Electrifying Addis Ababa The Future of Public Transport is Greener

Addis Ababa, Ethiopia’s capital, is embracing a transportation revolution by introducing electric buses and minibuses; th e future s e ems greener for Addis. This shift promises a more sustainable and efficient public transport system, potentially reducing traffic congestion and pollution. The large-scale electric vehicle (EV) import and local assembly plan presents challenges and opportunities. EBR’s Eden Teshome writes that this future envisions EVs coexisting with traditional taxis and minibuses, ultimately improving commutes and promoting a more sustainable urban environment.

Hannan Elias, a daily commuter in Addis Ababa, is among many residents who face frustration and fatigue due to the inconveniences of the existing public transportation system. Hannan, who relies heavily on public transport, often runs late, which causes problems at her workplace and adds unnecessary stress to her daily routine. This struggle is not unique to Hannan but resonates with numerous individuals in Addis Ababa.

Ethiopia, recognizing the need to prioritize sustainability in the transport sector, has set ambitious goals to import 439,000 electric vehicles as part of its sustainability policies. In 2023 alone, the country spent nearly USD 6 billion on importing fossil fuels, with a significant portion of that spending allocated to fuel vehicles. In response to this pressing issue, the Transport and Logistics Ministry brought into service over 30 electric buses in Addis Ababa on April 10, 2024.

These newly commissioned buses prioritize passenger comfort and environmental responsibility, offering a sustainable solution in contrast to traditional fossil fuel-powered counterparts. With an impressive range of up to 370 kilometres on a single charge, these buses are labelled “100% electric, zero CO₂,” signifying a significant stride towards emissions reduction and the fight against climate change.

“I am hopeful that these new beginnings, such as the introduction of electric public transports, will bring about positive changes. I believe that with more efficient and reliable transportation options, my commuting experience will improve, and I can finally bid farewell to the constant struggle of being late. I eagerly look forward to the potential solutions these advancements can provide.” Hannan shares her hope.

For countries like Ethiopia, whose main chunk of foreign exchange reserves are spent on fuel imports, the benefits of EVs are hard to ignore. Ethiopia spends billions to import fuel annually. On the contrary, electricity is cheap in the country and abundant to the point of being exported. Demand for vehicles is high in Ethiopia as the nation looks destined to grow out of the classification of having the world’s lowest car population per capita—a total of 1.1 million vehicles transverse the country, half of which are located in the capital. Small cars account for around 219,699 of the total number. Despite Ethiopia’s energy potential, the nation is battling energy shortages and load shedding as it tries to service a population of over 120 million people and an ever-rising demand for electricity, which climbs almost 30 % yearly. Around 4,800 MW is generated and has been recently augmented with 375 MW from one turbine of the much-anticipated Great Ethiopian Renaissance Dam (GERD), the country’s giant hydroelectric power production facility. However, the nation’s requirement thus far is only 2,900MW.

“There is enough supply into the national grid,” says Moges Mekonen, Communications Director at Ethiopian Electric Power. So, if anyone asks for additional electric power, we can offer it,” he told EBR.

Furthermore, introducing electric vehicles presents a unique opportunity to democratize access to transportation. Electric cars, though considered expensive, can be made more affordable through legislative measures aimed at reducing taxes on imports. In line with the 2021- 2030 Green Development Master Plan approved by parliament in December 2023, the Ethiopian authorities are preparing legislation to ease taxes on electric vehicle imports, including a proposed 15% reduction in customs duties.

The impact of this transportation revolution extends beyond environmental considerations and affordability. Introducing electric minibuses and buses will undoubtedly affect the existing taxi and minibus operators, who form a crucial part of the city’s transportation ecosystem. These traditional operators may face increased competition from modern electric vehicles, which offer a more comfortable and environmentally friendly alternative.

Belayneh Amare shares his concern with EBR as a traditional taxi driver: “Driving my rusty old Lada, the introduction of new electric public transports fills me with a sense of unease.” “While I understand the importance of sustainable transportation, I can’t help but feel threatened. The income I earn from my outdated vehicle puts food on my family’s table.” Says Belayneh. “I hope that amidst this transformation, there will be opportunities for drivers like me to adapt and continue providing for our loved ones.”

To gain insights into the experiences of other countries that have undergone similar transformations, we turn to cities worldwide that have successfully integrated electric vehicles into their transportation systems. One example is Shenzhen, a major city in southern China, which has rapidly transitioned its bus fleet to electric cars. The city’s commitment to sustainable transportation has resulted in cleaner air, reduced noise pollution, and improved passenger experience. The successful implementation of electric buses in Shenzhen can serve as an inspiration and blueprint for Addis Ababa as it navigates its transportation revolution.

