For three days at the beginning of Covid-19, Kenyan authorities stopped all buses from operating in the capital city of Nairobi to curb the spread of the virus. As the popular ‘matatus’ are responsible for substantial emissions, the three-day ban allowed the air to clear and Mount Kenya, which is 200km away, could be seen in the distance.
The striking difference in air visibility encouraged Jit Bhattacharya, who has a background working for East African transport companies, to set up an electric bus company called BasiGo with co-founder Jonathan Green.
“In those three days, the air completely cleared. And we said, let’s look at this market right now. The whole world is trying to address the climate crisis, but East Africa hasn’t transitioned over to electric buses. That motivated us to get the business started in the middle of 2021.”
Proving it can work
BasiGo essentially operates as an asset finance company, leasing electric vehicles to local bus operators. In March, the company partnered with City Hoppa and East Shuttle, two local operators, to introduce two 25-seater electric buses to Nairobi.
“Those buses have now travelled over 120,000 km and carried over 155,000 passengers,” says Bhattacharya. “They have performed incredibly well in the first six months of our pilot programme. We have had less than one day of downtime. We have proved that the technology is viable and it can work in this market.”
BasiGo operates a “pay-as-you-drive” model through which bus operators purchase the electric bus from BasiGo without the battery. They then pay around $0.16 per kilometre to lease the battery and for the energy used. The cost of a bus is Ksh.5 million (about US$40,000).
The buses are charged at charging stations in Nairobi which take power from the local grid. Bhattacharya says that the model is perfect for Kenya where over 90% of the electricity is from renewable sources.
The buses can run for 250km on an overnight charge – which covers “most bus journeys in Nairobi”. BasiGo is looking at gradually importing more powerful batteries to make the buses run even further.
Starting from scratch
The two buses currently active in Nairobi were imported fully built from China’s electric vehicle maker, BYD Automotive. However, BasiGo raised $6.6 million in November to start assembling the vehicles locally.
“The next 15 buses, which will be delivered in January, also from BYD Automotive, will be partially assembled,” says Bhattacharya. “But every bus after that in 2023 will be fully locally assembled from complete knockdown kits.”
Kenya has a well-developed manufacturing sector; the CEO says that BasiGo has partnered with a local vehicle assembly company to build the buses, reducing the need to make large infrastructure investments.
“They have an established plant. They have an established workforce that we can train in order to do this. We don’t need to build a factory when there’s already certified automotive assemblers available to do this.”
The bigger concern is installing electric charging stations across Nairobi. The company currently has two charging points, but it is planning to roll out 15 more across Nairobi next year.
“That’s one of the most important areas of development for us as a company,” says Bhattacharya. “Finding sites, finding partners in the form of shopping malls, petrol stations, parking lots where we can position them. Where it’s convenient for the bus operator, where there is existing power infrastructure and where chargers can operate remotely.”
Bringing other stakeholders on board
Bhattacharya says that another key challenge is adding new technology to a very traditional sector. “We are competing against an industry that has been in place for decades,” he says. “Combustion engine vehicles that are powered by fossil fuels. And we are coming in with brand new technology.”
The CEO adds that it also requires the trust and input from the local government and banks. BasiGo recently introduced a scheme to encourage local lenders to help bus operators buy buses.
“Some of the most exciting announcements in the last two months has been announcing partnerships with local banks,” he says. “The banks are ready to provide loans to bus owners in order for them to buy an electric bus. We know the technology is new. But BasiGo has shown the banks a model that is viable and where the risk is manageable. We have to bring along all the stakeholders: investors, policymakers, and operators.”
He adds that after BasiGo has proved the ‘pay-as-you-drive’ financing model, it will look to enter other East African markets. It is also looking for other vehicles, like delivery trucks.