Why e-bikes should enjoy similar incentives to electric cars and trucks

Why e-bikes should enjoy similar incentives to electric cars and trucks

Why e-bikes should enjoy similar incentives to electric cars and trucks June 20, 2024Leave a comment

Why e-bikes should enjoy similar incentives to electric cars and trucks

For years, electric cars and trucks have enjoyed a federal tax credit as a way for the U.S. government to promote cleaner transportation. Most recently, the Inflation Reduction Act (IRA) extended the electric vehicle (EV) tax credit until at least the end of 2032.

One important EV missing from the IRA tax credit is the e-bike. E-bikes were considered in the planning of the IRA for the Electric Bicycle Act (the EPA’s Electric Bicycle Incentive Initiation Program), but they were ultimately dropped from the incentive.


Originally introduced in 2021, the Electric Bicycle Act is now sponsored by Representatives Jimmy Panetta (D-CA), Earl Blumenauer (D-Ore.), Mike Thompson (D-CA), Adam Schiff ( Adam Schiff) (Democrat, California) and Senator Brian Schatz (Democrat, Hawaii) lead the charge.

The Electric Bicycle Act would provide a 30% refundable tax credit of up to $1,500 for the purchase of a new electric bicycle. E-bikes sold for more than $8,000 would not qualify for the tax credit, which must be less than $150,000 for single filers and $300,000 for joint filers. (Read more about the Electric Bicycle Act)

E-bikes should take advantage of these electric vehicle tax credits because they are one of the most readily available electric vehicles with many advantages that make them a great car alternative. They also have low operating costs, help reduce traffic congestion, and increase daily activity to improve health.

E-bikes are one of the most attainable electric vehicles
Many people from all economic classes can benefit from being able to afford an e-bike. At around $1,000 and up, e-bikes are one of the most affordable and practical electric vehicles that can perform many of the same functions of the eCar for commuting around town and running errands.

One of the least expensive electric cars, the Chevrolet Bolt, starts at about $26,000. While the price difference is significant, electric cars offer the added value of weatherproofing, climate control, higher speeds and a range of about 250 miles. There’s no question that electric cars have more features than electric bikes, but for many people, even with the $7,500 electric car tax credit (if the car qualifies), it’s out of their budget.

Used EVs are an option, but even with a $4,000 tax credit (if the car qualifies), they’re still expensive. Let’s say you can buy a used EV for $15,000, which is optimistic, and get the $4,000 credit, but the price is still a whopping $11,000.

For many people at lower income levels, an electric car doesn’t fit into their budget, but an e-bike does.

High utility to price ratio
Compared to electric cars and trucks, e-bikes have a very high utility to price ratio.

An e-bike can do many of the things a car can do around town at a fraction of the cost of a car. E-bikes are great for commuting, running errands, taking kids to school, meeting up with friends and family around town, and more.

Ebikes combine the many conveniences of a car or truck with the benefits of a bicycle. They create a perfect combination that offers similar features of a car and the ease of using a bicycle.

With the right cargo-carrying device, such as an eCargo bike or an e-bike with a trailer, an e-bike can do many of the tasks that a car can do. It can carry bags of groceries home from the shop, transport children to and from school, pick up bulky items at the hardware shop, and more.

Another convenience of an e-bike over a traditional bike is that you can ride more easily and with less sweat. This makes it more realistic to show up to work in a decent manner while commuting on an e-bike.

Parking is a common problem for cars, but not for e-bikes. Whereas a car driver may circle around the block looking for a parking space, a bike rider can in many cases park near the entrance to their destination, and it’s free!

E bikes are inexpensive to operate
Another benefit of owning an e-bike is its lower monthly and annual operating and maintenance costs compared to an electric car. The regular costs associated with cars (such as registration fees, insurance and parking) do not apply to owning an e-bike.

The energy costs of a 60-pound e-bike, then, are lower compared to a 3,000- to 4,000-pound e-vehicle. Lower energy costs not only benefit the rider, but also put less strain on the grid, which is good for the community and the environment.

Similarly, maintenance costs such as adjustments, tyre replacement (2 tyres vs. 4), etc. will be lower.

As with electric cars or trucks, battery replacement does need to be considered over the years of ownership. Some money should be set aside each year for eventual battery replacement. Again, the replacement cost of an e-bike battery is a fraction of the cost of an electric vehicle battery.

Given the lower initial price and lower operating costs, e-bikes are a more accessible and practical electric vehicle for more people than electric cars, which have higher barriers to entry.

Electric Bike reduce traffic congestion
Promoting the use of e-bikes over electric cars or trucks also has the potential to reduce traffic congestion on city streets. This is a pain point for many cities, and encouraging more people to use e-bikes could potentially benefit the community as a whole.

Building large infrastructures for cars can be very costly. Promoting more cycling, walking and use of public transport may be a more cost-effective solution to reducing congestion and potentially eliminating some of the large infrastructure expenditures.

More Riders Need Better Infrastructure
Speaking of infrastructure, many cities could benefit from improved bicycle and pedestrian infrastructure, which is often a fraction of the cost of automotive infrastructure.

As more and more people bike and walk, it makes sense for cities to invest in safer, more comprehensive urban routes. This infrastructure will help people of all economic classes, but it will be especially beneficial to those at the lower end of the scale who can only afford to cycle or walk for transport.

Good bicycle and pedestrian infrastructure also tends to make cities more desirable places to live and visit.

Healthier transport
Riding an e-bike is also an active mode of transport that is good for both physical and mental health. Commuting to work on an e-bike contributes to regular cardiovascular activity and is much more fun than being stuck in traffic!

Many first-time e-bike riders smile at e-bikes because they are so much fun to ride. So starting the day with an e-bike and ending it is a great way to spice up the workday.

E-bikes don’t do much for physical activity, and in many cases, the stress of traffic can be harmful to everyday mental health.

Local Incentives
In the absence of federal incentives, states, counties, cities and utilities have launched other programmes to encourage more people to ride e-bikes. For example, California is rolling out a statewide e-bike incentive programme this year, but progress has been very slow. (See Update on California’s Incentives)

It’s great to see that there are a lot of programs available, but they’re not for everyone. That’s why we need an e-bike incentive programme at the federal level.

E-bikes make sense
E-bikes are quality electric vehicles that more people can own. They offer many features similar to electric cars, but at a fraction of the upfront cost and regular operating costs.

They are also an important factor in easing urban congestion and have the potential to save significant infrastructure costs. As more and more people ride bikes, cities can improve their bicycle and pedestrian infrastructure for the benefit of their communities.

Promoting active transportation also benefits the physical and mental health of commuters.

It is wise to implement federal tax incentives for e-bikes so that more people and communities can benefit from active e-mobility.

I encourage you to take action in support of the E-Bike Act by sending a note to your Representative and Senators through this ‘Bicyclist’ form, which only takes a few minutes.

Let’s inspire more people to ride e-bikes!

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