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Final Up to date on: nineteenth April 2025, 01:16 am
Many, many instances have I learn the argument in opposition to EV adoption in growing international locations based mostly upon our (supposed) incapacity to handle an honest grid, the existence of widespread blackouts, and the resultant power insecurity. In response to this argument, individuals topic to those blackouts won’t ever change their reliable ICEVs for a brand new, doubtlessly ineffective expertise.
The catch, in fact, is that poor international locations are as more likely to face gasoline shortage as they’re to have blackouts (and possibly extra so). So, what occurs to this “reliable” expertise when gasoline turns into unavailable? Properly, let’s verify the most recent nation to have a gasoline disaster to search out out: Bolivia.
Bolivia’s predicament
Bolivia is at a crossroads.
Poor international locations are inclined to subsidize gas to some extent, typically as a measure to supply reduction to inflation, typically as a consequence of value controls that don’t account for native foreign money devaluation or the fluctuation on costs of oil. Usually, as soon as a subsidy has been established, it’s almost not possible to elevate it, as doing so universally ends in large protests (seen in recent times in Ecuador and Colombia, for instance). The truth that the lifting of those insurance policies usually goes hand in hand with generalized cuts to social spending doesn’t assist.
However I digress. In 2024, Bolivia spent over 2 billion {dollars} in gasoline and diesel subsidies, a large quantity for a rustic with its economic system (and nearly 5% of its whole funds). The nation has been having financial hassle for some time, and it principally ran out of cash to import gas a number of weeks in the past, forcing President Luis Arce to resort to their gold reserves. Sure, that’s not a typo: Arce ordered the promoting of a part of Bolivia’s gold reserves to purchase gasoline and diesel.
But gas stays scarce, and there are warnings of additional collapse of ICEV gross sales, which fell already by 50% in 2024. However there’s a silver lining right here: each the federal government and the individuals appear to think about EVs as an answer to their conundrum.
Bolivia’s authorities exempted EVs from all tariffs in 2021, however resulting from excessive costs, gross sales remained few and much between. Already by 2024, extra inexpensive EVs began to buck the pattern, although, and that 12 months 129 BEVs have been offered, reaching nearly 0.5% market share.
However this 12 months to this point, progress has been exponential:
Common BEV gross sales have gone by way of the roof, with the month-to-month common rising by a large 918%: assuming stagnant ICEV gross sales, this is able to imply 4% or so market share, however bear in mind, ICEV gross sales are falling. We sadly don’t know by how a lot, however it’s very probably that Bolivia has develop into — in report time — the fourth Latin American market so far as market share goes, and maybe the third: at this level, an 8–9% market share wouldn’t shock me. The gist of the matter is that BEV gross sales within the first two months of 2025 have almost doubled the entire for 2024:
Bolivian media has been receptive to EVs, and there’s a sure affinity with them given Bolivia’s lithium manufacturing. The nation appears to be betting on ethanol, biofuels, and EVs to resolve its disaster, although there are not any plans to cease subsidizing gas, and it’s anticipated that native manufacturing from new wells will present as much as 86% of consumption by late 2026.
Hopefully, the Bolivian individuals will understand earlier than that how significantly better it may be to change to EVs and the nation is not going to want as a lot gas sooner or later because it has calculated.
In Bolivia, we see the risks of gasoline and diesel dependence for a poor nation missing in international reserves, and the speedy pivot in the direction of EVs that may be attributable to gasoline shortage. By this metric, one would assume that blackouts would trigger the precise reverse: a slowdown in EV gross sales. However as we’ll see in Ecuador, this doesn’t appear to be the case.
Ecuador’s paradox
By means of the final fourth months of 2024, Ecuador suffered large blackouts that began with 6-hour rationing in September and grew to 12 hour rationing in November. The trigger? A mix between lack of funding and the worst drought the nation had seen in 60 years.
Blackouts resulted in December 20, however shortage shouldn’t be but solved and there are alerts that, ought to rains not include the anticipated power, rationing will begin as soon as once more. The nation can also be investing each in conventional thermal era and in photo voltaic panels, although — native media alerts — not on the required velocity to keep away from points later within the 12 months.
But, regardless of the very actual danger of blackouts, Ecuador’s BEV gross sales are additionally booming. Gross sales grew by a large 202% in February (reaching an all-time report) and by a extra average 50% in March:
Consequently, market share reached 3.3% in February, though it slowed all the way down to 1.9% in March:
This comes as a shock to me. I’d’ve anticipated EV (and significantly BEV) gross sales to stagnate and even perhaps fall below the talked about blackouts, to not nearly triple. The trigger appears to be the identical as all the time: inexpensive EVs coming from China, significantly the very fashionable BYD Yuan Professional, which leads the rankings in 2025:
A notable point out to the 2 Chevrolets (as soon as once more exhibiting up in a rating dominated by China-made automobiles) and the Audi Q8 E-Tron. It’s additionally price mentioning the Neta V, a BEV hatchback within the 11th place within the rating, which, priced at $18.990, stands out as some of the aggressive fashions out there anyplace in Latin America. Eventually, the 60 models you see from Yutong are all electrical buses.
As most international locations within the area with respectable EV adoption, Ecuador has a 0% tariff for BEVs and exempts them from visitors restrictions within the largest cities (which, it bears mentioning, aren’t as strict as different international locations’). Even then, it nonetheless surprises me to see such speedy progress as we see literal blackouts, one thing that in response to EV naysayers we weren’t purported to see. I nonetheless consider the blackouts have considerably affected adoption and we might now be seeing a lot larger market share within the nation had it not been due to them.
However Ecuador stands for instance that, even when it seems your grid is admittedly not dependable, EVs can nonetheless show themselves a viable various.
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