Nigeria’s Senate is considering a transformative step in the automotive industry with the Electric Vehicle Transition and Green Mobility Bill. Announced by Senator Orji Uzor Kalu of Abia North, the bill passed its second reading on November 5, 2025, and is poised to reshape the landscape of electric vehicle (EV) adoption in the country.
To access the full text of the bill, visit here. The bill has now been assigned to the Senate Committee on Industry for further scrutiny, with its return to the Senate Chambers expected in four weeks.
By embracing this bill, Nigeria could join the ranks of African nations like Ethiopia, Kenya, and Rwanda, which have already set policies in place to support the shift to electric vehicles.
Key Aspects of the Proposed Legislation
The Electric Vehicle Transition and Green Mobility Bill is designed to bolster Nigeria’s electric mobility by enhancing local EV production, increasing adoption rates, and attracting foreign investment. It imposes specific requirements on foreign automakers to ensure more localized involvement in the market.
Foreign automakers will need to collaborate with local entities to import, sell, or distribute their vehicles in Nigeria. Moreover, within three years of entering the Nigerian market, these automakers must establish local assembly plants and source 30% of their components from within the country by 2030.
Local assembly and manufacturing operations will require licensing, contingent upon demonstrating the capacity to produce a minimum of 5,000 EVs annually. Non-compliance with these stipulations will result in significant fines, such as ₦500 million for unlicensed activities and ₦250 million for foreign automakers not meeting the bill’s requirements.
The bill also offers incentives like tax holidays, waivers, and subsidies for businesses and individuals involved in the EV sector. EVs will benefit from road tax and emission testing exemptions and toll-free highway access, though the specifics of these incentives remain undisclosed.
Tasked with implementing the bill are several ministries, including the Federal Ministry for Industry, Trade, and Investment as the lead, supported by the Federal Ministry of Transportation, the Federal Ministry of Power, the Federal Inland Revenue Service, and the Federal Ministry of Environment.
Implications and Industry Perspectives
The intention behind the bill is to nurture a self-sustaining EV ecosystem within Nigeria. Yet, the industry remains divided on the readiness of Nigeria’s market for such an ambitious framework.
Ayodeji Audu, CEO of Reown, views the bill as a positive move. “What the government is trying to do is to empower our local businesses and, most importantly, to reduce the price of electric vehicles,” he commented. However, he noted that local sourcing is viable only if Nigeria can meet the resource demands.
Conversely, an unnamed analyst expressed skepticism, citing the absence of significant interest from global EV manufacturers in Nigeria. The analyst contends that the bill’s requirement for establishing local assembly plants may not yield results due to the limited demand.
Femi Oriowo, CEO of Carbin Africa, echoes this sentiment, noting the challenges for foreign automakers to invest heavily in Nigeria’s current market, which predominantly features local OEMs and assembly partnerships.
Learning from Regional Experiences
Nigeria can draw lessons from Ethiopia, which in 2024, took the bold step of banning the import of fuel-powered vehicles and offering significant tax incentives for EVs. Despite these measures, adoption rates in Ethiopia remain low due to high costs.
With an estimated 15,000 to 20,000 EVs in Nigeria, representing a mere 0.5% of the vehicle market, affordability remains a key barrier to widespread adoption. Uche Ukonu Jnr, a notable figure in Nigeria’s EV sector, recommends focusing on affordability rather than just manufacturing capabilities.
Oriowo suggests that enhancing credit and financing options could accelerate EV adoption, given the erosion of purchasing power among consumers. “The demand for financing surged heavily, and for mass adoption to happen, the government needs to look into financing initiatives,” he stated.
Unlike other African nations, Nigeria’s bill opts for a more stringent approach, focusing on industry mandates and penalties rather than incentives. Infrastructure improvements, like charging stations at fuel points, are part of the bill’s strategy to enhance adoption. However, success will hinge on addressing broader infrastructure challenges and providing substantial incentives to stimulate investment in the sector.
Original Story at techpoint.africa