Making sense of the electric vehicle bill, By Uddin Ifeanyi
If the Senate Committee on Industry completes its review on time, then, the Electric Vehicle Transition and Green Mobility Bill 2025 should be back to the upper legislative chamber sometime next month for its third reading and, hopefully, final passage. The bill which seeks to create a legal and institutional framework for Nigeria’s transition to electric vehicle (EVs) use passed its second reading last week. The global milieu could not be more encouraging. Renewable energy is not just cheaper, today, than most fossil alternatives, the price-per-kilowatt hour of electricity from wind- and solar-power stations continues to fall. In major economies across the world, renewable power is a growing share of energy use. Between better storage systems (batteries, compressed-air storage, flywheels, etc,) and the world’s growing artificial intelligence capabilities, the burden of intermittency that dogs renewable power use ought soon to be outdated.
The energy transition, thus, promises to leave far more of our proven crude oil reserves in the ground than we will ever have need for. Nowhere is this challenge more obvious than from the revolution that China has driven in the electric vehicle (EV) space. Then, there is enlightened self-interest. If continued combustion of fossil fuels contributes to a warming global climate, and if geographies like ours will suffer the most from a hotter world, then, we owe a moral inter-generational duty to do all in our power to dial down the oven’s gas knob.
How well does the mobility bill fare in this regard? Whichever way we choose to approach this problem, we will eventually have to develop a local EV manufacturing industry, encourage EV adoption by individuals, firms, and government, build charging infrastructure nationwide, integrate renewable energy into transport, and create jobs and position Nigeria as a clean transport hub, at least for west Africa. All of these goals are met by the bill. But that is where the bill’s appeal ends. The bill’s incentives to boost local content requirements, for instance, lean heavily in favour of a protectionist industrial policy. All stick and no carrots, as presently written, the fines and conditions for non-compliance are likelier to discourage early foreign participation.
Nor is a multiple agency regulatory environment conducive to the design of an optimal policy space for the promotion of a local EV industry. The bill does assign the responsibilities between the many agencies (five of them at the last count) it designates for this purpose well. But you can never go wrong by keeping processes simple. In all likelihood, the riot of agencies risks overlapping mandates and bureaucratic bottlenecks in the absence of a single lead implementation agency. And this is before you throw in the mandate to every fuel station to immediately install chargers. No matter the jackboots thrown at this phase, nothing will happen without a phased or incentive-based rollout – or both.
The bill sports an impressive list of incentives. Nonetheless, it lacks important detail on how long these will be in place, or what levels of investor compliance would trigger necessary phase-outs. Then, there is the part of policy that we always overlook: How is the country going to pay for the provision of much of these incentives? On balance, thence, the bill is strategically sound and forward-looking. Sadly, in terms of how practical it would be as is, it is kind of premature. The national grid remains the big elephant in the room. You cannot build an environment that supports rapid take up of electric vehicle use on the back of a grid as unreliable as the one we currently have, with its frequent outages and low effective capacity. Crucially, without addressing the additional cost, policy, and behavioural barriers, required to support the bill’s intent, local EV adoption will remain very low – irrespective of the bill’s intent or design.
If the Senate Committee on Industry serves the nation well, and if it is to be of any use, the bill that it returns to the Senate for the third reading and final passage must address the following needs: elaboration of a phased adoption plan (2025–2040 roadmap); the design of targeted incentives for infrastructure and fleet conversions; description and roles of a single EV transition authority for implementation coherence and proper sequencing of the roll-out; and the bill’s integration with the ongoing power-sector reforms. Get this mix right, and huge corollary opportunities open up, including reduced fuel import bills, lower urban air pollution, new manufacturing/assembly opportunities, and the economy’s alignment with climate/energy goals.
Uddin Ifeanyi, journalist manqué and retired civil servant, can be reached @IfeanyiUddin.