New Electric Vehicle (EV) Charging Systems Directive No. 1034/2024

The Petroleum and Energy Authority (“PEA”) has issued a new Electric Vehicle Charging System Directive No. 1034/2024 (“Directive”). The Directive establishes a legal framework to regulate at-home and commercial EV charging activities. Key areas addressed include licensing requirements, technical standards, safety protocols, tariff structures and service charge determinations. The Directive also sets out rights and obligations of EV charging service providers, service users, electricity providers, and EV owners. In this edition of our Insights, we highlight the key features of the Directive.

Scope of Application 

The Directive applies to both users and providers of Electric Vehicle Charging Systems (“EVCS”) in Ethiopia. An EVCS refers to a complete system that includes EV supply equipment and the necessary functions to supply electric energy to an EV for charging purposes.  The Directive also governs both on-grid and off-grid electricity suppliers that will provide electricity services to EVCS. 

EV Charging Services 

The Directive classifies Electric Vehicle Charging Systems (EVCS) into three types:

1. At-home EV Charging – Charging conducted by the owner of an electric vehicle using a charger installed at its residence.
2. Public EV Charging Station Services (PCS) – Charging stations accessible to the public, where any EV can have its battery charged.
3. Captive Charging Station Services (CpCS) – Charging stations exclusively for EVs owned or controlled by the charging station owner. Examples include government offices, corporate facilities, bus depots, and fleet owner-operated stations. CpCS is restricted to private use and must not be utilized for commercial purposes.

Charging Modes 

EV charging services can be provided through four distinct modes, each offering different speeds, convenience levels, and safety features, depending on the charging speed, duration, and communication between the EV battery and the charger. 

1. Mode 1 – A basic, slow charging method using a standard household plug, without safety or communication features between the EV and the charger. It will take 8–12 hours for an EV to fully charge under this mode. 
2. Mode 2: Similar to Mode 1 but equipped with an in-cable control device for added safety, such as preventing overheating and electric shocks, this mode provides slightly faster charging compared to Mode 1.
3. Mode 3: A semi-fast charging method using dedicated wall boxes or stations that enable optimized charging through communication with the EV. This mode is widely used for home and public charging due to its enhanced safety and reliability compared to Modes 1 and 2.
4. Mode 4: The fastest charging method, utilizing a direct current (DC) charging station. This mode bypasses the EV’s onboard charger, directly charging the battery. It is commonly used at public charging stations, delivering up to 80% charge in less than 30 minutes.

Licensing 

At-home EV charging will not require a license to operate. However, Public Charging Stations (PCS) and Captive Charging Stations (CpCS) must obtain a license from the PEA. The Directive categorizes licenses based on charging capacity as follows:

• Class I License – For EVCS providers with a charging capacity of less than 100 kW.
• Class II License – For EVCS providers with a charging capacity exceeding 100 kW.

Each license is site-specific, requiring EV charging service providers to obtain a separate license for each service, whether it is a Public Charging Station (PCS) or a Captive Charging Station (CpCS). A PCS license does not grant the licensee the right to operate a CpCS and vice-versa. To apply for an EVCS license, applicants must submit a completed application to the PEA. The application must include proof of financial and technical competency, relevant professional certifications, trade registration, and payment of the required license fees. Neither the  Directive nor the recently adopted PEA License Fee Regulation provide the applicable license fees for EVCS. This is a legislative gap that will need to be addressed. 

PCS applicants are required to provide additional information, including details about the electricity source, a project site map, a capacity feasibility study, and whether the connection is grid-based or off-grid. Before commencing commercial operations, PCS licensees must submit (where needed), a power purchase agreement (if applicable), a project finance agreement, an environmental impact assessment clearance, and a land-use permit.

PCS and CpCS licenses are valid for two years and are subject to renewal. The PEA may suspend or revoke a license if the licensee fails to fulfil its obligations, following the procedures outlined in the Directive. Additionally, penalties under Energy Regulation No. 447/2019 will apply if EVCS operators violate the provisions of the Directive.

Rights and Obligations 

The Directive grants several rights to EVCS providers. Licensees are permitted to establish charging stations and charge service fees for their use. The Directive also provides licensees with the option to generate their own electricity or purchase electricity from public utility companies, such as Ethiopian Electric Power (EEP) or Ethiopian Electric Utility (EEU).

