Electric mobility investment in developing countries: emerging regional patterns from cross-country analyses

Abstract

On paper, many developing countries have made pledges to decarbonise and reduce GHG emissions. Nevertheless, decarbonisation is barely happening in many of them. Among other reasons, transport electrification with electric mobility, which is pivotal in the decarbonisation strategy of many developing countries, is beset by investment challenges on the demand and supply side. On the demand side, the lingering 'where will the money come from' challenge remains critical because the governments are financially constrained. On the supply side, investors remain unsure of which country to make electric mobility investment. This paper contributes to this academic and policy debate from the transport and power sector coupling context. We apply our conceptual framework to analyse some developing countries with wholesale power markets and wholesale and retail power markets. Then, we conduct crosscountry analyses of fifteen countries to assess the possibility of emerging patterns in electric mobility investment solutions in the countries. We argue that regional or continental patterns may be emerging among some countries. We found that Latin American countries (Chile, Colombia, Argentina) appear to follow a pattern of investment in public transport electrification with electric buses, although the countries are at different stages of development. Romania, Poland, and Türkiye appear to follow an investment pattern in private electric vehicles. We found a pattern with low-cost two and three-wheelers in Central American countries (Nicaragua, Guatemala, and El Salvador). We recommend policies on electric mobility investment issues in developing countries.

Keywords: investment, developing countries, electric mobility, decarbonisation, digitalisation, energy transition