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E-mobility firms in Kenya opt for solar power to cool their costs
With growing demand, e-mobility firms anticipate a rise in energy consumption, making the 15,000-kWh cap on the special tariff increasingly impractical.
A growing number of electric mobility firms in Kenya are shifting to cheaper solar solutions to cut costs of battery swap and charging services for electric vehicle (EV) users.
Electricity, the backbone of e-mobility businesses, has become a major pain point for firms, with costs reaching as high as 30 percent of operational expenses for some, despite the existence of a special tariff designed specifically for the segment.
Firms say their costs have been increasing with the rising uptake of EVs especially two-wheelers are popular among public transport operators.
Electric motorcycle firms Roam and Spiro, two of the industry’s leading players, have both now opted to use solar panels to charge batteries during the day to reduce electricity costs.
Kenya Power charges e-mobility firms a special tariff of Sh8 per kilowatt-hour during off-peak hours (between 10 pm and 6 am) when electricity usage is low, and double that rate during peak hours.
While this rate is lower than the industrial and domestic tariffs, it is capped at a maximum consumption of 15,000 kilowatt-hours (kWh) per month, which the firms argue is too low.
Spiro, which operates about 80 battery swap stations across the country, says electricity accounts for around 30 percent of its operating costs, higher than even staff expense, and that introducing solar into its energy mix will significantly ease this burden.
“Solar with energy storage can easily offset the incremental demand versus supply,” said Kaushik Burman, Spiro's chief executive officer during an interview with Business Daily.
The company is also looking to leverage the recently introduced net metering policy, which allows private firms generating excess power from renewable sources to feed it into the grid and receive credit for it.
“This will reduce the cost of input electricity for us by about 72 percent, which we will pass on to the consumers and allow us to roll out battery swap in Kenya at scale,” said Burman.
Roam Electric has just completed installation of solar panels across all of its 12 charging stations in Nairobi, reducing its reliance on the national grid by a third and cutting its charging fees by nearly half.
“Without the solar, we would be paying about 30 percent more to the utility in monthly power bills. So, by just using solar we can offset about a third of our energy costs,” said Habib Lukaya, East Africa regional operations manager at Roam.
By augmenting its energy through solar, Roam says it managed to cut its charging or swap fees from Sh250 per battery to Sh150.
Energy demand from the e-mobility sector is expected to continue rising in Kenya and globally as the adoption of electric vehicles increases.
Last year, the International Energy Agency (IEA) revealed that around 17.3 million electric cars and 10 million electric two- and three-wheelers were sold worldwide – the highest in EV history.
Two-wheelers are the most electrified form of transport globally, accounting for about nine percent of all motorbikes, according to the IEA.
In Kenya, there are about 10,000 electric two-wheelers on the road, with Spiro accounting for about 4,500 and Roam for 2,500. The shift to local assembly – which cuts costs by avoiding import duties – is expected to further drive demand.
With growing demand, e-mobility firms anticipate a rise in energy consumption, making the 15,000-kWh cap on the special tariff increasingly impractical.
“That cap has limitations. It means that you only need two buses charging on a regular basis to hit that cap. We’re also beginning to see some of these motorcycle battery swap stations hitting that cap,” noted Moses Nderitu, Basi-Go CEO and vice president of the E-Mobility Association of Kenya.
