Fuel shortages and high prices push adoption of EVs in Africa, led by Ethiopia

More than 115,000 EVs are now on Ethiopia's roads, accounting for about 8% of the national fleet. In 2025, it imported a third of Africa’s imports from China, ahead of other major markets in South Africa, Egypt, Morocco and Nigeria.

As the Iran war drags on, Ethiopia’s fuel shortages are rippling through transport systems and daily life, reinforcing its effort to cut costly imports of oil and gas and strengthen its energy security. However that trend is raising questions about charging infrastructure and affordability.

Ethiopia’s spends about $4.2 billion on fuel imports annually, straining its foreign currency reserves.

Its minister of Trade and Regional Integration, Kassahun Gofe, said in a statement that the country also is spending up to $128 million monthly on fuel subsidies, while shipments fell short by more than 180,000 metric tons as the imports are disrupted by Iran's effective closure of the Strait of Hormuz, the shipping route for about a fifth of oil from the Gulf region before the war.

The government has redoubled its campaign for quicker EV adoption, framing it as a critical buffer against external supply shocks.

“From a general perspective, it is sustainable,” said Hiten Parmar, executive director of South African- based The Electric Mission. “By replacing imported fuel with domestically generated electricity, Ethiopia is strengthening its energy security position.”

Ethiopia has an edge

Ethiopia has a special advantage in that more than 90% of its electricity comes from renewable sources, mainly hydro and solar. The Grand Ethiopian Renaissance Dam, Africa's largest hydroelectric project, is expected to double its power generation, though the facility and has fueled a decade-long dispute over water supplies with downstream Egypt and Sudan.

“That scale of generation creates a foundation for electrified transport,” Parmar said. “It allows EVs to be powered by locally produced clean energy, rather than costly imports.”

“By gradually adopting EVs, that intensive fuel import expenditure can be reduced and redirected into other critical development needs,” Parmar said.

Globally, the International Energy Agency estimates electric vehicles displaced more than 1 million barrels of oil consumption per day in 2024.

Countries across Africa are pushing for more EVs

Egypt, South Africa and Morocco also are pursuing a transition to EV use, adopting a mix of policy incentives, investing in manufacturing capacity and in clean energy.

“That transition is beginning to ease pressure on fuel demand,” said Bob Wesonga, policy and investments lead at the Africa E-Mobility Alliance.

“That’s over 100,000 vehicle owners who are no longer directly exposed to pump price shocks,” he said. “In the medium to long term, this creates a buffer against global oil volatility.”

For those who have switched, the savings are significant.

“A private EV owner now spends roughly $4 a month on charging compared to about $27 previously spent on fuel,” Wesonga said. “For public transport operators, the difference is even more striking.”

Charging stations and other infrastructure are still lacking

The transition to EVs faces some daunting structural hurdles, Parmar notes.

“The technology is already mature, the challenge is building it out fast enough,” he said.

Ethiopia is deploying ultra-fast charging hubs in its capital Addis Ababa, but scaling them nationwide will take time and investment.

“The biggest hurdle is the last-mile power distribution,” Wesonga said. “While Ethiopia has a surplus of generation, getting that power reliably to where it’s needed, especially outside Addis Ababa, remains a challenge.”

Frequent blackouts and delays in connecting high-capacity charging stations have slowed construction of needed infrastructure, even as demand for electric vehicles rises.

“Charging infrastructure is still heavily concentrated in the capital and along a few corridors,” Wesonga said. “That limits e-mobility to specific areas and creates a bottleneck as adoption grows.”

Plans to assemble EVs raise question of affordability

Ethiopia is one of several countries in Africa looking to build their own EV industries. Official data show 17 electric vehicle assembly plants are in the pipeline in Ethiopia, with plans to raise that number to 60 by 2030. It's part of a broader strategy to localize production and reduce costs.

Affordability, however, remains a major constraint. While operating costs are lower, prices of electric vehicles remain high relative to average incomes.

“The purchase price is still out of reach for many,” Wesonga said. “At the same time, restrictions on fossil fuel vehicles have pushed up the cost of used cars, creating additional barriers.”

That dynamic could have unintended social impacts if not managed carefully.

“A national fleet transition is always gradual,” Parmar said. “Existing combustion vehicles will remain in use for some time, and the transition needs to account for livelihoods tied to that system.”

Even so, both experts say the long-term trajectory remains clear. Lower operating and maintenance costs for electric vehicles could reduce transport costs over time, easing the price of goods and improving access to economic opportunities.

Ethiopia is also looking to lessons from countries such as China and Norway, where policy support, infrastructure investment and consumer incentives have driven rapid adoption.

“This is not just about transport,” Wesonga said. “It’s about reshaping how the country uses energy, and who benefits from that shift.”

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