehicle parts, components, EV chargers, EV batteries, and other materials for electric vehicle production. The strategy also proposes an e-mobility energy tariff for public and commercial charging points.

Our take

  • Off-grid charging for batteries, particularly with solar, is becoming increasingly affordable. To circumvent the unreliable power grids common in Africa, companies are opting to build their own energy and charging networks. However, this approach has limitations, especially in urban areas where space for large-scale solar panels is limited, forcing reliance on the grid.

  • For grid-tied solutions to be viable, it needs specialised and more affordable EV tariffs. And the grid must be powered by clean energy to truly support a green EV transition. Otherwise, charging EVs might generate more pollution than using traditional fuel vehicles.

  • As technology advances, with batteries becoming cheaper and fast charging more prevalent, as seen with electric cars, electric motorcycle companies might consider diversifying their strategies. Instead of focusing solely on battery swapping, they should also invest in building charging stations.