Kenya's electric vehicle (EV) sector received a substantial boost this week following a series of announcements from the U.S. International Development Finance Corporation (DFC).
The DFC has injected $20 million (Ksh4 billion) in direct loans to three key players in the Kenyan e-mobility industry, aiming to accelerate the adoption of electric vehicles and expand infrastructure development.
BasiGo, a prominent e-mobility company in Kenya, is one of the primary beneficiaries, securing a $10 million (about Ksh1.33 billion) loan.
This funding is earmarked for the procurement of electric buses and batteries, essential components for their e-mobility projects.
The company has been at the forefront of the EV revolution in Kenya, and this financial injection is expected to enhance its capacity to deliver more electric buses to the country's public transport system.
Similarly, Roam, another significant player in the e-mobility sector, has received a $10 million (about Ksh1.33 billion) loan.
Roam's focus is on the design and development of electric motorcycles and buses, along with the establishment of charging stations throughout Kenya.
This initiative is poised to support the country's shift towards sustainable and eco-friendly transportation solutions, particularly in urban areas where pollution from internal combustion engine (ICE) vehicles is a growing concern.
Mogo Auto Kenya, a financial company specialising in car loans, is the third beneficiary of the DFC's funding initiative.
Mogo has been granted a $10 million (about Ksh1.33 billion) loan to expand access to affordable car loans, motorcycle taxi financing, and logbook loans.
This move is anticipated to make EVs more accessible to a broader segment of the Kenyan population, promoting the adoption of greener transportation options.
In addition to these significant financial commitments, the U.S. Department of State has pledged $100,000 (about Ksh13.25 million) in technical assistance to support Kenya’s transition to zero-emission vehicles (ZEVs).
This support will focus on policy development and implementation, capacity building, peer-to-peer learning initiatives, and workforce development programs, further bolstering the country’s e-mobility framework.
Moreover, the U.S. and Kenya have jointly committed to enhancing Nairobi's transportation infrastructure with a $60 million (about Ksh8 billion) grant aimed at improving mobility and promoting eco-friendly public transport.
This four-year project will prioritise safe options for pedestrians and the development of sustainable public transport systems, making Nairobi a greener and more mobile city.
“With this week’s announcements, DFC is doubling down on its commitments to Kenya’s development, with investments into energy, e-mobility, and infrastructure,
"DFC is also expanding its on-the-ground presence by opening an office to help us better pursue opportunities across the region,” said Scott Nathan, CEO of DFC.
As of December 2023, the number of registered EVs in Kenya stood at 3,753, a figure attributed to several incentives introduced by the government to promote e-mobility.
Analysts and industry insiders predict that by 2040, electric vehicles will comprise more than 50 per cent of car sales in the country.
Furthermore, EVs are expected to reach price parity with ICE vehicles between 2025 and 2030, making them a more viable option for many consumers.