Oslo, Norway, is another city that has made significant strides in electric transportation. Through incentives, infrastructure development, and supportive policies, Oslo has become a global leader in electric mobility. The city’s comprehensive charging network, coupled with financial incentives such as exemption from road tolls and reduced parking fees, has encouraged the widespread adoption of electric vehicles.

While drawing lessons from these international experiences is valuable, it is essential to recognize that each city has unique circumstances and challenges. Addis Ababa needs to tailor its approach to suit its specific needs, considering factors such as infrastructure requirements, financial considerations, and the preferences and behaviours of its residents.

The future of public transport in Addis Ababa is bright, with the introduction of electric minibuses and buses paving the way for a more sustainable and efficient transportation network. The shift towards electric vehicles presents an opportunity to reduce pollution, decrease dependence on fossil fuels, and create a more inclusive and accessible public transport system. However, this transformation also challenges traditional taxi and minibus operators, who must adapt to the changing landscape. By learning from the experiences of other cities and considering the needs of all stakeholders, Addis Ababa can build a public transport system that meets the evolving needs of its residents while contributing to a greener and more sustainable future. As city authorities and regulations evolve, the tax relief provided for the electric vehicle sector highlights the commitment of the Ethiopian government to promote sustainable transportation and create a favourable environment for the growth of electric vehicles.

Bero Hussein, the State minister for Transport and Logistics, disclosed, “When one imports components to assemble EVs within the country, the tax is zero. If the cars are semi-assembled, then the tax is 5%. If the car is fully assembled, the vehicle has a 15% taxation requirement. Comparing all this with the conventional vehicle taxation regimes shows the figures are free. It’s a big tax relief for the sector.”

Reducing taxes on electric vehicle imports demonstrates the government’s commitment to promoting sustainable transportation and making electric vehicles more accessible to the general population. By creating a favourable economic environment, Ethiopia aims to import at least 152,800 electric cars over the next ten years, bridging the gap between the high demand for transportation and the limited number of vehicles in the city.

The future of public transport in Addis Ababa holds immense potential in terms of environmental sustainability and transforming commuters’ daily lives. Electric vehicles offer a reliable and efficient mode of transportation that can alleviate congestion, reduce pollution, and provide passengers with a comfortable and seamless travel experience. Introducing electric minibuses and buses is a significant step in realizing these goals.

As Addis Ababa embarks on this transportation revolution, it needs to navigate the challenges and opportunities that arise. Traditional taxi and minibus operators, who have long been integral to the city’s transportation system, may face increased competition from modern electric vehicles. Addressing their concerns and ensuring a smooth transition for their adaptation and integration into the evolving transport landscape is crucial.

To achieve this, stakeholders must engage in open dialogue and collaboration. The experiences of Shenzhen and Oslo, cities that have successfully integrated electric vehicles into their transportation systems, , offer valuable insights and lessons for Addis Ababa. Addis Ababa can learn from its strategies, adapt them to its unique context, and develop solutions that best suit the city’s needs.

Infrastructure development is another critical aspect that requires attention. Establishing a robust charging network is crucial to support the widespread adoption of electric vehicles. This infrastructure should be strategically located, easily accessible, and capable of meeting the growing demand for charging stations. By investing in charging infrastructure, Addis Ababa can alleviate concerns about range anxiety and ensure that electric vehicle users have a reliable means of charging their vehicles.

Public awareness and education also play a vital role in fostering acceptance and adoption of electric vehicles. Informing the public about the benefits of electric transportation, dispelling misconceptions, and highlighting the positive impact on the environment can encourage individuals to embrace this sustainable mode of transportation. Public campaigns, incentives, and educational programs can all contribute to shaping a positive perception of electric vehicles among residents.

While challenges exist, such as the need to address the concerns of traditional transport operators and develop the necessary infrastructure, the opportunities for a more sustainable, efficient, and inclusive public transport system are vast.

By learning from the experiences of other cities, tailoring strategies to local circumstances, and fostering collaboration among stakeholders, Addis Ababa can create a transportation network that meets the evolving needs of its residents. The city has the potential to become a leading example of sustainable urban mobility, where electric vehicles and traditional transport operators coexist, benefiting both commuters and the environment. Through these efforts, Addis Ababa can pave the way for a greener and more sustainable future for its residents and inspire other cities across the globe. EBR

12th Year • May 2024 • No. 129

Eden Teshome

Editor-in-Chief of Ethiopian Business Review (EBR). She can be reached at eden.teshome@ethiopianbusinessreview.net

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