Governments Should Subsidize E-Bikes, Not Gasoline Prices

Why not challenge climate change and Vladimir Putin at the same time?

Urban Arrow e-bike
Subsidize this—e-bikes.

Gazelle/Urban Arrow

In California, Governor Gavin Newsom is proposing a tax rebate to help offset the increases in the price of gas. It's not quite figured out yet, but his economic adviser DeDe Myers says in a tweet: "You’ll have to be a California resident and you’ll have to own a car and we’ll go from there.”

The governors of six other states have urged Congress to suspend the federal gas tax for the rest of the year. Bloomberg reports that the governors wrote to congressional leaders: “Money saved at the pump translates into dollars back in consumers’ pockets for groceries, childcare, rent and more.”

One would think that if your worry is people needing money for groceries, childcare, and rent, then the subsidies should go to everyone—not just the owners of cars. Or, in a time when much of Europe is desperately looking for alternative sources of gas and oil, it would not make sense to encourage people to keep driving as much as they did, which is the effect these tax cuts would have.

One would think it would make more sense to invest in alternatives to driving, both for environmental but also political reasons, given that the American oil and gas saved could be exported to Europe to replace Russian fuels. Reducing demand for a product also tends to reduce its cost. But then, drivers have a special place in the hearts of North American politicians. So why not encourage them to look at alternatives to the car? How about subsidizing bikes, cargo bikes, and e-bikes instead of cars?

percent of trips graphic
Percent of trips by distance.


We have noted previously that, according to an INRIX study, 48% of trips in American cities are less than 3 miles long. We have noted another English study that found e-bikes have a much more transformational effect in suburbs and lower-density areas, where distances are longer and there are fewer alternatives like walking or transit.

Now, author and journalist Peter Walker writes in The Guardian about a study finding: "67% of Britons who might be interested in buying an e-bike are put off by the price. But of these, the poll said, 53% would be likely to buy one if there was a hypothetical subsidy of £250 on a £1,000 model." Given the complaints one hears in North America about the price of e-bikes, it is likely there would be the same reaction here. Scott Purchas of Bike is Best, the group sponsoring the study, tells Walker:

“The future is electric but not in the way people might think. All of the focus for subsidies has been for electric cars, but this new report demonstrates the substantial benefits of electric bikes and how essential they are for rapidly decarbonising transport, improving our health and cleaning up the air at the same time.”

And, one might add, reducing the need for gasoline. It is a good time to consider this. We have noted before that in the face of the pandemic, improved bike infrastructure was rolled out in a matter of weeks and the number of people riding bikes exploded. People do change their habits in a crisis and we are in a different crisis now.

Even MarketWatch, a financial news site owned by Rupert Murdoch's Dow Jones network, is jumping on the e-bike bandwagon as an answer to the problem of high gas prices.

Megan Ramey notes after riding her e-cargo bike to the hardware store:

"Record gas prices have Americans talking. Thinking of the men who approached me at the hardware store, I say the following with an excited voice: e-bikes are a solution – and a much cheaper solution than that electric vehicle you’re now thinking about."

She also compares the cost of buying and operating a not-inexpensive e-cargo bike to a car, noting that compared to the roughly $10,000 per year it takes to own and run a car, a fancy $6,000 Urban Arrow looks like a good deal.

Ramey acknowledges that a "big concern is vulnerability because of traffic." This is why it is probably more important for governments to invest in safe places to ride than it is for them to give subsidies for e-bikes.

This is where it gets difficult: When even so-called environmentalists who do "eco strategy" don't realize that bike lanes generally look empty because people do not get stuck in them, it's clear that we have a problem. But this photo in the tweet above is from Toronto, where I live, and I have driven under that bridge hundreds of times; there are few other routes. Every single time I have worried about whether I was going to come out alive at the other end, with all the cars speeding into the darkness. If we are going to get people out of cars and onto e-bikes, they have to feel safe.

In any case, most Americans live in the suburbs, which can be unlocked by the e-bike and where the road allowances are wider and the installation of a bike lane is likely not as disruptive. And while it is often said that "not everyone can ride an e-bike," it is equally true that not everyone can drive a car. And, as we noted previously, if you want to get people off gasoline, whether to fight climate change or Vladimir Putin—be it speed of rollout, cost, equity, safety, the space taken for driving or parking, embodied carbon or operating energy—bikes, e-bikes, and e-cargo bikes are the best choice for the majority of the population.  

So why not take the millions, possibly billions, in these proposed subsidies for drivers, and put it into e-bike subsidies and bike infrastructure, and get a permanent change instead of a short-term band-aid solution? Get some real value for your tax dollars.

View Article Sources
  1. Reed, Trevor. "Micromobility Potential in the US, UK and Germany." INRIX, 2019.

  2. Anable, Jillian. "E-Bike Carbon Savings- How Much and Where?" Creds, 2020.