The Directive imposes various obligations on EVCS providers. They must register their charging stations with the relevant authorities and report any incidents involving their facilities. These facilities include all real property, such as buildings, fixtures, or other improvements located on the premises, that are leased, operated, or used by the company, its subsidiaries, or their respective predecessors or affiliates. Moreover, EVCS providers are required to:

• Ensure non-discriminatory access to their services.
• Adhere to safety and operational standards.
• Offer fair and transparent pricing.
• Provide accessible, safe, and well-maintained facilities.
• Ensure repairs and maintenance are conducted by certified professionals. 

Electricity Suppliers 

The Directive recognizes the rights of licensed electricity suppliers, both private and public, to generate and sell electricity to EV charging service providers. Electricity tariffs must be approved by PEA and connection of the electricity supply systems to EV charging facilities must comply with the National Grid Code. Electricity suppliers are also required to comply with technical, safety and operational requirements and standards.

Electricity Tariffs and Service Charges

Under Energy Proclamation 813/2013 (as amended) and Energy Regulation No. 447/2019, the PEA will set tariffs for electricity supplied to off-grid EV charging stations. For stations connected to the national grid, tariffs will follow the general grid rates. EEP or EEU may propose new tariff categories to PEA for EV charging if needed. Standard domestic electricity rates will apply to home charging activities. 

EVCS providers have the flexibility to set their service charges. Data on energy use and peak demand must be gathered through electricity meters installed at the final customer connection points. 

Technical and Safety Protocols

The Directive requires EV charging service licensees to comply with international standards and the Ethiopian National Distribution Grid Code.   It also outlines essential technical and safety requirements, such as minimum specifications for chargers, connectors, and power supply systems. To ensure safe operations, the Directive emphasizes the installation of key safety measures, including surge protection devices, fire safety equipment, and proper earthing systems.

Public charging systems are required to prioritize safety, functionality, and convenience. This entails installing dedicated transformers, approved power supply facilities, proper cabling, and electrical work, as well as fire protection equipment. Charging stations must also provide adequate space for vehicle entry, exit, and charging. In addition, public charging systems must:

• Have at least two charging ports.
• Ensure compatibility with regional EV connectors and protocols.
• Support interoperability across networks.
• Deploy smart meters and communication devices to monitor energy usage and provide real-time data.
• Display clear signage, including service details, pricing, payment options, and emergency contact information.

Location

The Directive requires PCS to be established every 50 kilometers on both sides of a highway. For heavy-duty EVs, such as buses and trucks, the Directive mandates at least one fast-charging station every 120 kilometers. Licensees may, however, apply to the PEA for permission to install additional charging stations within the specified distance range. The Directive also proposes suitable locations for public charging stations, prioritizing areas convenient for EV users, such as near public facilities and entertainment venues like shops, malls, restaurants, public parks, and sports arenas.

EV Owners

EV owners are permitted to establish private charging stations at their residences or offices and may generate their own electricity, provided they obtain the necessary licenses. They can access charging services at any Public Charging Station (PCS) and are entitled to reasonable compensation for damage caused by substandard services. However, the Directive does not specify what constitutes reasonable compensation. On the other hand, EV owners are required to adhere to technical standards, comply with public station guidelines, and pay for the services they use.

Transition and Implementation Timelines

Current EV charging operators are required to comply with the Directive's requirements and obtain licenses within six months of its enactment. Electricity supply tariffs already in place may be revised if justified and approved by the PEA. New market entrants, however, must meet all licensing and technical criteria before beginning operations.

Conclusion

Since 2022, Ethiopia has adopted policies to encourage the use of EVs, including tax and customs duty incentives. Recently, Ethiopia implemented a policy banning the import of internal combustion engine (ICE) vehicles. This raised concerns about the availability and adequacy of existing legal and physical infrastructure for charging stations and the EV sector in general. The enactment of the Directive marks a step in the right direction, filling a key regulatory gap. It offers guidance on EV charging stations, electricity tariff determination and service charges, EV owner protection, and licensing requirements for businesses interested in the sector.  However, the absence of clear provisions on licensing fees, reasonable compensation for damages caused to EV owners, the lack of targeted incentives for investment in remote areas and the use of renewable technologies are gaps that will need to be addressed in the future.