Development Of EV Markets & Charging Networks In Developing Countries (Based Off Of In-Depth Knowledge Of Ukraine)
Editor’s Note: Below is an article by Hanna Yanchuk on the topic that she presented on during our Berlin Cleantech Revolution Tour conference. You can also view a few highlights from her presentation in the video at the bottom of the article. Our next Cleantech Revolution Tour conference is a compact one tomorrow in Leipzig, Germany. Join us if you can!
By Hannah Yanchuk of the Electric Vehicle Association of Ukraine (Facebook page here)
Recently, the market for electric vehicle and charging networks has been actively growing in most countries. We all know that using electric cars in developed countries is pushed by governments by means of cash rebates, tax credits, and other subsidies. However, in developing countries, such as Ukraine, the things are different. Unfortunately, I must say the number of electric cars in these countries is quite limited due to low quality of life and the lack of government support.
I’d like to outline the EV industry in developing countries in a few words with the example of Ukraine. Sadly, there is no rebate scheme because the government budget has been allocated to higher-priority areas. But we find it efficient to implement cost supports such as cuts in taxes and fees when buying or registering electric cars. As long as our country has a rather small number of electric cars, the country budget won’t bear any significant financial losses from providing rebates and bonuses like in other countries. What’s more, we know that this kind of rebate is limited in time.
For example, taxes and registration payments reach up to 30–40%. An electric car itself is by 40–50% more expensive than gasoline car of a similar size and with similar features (not including the Tesla Model 3). Without such taxes and registration payments, an EV would be more competitive and about 30% more affordable for customers.
The ecological component of autonomous electric transport suggests several non-financial benefits, as well as benefits that eventually turn into financial benefits for the citizens (such as better health and less extreme-weather damage). For starters, the media needs to provide more information about electric transport and about its ecological and economic efficiency. Additionally, we need to add EV terminology into legislation and other official documents. Also, as we know from worldwide practice, EV adopters benefit from free parking, using public transport lanes, free access to the city center in congestion zones, and free access to to resort areas and conservation parks. In many developing countries, this would also help, and it is perhaps the easiest way for the government and state bodies to stimulate the EV market and support EV adopters.
Next – generally, in developing countries, we enjoy quite low prices for electric power, but even beyond subsidies to enable that, all electric public transport has preferential tariffs, which, in our opinion, should definitely be applied to private electric cars as well.
It’s evident that for genuine development of the EV industry, it’s absolutely vital to build charging infrastructure. However, budgets of developing countries don’t typically have enough resources for this side of things. We are sure they can be found, though, by implementing EVs into commercial projects. What do I mean? One of the main objectives of market movers is to offer commercial solutions related to the use electric transport, which in this case gives economic stimulus. Possible projects are:
- electric taxis
- electric buses
- electric delivery services
- shipping via electric vehicles
- tourism using electric vehicles
To sum up, all of these options could be stimulated if the government agreed to provide preferential tariffs on electric power for the businesses noted.
Who are the possible participants in these models?
- Financial institutions such as banks or unions, which can provide credit/funding for the projects
- Leasing Companies
- Sellers of autonomous electric transport
- Businesses and private investors who are willing to work on this transport due to its cost effectiveness.
These beneficiaries will be able to finance the development of the charging infrastructure. But to involve private business in development of the infrastructure, the procedure for obtaining permits for charging stations installation should be easy and accessible. In addition, the local authorities should research the necessary capacities and traffic flows in the places where there are plans to install a network of charging stations, and to make a list of good locations (maps).
If all of these things are done, governments would offer societal participants clear and simple business models for using autonomous electric transport.
Launching such projects involves setting up an infrastructure network. So, as a consequence, there are many more projects that can replace old polluting vehicles with electric vehicles, and as a result, the economy can grow and the budget as well thanks to taxation and to less imported foreign fuel. And last but not least, new jobs are generated for both highly skilled and less skilled people.
In whole, developing countries have many methods for growing the EV market, and joining if not leading global changes. Steady and integrated development of energy-saving and ecologically efficient programs in Europe is most possible if the progress of all European countries is relatively synchronous, which means getting developing countries up to speed. And we have to not forget that only joint development will give the expected results of the agreement signed at the 2015 United Nations Climate Change Conference in Paris (COP21).
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The Electric Vehicle Association of Ukraine (Facebook page here) unites supporters and users of electric cars to promote electric vehicles, setting up the infrastructure (charging stations), developing and adopting legal frameworks for the development and diffusion of environmentally friendly transport, and sharing research on the EV market and potential growth. Its chief aim is developing and growing the EV market in Ukraine, and improving the representation of Ukraine in the world “green” market.
Hannah has long been involved in EV promotion and development, as has her family, and she is now the Deputy Head of Board of the Electric Vehicle Association of Ukraine.
Below are a couple of other EV highlight videos from our Berlin Cleantech Revolution Tour conference. If you want to see a lot more in person and contribute to the discussions as well, please join an upcoming Cleantech Revolution Tour conference.
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for developping country EV market develpmant, governments and car makers have done nothing yet
Batteries are still too expensive to allow manufacturing of low cost EVs. It will take a few more years to bring costs down.
My experience in developing countries suggests that over 90% of cars are imported used cars. There aren’t enough used EVs yet.
while waiting battery cost to drop and used EVs to be availeble its the right time to start building charging infrastructure so that when the above hapen we find ourself will prepared and avoid chiken – egg story
It’s too early. Invest in a charging infrastructure when the need is there.
Developing countries should probably be looking mostly at public transportation for long range travel. Make public transportation as efficient as possible, watch for opportunities to electrify.
When there are some 200 mile EVs then it will be time to install a small number of chargers in order to move between cities.
Planning now and updating those plans as charging systems improve could be a wise idea.
Freeriding looks a sensible ev strategy for poorer countries at thus point. Two qualifications, though.
One: if they have a car manufacturing sector, like India, the only way to save it is to introduce EV incentives now to encourage it to switch. Otherwise, in 20 years it will be wiped out by foreign EV behemoths.
Two: the health costs of fossil fuels are also high in poorer countries, exacerbated by lax regulations on ICE emissions and poor enforcement. This means that some level of incentives for zero-emission vehicles is automatically justified.
A few years from now, it will pay the big EV manufacturers to subsidise the rollout of fast charging networks in countries like Ukraine. These are a precondition for building the EV market.
In case of Ukraine there are strong political will to break any relations with Russia, and they are now trying to switch their NG power station to coal.
And they just allowed fracking for same reason – to stop buying russian gas in a next few years.
So clean air is the last thing Kiev is thinking about, at least for now.