Supply problem, lack of charging stations stall uptake of electric bikes in Rwanda

KIGALI – For nine years, Mr Celestine Nselgiumva, 34, has taken passengers around the streets of Kigali on his petrol-powered motorbike. But his biggest wish is to ride an electric motorbike.

“It looks cool and it is much faster than normal motorbikes. It is also environmentally friendly as it produces less noise and pollution,” he said. “But the lack of stations to swop depleted batteries for new ones is why I haven’t converted.”

While Mr Nselgiumva noted that battery-swopping stations are a common sight in Kigali, the capital, they are less common in the provinces. As he sometimes ferries passengers out of Kigali into neighbouring provinces, he is afraid of being stranded somewhere remote on an electric motorbike.

But demand for the electric two-wheelers is growing, alongside the east African nation’s aim to fully electrify its “moto taxi” fleet.

According to the Ministry of Infrastructure, Rwanda has more than 100,000 petrol-powered motorbikes. Some 46,000 operate as moto taxis, with 26,000 in Kigali alone. In 2021, the government partnered the United Nations Development Programme to convert more petrol-powered motorbikes to electric bikes, in line with a 10-year climate action road map to reduce 4.6 million tonnes of carbon dioxide.

To persuade vehicle owners to switch to electric, the government offers tax and other incentives, such as capped electricity tariffs for charging stations and rent-free land for building them, preferential parking and travel lanes for electric vehicles around Kigali, and restrictions on emissions from polluting vehicles.

Attracted by the cost savings, more moto taxi drivers are making the switch, said Mr Josh Whale, 41, chief executive of Ampersand, a local start-up founded in 2018 that produces electric motorbikes, batteries and swopping stations.

“Electric motorbikes offer a 30 per cent increase in take-home pay as drivers save on petrol prices and maintenance fees,” he said.

Ampersand operation coordinator Kevin Mucyo, 24, said: “The drivers are paying almost the same amount of money but electric motors can travel longer distances and drivers swop batteries fewer times (than they would have to fill up with petrol).”

In Rwanda, one litre of petrol costs about US$1.40 (S$1.90) and lasts about 45km, depending on the terrain and speed, he said. With electric motorbikes, it costs about US$1.50 per battery swop and drivers can ride up to 70km.

Singaporean Simon Ting, 64, business development manager at Rwanda Electric Mobility (REM), said drivers can also save costs by retrofitting their motorbikes.

REM sells its brand of electric motorbikes in Kigali, and, for a cheaper rate, retrofits petrol-powered models with batteries to convert them to electric. It also rents out fully charged batteries to e-bike riders. “With oil prices increasing, Rwanda is facing huge inflation. By converting to an electric motorbike now, drivers can enjoy savings of about US$1,200 per year and there is a possibility of it increasing over the years,” Mr Ting said.

Retrofitting his bike at REM two years ago cost him about 800,000 Rwandan francs (S$888), said Mr Thomas Dukuzeyezu, 38, who has been driving a moto taxi for 18 years.

Mr Whale noted that there are currently more than 2,000 electric moto taxis on Rwanda’s roads.

“Motos are 60 per cent of all passenger transport in Rwanda. Electrifying motorcycles would be the easiest market to convert due to the high cost of converting four-wheel electric vehicles,” he said.

Ampersand’s fleet has increased from 150 electric motorbikes a year ago to the current 1,250, while the number of REM motorbikes on the roads has risen from eight in 2020 to 300 now.

Both companies have a large backlog of orders, in part because of the government push for e-bikes.

Mr Whale said Ampersand has more than 9,000 drivers in line for its bikes, while REM’s Mr Ting said more than 2,000 drivers are queueing to either retrofit their motorcycles or buy new e-bikes.

However, producing large numbers of electric motorbikes requires capital and a network of centralised charging stations. The lack of funding and adequate power supply at charging points are two factors that could put a dampener on the uptake.

Mr Ting said REM cannot rent out more batteries because its centralised charging station – located in an unassuming warehouse at the foot of a dusty slope in Kigali – cannot cope with the demand.

“We have already maximised the amount of power source available at the centralised charging station, which also means we have reached the maximum battery production level,” he said.

Mr Ting said the centralised charging station needs a minimum of 400 kilo-volt-ampere to charge up to 950 batteries a day. Some of the fully charged batteries are then ferried by three electric trucks to four swopping stations.

To overcome the problem, REM is looking to build more charging stations to ramp up the supply of batteries. Starting in November, it will be able to rent out more batteries to riders, following the launch of a new facility located in Remera, Kigali.

“With the new facility operating together with the current one, we can potentially cater to a fleet size of 3,000 e-bikes using our batteries,” Mr Ting said.

Ampersand, on the other hand, faces a lack of capital and supply chain problems.

“We are a growing company and we need to raise funds and capital for growth,” said Mr Whale.

However, raising the necessary capital quickly is difficult. “Climate venture-capital firms tend to sit on the fence and invest in already stable, low-risk technologies, rather than (in) new tech,” he noted.

Mr Mucyo noted that the global pandemic and Russia-Ukraine war also disrupted supply chains and drove up prices of materials and parts used to assemble the motorbikes.

“The pressure is that we have too much demand for motorbikes now that it is outstripping supply. We don’t have enough money to produce the batteries and motorbikes.”

To reduce financial risks, Ampersand is selling batteries to companies that want to run charging networks and working with others in the energy infrastructure industry to set up subsidiaries, said Mr Whale.

“This will attract more investors and ensure a better resource allocation that will optimise production to meet the demand,” he added.

Mr Mucyo said the company is looking to produce some parts of the motorbikes locally rather than rely on offshore manufacturing companies.

As electric motorbike companies take steps to ramp up their supply, Mr Nselgiumva is hopeful that more swopping stations will be set up.

“I cannot wait for the day when swopping stations will be a common sight throughout Rwanda. Then I can get to drive an electric moto without any worry,” he said.