EVs could be cheaper to own than gas cars in Africa by 2040

Electric vehicles could be economically competitive in Africa sooner than expected. Just 1% of new cars sold across the continent in 2025 were electric, but a new analysis finds that with solar off-grid charging, EVs could be cheaper to own than gas vehicles by 2040.

There are major barriers to higher EV uptake in many countries in Africa, including a sometimes unreliable grid, limited charging infrastructure, and a lack of access to affordable financing. As a result some previous analyses have suggested that fossil-fuel vehicles would dominate in Africa through at least 2050. 

But as batteries and the vehicles they power continue to get cheaper, the economic case for EVs is building. Electric two-wheelers, cars, larger automobiles, and even minibuses could compete in most African countries in just 15 years, according to the new study, published in Nature Energy.

“EVs have serious economic potential in most African countries in the not-so-distant future,” says Bessie Noll, a senior researcher at ETH Zürich and one of the authors of the study.

The study considered the total cost of ownership over the lifetime of a vehicle. That includes the sticker price, financing costs, and the cost of fueling (or charging). The researchers didn’t consider policy-related costs like taxes, import fees, and government subsidies, choosing to focus instead on only the underlying economics.

EVs are getting cheaper every year as battery and vehicle manufacturing improve and production scales, and the researchers found that in most cases and in most places across Africa, EVs are expected to be cheaper than equivalent gas-powered vehicles by 2040. EVs should also be less expensive than vehicles that use synthetic fuels. 

For two-wheelers like electric scooters, EVs could be the cheaper option even sooner: with smaller, cheaper batteries, these vehicles will be economically competitive by the end of the decade. On the other hand, one of the most difficult segments for EVs to compete in is small cars, says Christian Moretti, a researcher at ETH Zürich and the Paul Scherrer Institute in Switzerland.

Because some countries still have limited or unreliable grid access, charging is a major barrier to EV uptake, Noll says. So for EVs, the authors analyzed the cost of buying not only the vehicle but also a solar off-grid charging system. This includes solar panels, batteries, and the inverter required to transform the electricity into a version that can charge an EV. (The additional batteries help the system store energy for charging at times when the sun isn’t shining.)

Mini grids and other standalone systems that include solar panels and energy storage are increasingly common across Africa. It’s possible that this might be a primary way that EV owners in Africa will charge their vehicles in the future, Noll says.

One of the bigger barriers to EVs in Africa is financing costs, she adds. In some cases, the cost of financing can be more than the up-front cost of the vehicle, significantly driving up the cost of ownership.

Today, EVs are more expensive than equivalent gas-powered vehicles in much of the world. But in places where it’s relatively cheap to borrow money, that difference can be spread out across the course of a vehicle’s whole lifetime for little cost. Then, since it’s often cheaper to charge an EV than fuel a gas-powered car, the EV is less expensive over time. 

In some African countries, however, political instability and uncertain economic conditions make borrowing money more expensive. To some extent, the high financing costs affect the purchase of any vehicle, regardless of how it’s powered. But EVs are more expensive up front than equivalent gas-powered cars, and that higher up-front cost adds up to more interest paid over time. In some cases, financing an EV can also be more expensive than financing a gas vehicle—the technology is newer, and banks may see the purchase as more of a risk and charge a higher interest rate, says Kelly Carlin, a manager in the program on carbon-free transportation at the Rocky Mountain Institute, an energy think tank.

The picture varies widely depending on the country, too. In South Africa, Mauritius, and Botswana, financing conditions are already close to levels required to allow EVs to reach cost parity, according to the study. In higher-risk countries (the study gives examples including Sudan, which is currently in a civil war, and Ghana, which is recovering from a major economic crisis), financing costs would need to be cut drastically for that to be the case. 

Making EVs an affordable option will be a key first step to putting more on the roads in Africa and around the world. “People will start to pick up these technologies when they’re competitive,” says Nelson Nsitem, lead Africa energy transition analyst at BloombergNEF, an energy consultancy. 

Solar-based charging systems, like the ones mentioned in the study, could help make electricity less of a constraint, bringing more EVs to the roads, Nsitem says. But there’s still a need for more charging infrastructure, a major challenge in many countries where the grid needs major upgrades for capacity and reliability, he adds. 

