Rwanda Has Awesome New Incentives For EVs

Rwanda is introducing a new set of incentives to catalyze the adoption of electric vehicles. Rwanda’s updated Nationally Determined Contribution (NDC), outlines the importance of electric vehicles and the enforcement of vehicle emission standards as key mitigation measures on the path to reduce greenhouse gases. Earlier this month, Rwanda’s government approved a new set of incentives that will help meet these goals.

Speaking at the E-Mobility Technology Showcase in Kigali, Janvier Twagirimana, Transport External link & Donor Coordinator in the Ministry of Infrastructure (MININFRA), gave a summary of these incentives in his presentation “Status of E- Mobility in Rwanda.”

Fiscal Incentives:

• Electricity tariffs for charging stations to be capped at the industrial tariff. This means that charge point operators will be billed at close to USD 10 cents/kWh instead of close to 20 cents/kWh
• Electric vehicles will also benefit form reduced tariffs during off peak periods
• Electric vehicles, spare parts, batteries, and charging station equipment will all be exempted from import and excise duties. All of these would also be treated as zero rated VAT products and will also be exempt from withholding tax.

Non-Fiscal Incentives:

• Rent free land for charging stations on land owned by the government
• Provisions for EV charging stations in the building code and city planning rules
• Green license plate to allow preferential parking for EVs and free entry into any future congestion zones
• Access to dedicated bus lanes
• Provide preference to electric vehicle for government hired vehicles
• Regulate the importation of used vehicles by imposing an age limit
• Establish restricted zones where only green vehicles can have access
• Enforcement of existing emission standards to discourage the purchase of polluting vehicles.

Rwanda is actively encouraging investment in the e-mobility sector, and the Rwanda Development Board (RDB) also gave a presentation outlining some of the initiatives to encourage investment. Some of these incentives include a preferential corporate income tax rate of 15% for investors operating in e-mobility. Firms operating in the energy, ITC, and mass transport industries also qualify.

There are already several firms in the EV space in Rwanda and the new incentives should give them a major boost. Some of the firms that were exhibiting at the E-Mobility Technology Showcase in Kigali this morning include Guraride, Volkswagen, Victoria Motors, Rwanda Electric Motorcycles, and Ampersand. Ampersand has just secured a $3.5 million investment from the Ecosystem Integrity Fund (EIF). The deal is the largest ever e-mobility investment by a venture capital fund in Sub-Saharan Africa and marks a turning point in global electric transport.

Rwanda’s new incentives are quite comprehensive and will certainly help catalyze the transition to electromobility. Let’s hope more countries in the region also follow soon with similar incentives.

Images courtesy of Guraride and Ampersand