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Schatz Reintroduces Bill To Make Electric Bikes More Affordable, Help Cut Carbon Pollution, Traffic Congestion

Legislation Encourages Use Of E-Bikes, Provides Tax Credit Of Up To $1,500

WASHINGTON – U.S. Senator Brian Schatz (D-Hawai‘i) today reintroduced the Electric Bicycle Incentive Kickstart for the Environment (E-BIKE) Act, legislation to promote the use of electric bicycles, or e-bikes, through a refundable consumer tax credit. E-Bikes are increasingly being used as a cheaper, more environmentally-friendly transportation option for short trips and daily commutes that can help break the cycle of fossil fuel use.

“Transitioning to a clean energy economy includes changing the way we get around. That means transit, rail, and electric buses, cars, and bikes. Our bill will make it more affordable for working people to buy an e-bike and help get cars off the road,” said Senator Schatz, chairman of the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development.

A recent study by researchers at Portland State University found that if 15 percent of car trips were made by e-bike, carbon emissions would drop by 12 percent. Another survey also found that 46 percent of e-bike trips replaced car trips, making e-bikes an effective tool to achieve the tandem goals of reducing traffic congestion and carbon emissions. However, the cost of e-bikes remains a barrier to adoption for many—prices range from $800 to $8,000 depending on battery quality and size. While the U.S. has a current federal tax-credit for consumers who purchase an electric car, there is no current federal credit for e-bikes.

The E-BIKE Act creates a consumer tax credit that:

  • Covers 30 percent of the cost of a class 1, 2, or 3 e-bike, up to a $1,500 credit;
  • Applies to new electric bicycles that cost less than $8,000, to include cargo e-bikes;
  • Permits the purchase of one e-bike for single filers, or two for joint filers;
  • Is fully refundable, allowing lower-income riders to claim the credit; and
  • Includes electric tricycles or “e-trike” which can be beneficial for people with disabilities.

The E-BIKE Act is cosponsored by U.S. Senator Ed Markey (D-Mass.). Companion legislation has been introduced in the House of Representatives by U.S. Representatives Jimmy Panetta (D-Calif.), Earl Blumenauer (D-Ore.), Mike Thompson (D-Calif.), and Adam Schiff (D-Calif.)

The Schatz legislation is supported by PeopleForBikes, League of American Bicyclists, Sierra Club, Hawai‘i Bicycling League, the Natural Resources Defense Council, California Bicycle Coalition, Ecology Action, Environment America, CALSTART, U.S. PIRG, The National Resources Defense Council (NRDC), REI, GreenLatinos, and Ecology Action.

The full text of the bill is available here.