World Bank: How Petrol Subsidy Slowed E-mobility Growth in Nigeria

Emmanuel Addeh in Abuja

A World Bank report has has indicated that Nigeria’s  massive subsidy on petrol before the latest removal may have slowed the development of e-mobility and use of alternative vehicles, like electric minibuses, two-wheelers and three-wheelers in the country.

Stressing this in a document tagged: ‘E-Trans-Electric mobility and transition in Nigeria: Strategy and implementation’, the bank recalled that fuel subsidy alone funding gulped N4.39 trillion last year.

The bank added that while Nigeria devotes significant funds to subsidise transportation, the funding had served to discourage the development of e-mobility across the nation.

“The subsidisation of petrol discourages the take-up of alternative vehicles such as electric minibuses, two-wheelers (E2W) and three-wheelers (E3W).

“Regulations to enact policies will also need to be developed, mostly at federal level, adapting the tax regime and permission framework for importing new and used vehicles,” the bank said.

According to the World Bank, this will also involve instating new framework drawing from international experience as for safe storage, recycling and disposal of batteries and e-waste associated with e-vehicles.

The objective of the study, it said was to facilitate dialogue on urban and rural clean energy e-mobility strategies that reduce air pollution, greenhouse gas emissions and health and economic impacts of mobility in Nigeria.

It added that that with the removal of fuel subsidy, the introduction of e-buses should be supported by subsidy and financing solutions to offset the high upfront cost.

It advised that the electricity should come from renewables where possible, with the extent of private involvement to be decided at the outset, and commuters encouraged to use e-buses.

 “Regulations to enact policies will also need to be developed, mostly at the federal level, adapting the tax regime and permission framework for importing new and used vehicles and instituting new framework drawing from international experience for safe storage, recycling and disposal of batteries and e-waste associated with e-vehicles.