British International Investment (BII), the UK’s development finance institution and impact investor on Tuesday announced $5 million (Sh765 million) in debt funding for electric Bus solution provider BasiGo Ltd.
The funding comes from BII’s Climate Innovation Facility, a catalytic programme for accelerating climate innovation in emerging markets.
The investment will be used to scale up local assembly of electric buses to cater to the rapidly growing demand from bus operators in Kenya.
The buses will be delivered through BasiGo’s innovative Pay-As-You-Drive financing model which enables bus operators to acquire electric buses without incurring the high upfront cost.
Consequently, BII’s financing support will be crucial in transitioning Kenya’s public transport from diesel-powered vehicles to modern electric buses.
Each BasiGo electric bus deployed in Nairobi in place of a diesel bus mitigates over 50 tonnes of carbon dioxide (CO2) emissions per year.
The BII and investment in BasiGo is aligned with the vision of new Africa Green Industrialisation Initiative (AGII) launched at COP28 in Dubai, to support the development of sustainable and resilient industries that can create jobs, reduce emissions and enhance biodiversity.
"We are thrilled to receive this catalytic financial support from BII. It is a testament to our shared commitment towards building scalable climate solutions here within Africa," said Jonathan Green, co-founder and chief financial officer of BasiGo.
He said because electric buses in Kenya are powered by the abundance of renewable energy, electrification of public transport in Kenya holds transformative potential.
"Electric buses promise freedom from fuel imports, cleaner air, modern and affordable transport for the general public, and significant impact in lowering transport carbon dioxide emissions. BII recognises this opportunity, and their support for BasiGo will enable us to directly deliver on that promise,” he added.
BII Head of Africa and Managing Director Chris Chijiutomi said with 75 years of investing for impact across Africa, they are excited to partner with businesses at the fore front of tackling climate change.
"BasiGo is a leader, its revolutionising public transport in Kenya with the potential to mitigate 5 million tonnes of CO2 in Nairobi alone. BII’s Climate Innovation facility was designed to help scale impactful, cutting-edge technologies, with the potential to transform the lives of people and communities in Africa. We are delighted to partner with BasiGo via this facility,” said Chijiutomi.
Founded in 2021, BasiGo has led the introduction of electric buses into Nairobi’s public transport fleet.
It has deployed 19 electric buses to public transport operators in Nairobi, currently representing the largest fleet of electric buses in sub-Saharan Africa.
BasiGo electric buses have driven over 1 million kilometers, carried over 1.2 million passengers, and mitigated approximately 500 tonnes of CO2 since they began operations.
BII’s debt facility is the first of its kind supporting the electrification of the informal public transport sector in Sub-Saharan Africa. BII has existing indirect exposure to BasiGo through its investment in Novastar Fund II.
The electric buses financed by this facility will be assembled locally in Kenya, establishing a new green manufacturing hub for modern electric vehicles.
BasiGo first batch of locally assembled electric buses recently began production at Kenya Vehicle Manufacturers, one of country’s leading automotive assembly plants.
It has already received over 350 deposits from bus operators in Nairobi looking to reserve the company’s first production units. It aims to deploy 1,000 locally assembled electric buses in East Africa in the next three years.