While flying taxis, autonomous vehicles, and the hyperloop all have their skeptics, there is one emerging transportation technology that everyone seems to love: the electric bicycle. Its fandom comes in many forms. Policy wonks celebrate e-bikes as an environmentally friendly alternative to driving, health advocates applaud the outdoor exercise they enable, and a growing number of converts simply think they’re a hell of a lot of fun. As one self-described e-bike stan put it in Gizmodo: “Hills? No problem when your bike has a battery boost. Sweat? See ya never.”
The e-bike market is expanding quickly in the United States; half a million were imported in 2020, double from the year before. But that’s not fast enough for Democratic Reps. Jimmy Panetta of California and Earl Blumenauer of Oregon, who introduced a bill this month named the “Electric Bicycle Incentive Kickstart for the Environment Act,” or—brace yourself—the “E-BIKE Act.” If passed in its current form, the bill would offer Americans a refundable tax credit worth 30 percent of a new e-bike’s purchase price, capped at $1,500. Any e-bike or e-cargo bike costing less than $8,000 would be eligible. In practice, a purchaser of a new e-bike for $3,000 could claim a $900 credit on her following year’s tax return (and she could do so again if she buys another one three years later).
Why underwrite electric bikes? Panetta says he’s motivated by a desire to fight climate change: “This bill can lower the financial barrier to biking, and e-bikes can lower our carbon footprint,” he told me. He cites a recent study that found that a 15 percent e-bike mode share (the portion of a person’s total travel that occurs on an e-bike) would translate to a 12 percent reduction in greenhouse gas emissions from passenger transportation. The congressman is on firm ground here: An e-bike’s per-mile emissions are a fraction of those from even an electric automobile, and the e-bike’s extra pedal power makes it an appealing substitute for a car on trips that might be too distant or unpleasant for a pedal bike. The bill itself isn’t perfect, particularly because e-bike suppliers will need time to catch up to a sudden, government-prodded spike in demand. But would its passage be a big step forward for urban transportation? Yes.
It’s worth looking across the Atlantic to understand how governments can help turn drivers into cyclists. Starting with Great Britain’s Cyclescheme employee benefit program two decades ago, many European countries now leverage their tax codes to lower the cost of cycling and get people out of cars. In Germany more than 30,000 employers take part in the government’s JobRad program, which allows workers to obtain a bike or e-bike at a reduced cost. In 2018 Sweden launched a wildly popular initiative providing residents a 25 percent e-bike subsidy. And then came the coronavirus pandemic, which prompted climate-conscious policymakers in France, Italy, Portugal, and Madrid to offer a rebate worth hundreds of euros to those buying a new ride. The subsidies both encouraged a socially distanced form of exercise and nudged people away from driving.
But even proponents of these policies agree that subsidies are not a panacea, since even a cheap e-bike isn’t very appealing if you lack a safe place to cycle or a secure spot to stash it. Asked what governments should do first to encourage cycling, Kevin Mayne, the chief executive of the trade group Cycling Industries Europe, answers, “infrastructure, infrastructure, infrastructure.” Buyer rebates, he says, “are not a magic bullet. You have to think about the entire bicycle journey experience. Where are you going to ride? Where are you going to store it?” That would indicate a lower ceiling for e-bike adoption in the United States, since European streets and roads are traditionally more accommodating to cyclists. That gap has only widened during the pandemic, as leaders in places like Milan, Paris, and London have scrambled to create new places to ride, while American cities have sent mixed messages.
Europe’s years of generous investment in bike infrastructure set the stage for 2020’s subsidy programs to boost adoption of e-bikes, says Horace Dediu, an industry analyst. But the sudden surge in demand put pressure on supply, since retailers place orders well in advance. ”New e-bike orders are backlogged for months,” he says. “I was in Spain last December, and there is literally nothing on the shelves.” Dediu thinks the European bike market will eventually catch up with demand—a massive factory being built in Romania will produce 1.5 million bikes per year for Decathlon, a retailer. Mayne agrees, but for now, with demand surging and supply constrained, he believes that Europe’s new rebate programs “are bringing e-bike prices up, not down.”
Could that happen in the U.S. if Congress passes the E-BIKE Act? It’s possible. Noa Banayan, the federal affairs manager at People for Bikes (an industry association that backs the bill), acknowledged that the supply of e-bikes could be strained at first: “While we anticipate continued difficulties in the short term due to the ongoing pandemic, it will hopefully become easier to open new facilities, operate facilities at full capacity, and move products when the pandemic eases.” In other words, the market’s invisible hand could push the sticker price of e-bikes higher for a while—great for the bike industry, but not for prospective buyers.
The bill’s eligibility criteria for a rebate have also raised eyebrows. A price cap of $8,000 seems overly generous (and potentially regressive), since a serviceable e-bike might set you back $1,500 or less. Panetta points to the higher cost of e-cargo bikes as justification for a higher limit, but most new e-cargo bikes cost well below the current cap. And why exclude pedal bikes, which are cheaper than e-bikes (and were eligible under many of last year’s European rebate programs)?
Panetta claims that the bill will improve and evolve as it makes its way through Congress. “We’re still getting lots of ideas,” he says. “Already, a constituent pinged me and asked ‘what about e-bike conversion kits [that can add battery power to pedal bikes]?’ You bet—that’s something we’ll definitely consider going forward.” Panetta won’t say when he expects the bill to come to a vote, but it could be rolled into a larger transportation package. In the meantime, advocates claim they’ve already started lobbying Senators for support.
Despite its imperfections, the E-BIKE Act has a lot going for it. A surge in demand might raise prices after passage, but supply should eventually catch up and lower their cost. The crucial need for protected bike infrastructure could be addressed through other public initiatives, particularly under the aegis of bike-loving Pete Buttigieg at the Department of Transportation. And then there is the issue of parity with electric automobiles. It doesn’t make much sense to offer a $7,500 federal tax credit for a 2020 Jaguar I-PACE, which starts at $69,500, but nothing for an e-bike that costs a fraction of the cost and has a far smaller carbon footprint.
There is one other reason to back the E-BIKE Act’s passage—and to push for it to happen ASAP. As I wrote in Slate a few months into the pandemic, commuting habits are sticky and rarely up for grabs; once you start driving (or biking) you tend to keep doing so, barring a major life event. But when the pandemic finally ends, we’ll experience an unprecedented moment when millions of Americans will simultaneously decide how to reestablish their daily travels. Already, worrisome signs suggest a tilt toward driving. Post-pandemic cities would benefit for years to come if an e-bike rebate nudges commuters toward a mode that’s cleaner, healthier, and takes up less space than an automobile.
And those new e-bike owners might get hooked, building a critical mass of cyclists that can help maintain the 2020 bike boom (and keep advocating for critical infrastructure like bike lanes and storage). A graduate of bike-mad University of California–Davis, Panetta says he has seen firsthand how a community can benefit by embracing two-wheeled transport, and he thinks e-bikes are just the technology to help spread the good news. “You won’t be sweaty, because it will be so much easier to ride than a pedal bike,” he says. “I don’t want people to think of this as a fad. We want to make e-bikes available to everybody.”
Future Tense is a partnership of Slate, New America, and Arizona State University that examines emerging technologies, public policy, and society.