Globally, more EVs are hitting the roads every year. “The global trend is unmistakable,” Carlin says. There are questions about how quickly it’s happening in different places, he says, “but the momentum is there.”

The problem with plug-in hybrids? Their drivers.

Plug-in hybrids are supposed to be the best of both worlds—the convenience of a gas-powered car with the climate benefits of a battery electric vehicle. But new data suggests that some official figures severely underestimate the emissions they produce. 

According to new real-world driving data from the European Commission, plug-in hybrids produce roughly 3.5 times the emissions official estimates suggest. The difference is largely linked to driver habits: people tend to charge plug-in hybrids and drive them in electric mode less than expected.

“The environmental impact of these vehicles is much, much worse than what the official numbers would indicate,” says Jan Dornoff, a research lead at the International Council on Clean Transportation.

While conventional hybrid vehicles contain only a small battery to slightly improve fuel economy, plug-in hybrids allow fully electric driving for short distances. These plug-in vehicles typically have a range of roughly 30 to 50 miles (50 to 80 kilometers) in electric driving mode, with a longer additional range when using the secondary fuel, like gasoline or diesel. But drivers appear to be using much more fuel than was estimated.

According to the new European Commission report, drivers in plug-in hybrid vehicles produce about 139.4 grams of carbon dioxide for every kilometer driven, based on measurements of how much fuel vehicles use over time. On the other hand, official estimates from manufacturers, which are determined using laboratory tests, put emissions at 39.6 grams per kilometer driven.

Some of this gap can be explained by differences between the controlled conditions in a lab and real-world driving. Even conventional combustion-engine vehicles tend to have higher real-world emissions than official estimates suggest, though the gap is roughly 20%, not 200% or more as it is for plug-in hybrids.

The major difference comes down to how drivers tend to use plug-in hybrids. Researchers have noticed the problem in previous studies, some of them using crowdsourced data. 

In one study from the ICCT published in 2022, researchers examined real-world driving habits of people in plug-in hybrids. While the method used to determine official emissions values estimated that drivers use electricity to power vehicles 70% to 85% of the time, the real-world driving data suggested that vehicle owners actually used electric mode for 45% to 49% of their driving. And if vehicles were company-provided cars, the average was only 11% to 15%.

The difference between reality and estimates can be a problem for drivers, who may buy plug-in hybrids expecting climate benefits and gas savings. But if drivers are charging less than expected, the benefits might not be as drastic as promised. Trips taken in a plug-in hybrid cut emissions by only 23% relative to trips in a conventional vehicle, rather than the nearly three-quarters reduction predicted by official estimates, according to the new analysis.

“People need to be realistic about what they face,” Dornoff says. Driving the vehicles in electric mode as much as possible can help maximize the financial and environmental benefits, he adds.

It’s important to close the gap between expectations and reality not only for individuals’ sake, but also to ensure that policies aimed at cutting emissions have the intended effects. 

The European Union passed a law last year that will end sales of gas-powered cars in 2035. This is aimed at cutting emissions from transportation, a sector that makes up around one-fifth of global emissions. In the EU, manufacturers are required to have a certain average emissions value for all their vehicles sold. If plug-in hybrids are performing much worse in the real world than expected, it could mean the transportation sector is actually making less progress toward climate goals than it’s getting credit for.

Plug-in hybrids’ failure to meet expectations is also a problem in the US, says Aaron Isenstadt, a senior researcher at the ICCT based in San Francisco. Real-world fuel consumption was about 50% higher than EPA estimates in one ICCT study, for example. The gap between expectations and reality is smaller in the US partly because official emissions estimates are calculated differently, and partly because US drivers have different driving habits and may have better access to charging at home, Isenstadt says.

The Biden administration recently finalized new tailpipe emissions rules, which set guidelines for manufacturers about the emissions their vehicles can produce. The rules aim at ramping down emissions from new vehicles sold, so by 2032, roughly half of new cars sold in the US will need to produce zero emissions in order to meet the standards.

Both the EU and the US have plans to update estimates about how drivers are using plug-in hybrids, which should help policies in both markets better reflect reality. The EU will make an adjustment to estimates about driver behavior beginning in 2025, while the US will do so later, in 2027.