In the past weeks, two regulatory actions related to electric bicycles from the EU and Israel made minor headlines. The EU found that China was dumping electric bicycles on the EU, and Israel announced that as of January 1st, 2019, electric bicycle riders would have to get a license. This article is focused on the EU regulation and related implications, while a second article will cover the Israel shift.
This article is part of the series leading to a major CleanTechnica report on disruption and innovation in the two-wheeled motorized vehicle space. Past articles have included the innovative disruption facing the space from electric-assist bicycles, the challenges facing major motorcycle firms such as BMW and Harley-Davidson, the different issues facing startups such as Zero and Alta, the unexpected impacts that are emerging, what’s driving the transition, and the prevalence of retro design in the space.
Have an insight that’s important or a portion of the space that the series hasn’t covered? Get in touch via comments or email.
Let’s start a couple of obvious statements. Electric bicycles are now big business, with $1.5 billion USD in global revenue across players large and small around the world. Electric bicycles are also excellent additions to urban areas, increasing health and reducing congestion.
Historically, EU regulations have shaped the electric bicycle manufacturing space, but that’s fading. One of the formative pieces is BS EN 15194 which gives requirements for electric power assisted cycles (EPAC, just to add to acronym and abbreviation confusion). It covers:
electrically power assisted cycles of a type which have a maximum continuous rated power of 0,25 kW, of which the output is progressively reduced and finally cut off as the vehicle reaches a speed of 25 km/h, or sooner, if the cyclist stops pedalling.
The regulation is deep, giving regulatory requirements for batteries, cables, electromagnetic compatibility, and aspects of power. Historically, the EU has been a primary market for electric bicycles. Its regulations have shaped what we think of when we think of electric bicycles and how they operate.
Those regulations provide guidance for classes of vehicles not covered by Directive 2002/24/EC of the European Parliament and of the Council of 18 March 2002 relating to the type-approval of two or three-wheel motor vehicles. Basically, it’s defining things that aren’t motorcycles and how they are regulated.
The speed is important, as is the pedal-assistance. All of the electric bicycles manufactured in Europe by larger players such Riese & Muller, Scott Sports SA, George Fritzmeier, and the Accell Group comply automatically with these regulations. As they were leading regulations in this space, they’ve been studied by regulators globally. But more importantly, most Chinese and Taiwanese electric bike manufacturers considered these regulations and how to be seen to comply with them, with an eye to accessing the lucrative EU market.
Certainly EU citizens wanted access to less expensive electric bicycles, as the EU manufacturers average over US$5,200 for their products.
Secondary markets such as the USA had tended to receive EU regulation-compliant bikes historically as well for simplicity’s sake, but things are changing as markets grow.
The Portland University Transportation Research and Education Center (TREC) did a late 2017 summary of electric and motorized bicycle regulation across all US states and Canadian provinces. Only 42 of the 63 jurisdictions had regulations for electric bicycles, with the rest grandfathering them under low-speed motorized bicycles, and they are all over the map after that. Most require pedals, but some don’t. Speeds vary from no limits to 19 mph / 31 kph to 31 mph / 50 kph. Power output maximums vary from no requirements to 500 Watts to 1,500 Watts compared to the 250 Watts in the EU.
Only California is big enough at 40 million citizens with enough electric bicycle penetration by itself to represent an attractive market for differentiated products from major manufacturers in China and Taiwan. Its 20 mph and 750 Watt limit tend to dominate in the USA where EU regulated products aren’t offered instead.
Mainland China itself has a variety of regulations, with unpedaled bicycles under 20 kph getting a free pass, and pedal-assist bicycles with speeds up to 30 kph remaining unlicensed. There are moves afoot to introduce stricter requirements for electric bicycles.
These regulations all apply to electric bicycles on roads, of course. Offroad bikes can have any power that manufacturers can shove into the frame, sometimes with a road-setting switch so that they ‘comply’ when used on city streets.
What this all has led to is a variety of Chinese manufacturers providing bicycles with different and mostly bypassable settings for different markets. It’s cheaper to build something bigger and faster and artificially limit it than to build multiple products. This isn’t dissimilar to Tesla’s historic practice of offering 60 KWH battery vehicles which were software upgradeable to 70 KWH, the only difference is access to the extra battery. And it’s also led to a number of electric assist bicycles with power controls on the handlebars allowing them to be operated as low-speed electric motorcycles without pedaling, under the assumption that enforcement will be light.
And enforcement has been light. It’s possible to regulate the requirements, and to check the crates, but it’s very difficult to tell what any electric bicycle is capable of from the outside. It’s even more difficult to prevent someone from removing inhibitors after the fact on ‘legal’ bicycles, especially when so many of them are designed for that purpose, often with a simple handlebar switch. Law enforcement has for the most part not spent a lot of time chasing potentially non-compliant bicycles either. But that’s changing in some places for different reasons. That’s the upcoming article.
Back to the EU’s recent decision. It found that China, with Giant China named specifically, was dumping electric bicycles in the EU at artificially low prices. However, it wasn’t that the companies were selling at negative margin, but that the Chinese government was making it possible for them to build electric bicycles much more cheaply. Aluminum market interventions, land use rights and preferential tax treatment all led to Chinese electric bicycle companies to sell equivalent products at much lower prices. And so the EU is protecting EU manufacturers by imposing stiff duties on Chinese electric bicycles. This appears to be a subset of China’s plan to own electric transportation globally, and a part of the inevitable range of responses.
Global regulations about what electric bicycles can be and do are all over the map. Innovation is moving faster than regulation.