The Undervalued Role of Micro-Mobility in the Energy Transition
Most people who talk about the energy transition mostly talk about two things: renewable energy and electric cars. When we talk about micro-mobility, that sounds cute, and maybe even cool, but it’s not as important as cars.
Wrong.
Electrified micro-mobility has already reduced more demand for oil than electric cars. In fact, it has reduced oil demand more than all other vehicle segments combined according to Bloomberg. The fleet of 2-3 wheelers is 7.5x larger than that of electric cars and is currently the only vehicle segment on track for net zero in 2050.
The IPCC also illustrates the potential of micro-mobility in their last assessment report that lists the most impactful behaviour changes on the demand-side. Switching to a battery electric vehicle (BEV) is one of the most important behaviour change improvements one can do to reduce emissions. But the single most impactful action is taking a car off the road all together.
Micro-mobility thus already represents one of the strongest opportunities to significantly speed up the electrification and decarbonisation of transport, particularly in urban areas where the average journey tends to be shorter.
However, there are two interesting insights hidden in the statistics on 2 and 3 wheelers that show us where the opportunities for micro-mobility will emerge in the next few years:
I’d like to illustrate the potential for micro-mobility in markets outside of China using e-cargo bikes in the UK as a case study. First, let’s take a look at why micro-mobility offers such strong potential.
The brutal efficiency of e-cargo bikes
The reason e-cargo bikes are an interesting part of the micro-mobility ecosystem is that they are very capable of replacing many short car journeys, whether it is the weekly shop, carrying a few kids around to school, or bringing some gear along to sports practice. They do all this without demanding great physical exertion, enabling people who do not have the strength of an athlete to continue the ride into work after without breaking a sweat.
In a congested city like London, Electric cargo bikes are also usually the fastest way to get around while hauling anything for trips under 10 miles. The many health and socio-economic benefits of cycling have been covered extensively elsewhere so I will not go into any detail on them here.
The beauty of electric cars is their amazing efficiency advantages over fossil cars. Electric cars are 3-4x more efficient per kilometre travelled than fossil cars. That’s incredible, but they are still 2 tonne hippopotami powered by an energy system that is a long way off from zero carbon. An e-cargo bike is in turn 10x more efficient than an average electric car.
From an engineering first principles point of view, e-bikes make a lot more sense as an efficient way of getting from A to B. Venture capitalists also keep on telling me they like products that are an order of magnitude better than the status quo.
The overall implications for net-zero are easy to understand. The production of a typical electric car generates around 10 tonnes of CO₂e, most of which comes from battery production. Because they lack batteries, fossil cars have lower production emissions, but the fossil car soon becomes more polluting as a result of the electric car’s superior efficiency and the lower carbon intensity of the grid compared to, well, burning oil. There is no question that electric cars are much better for the climate, but the fact that the production emissions are worse has led to incredible amounts of disinformation and confusion among consumers.
In contrast, an e-cargo bike’s production generates around 0.3 tonnes of CO₂. This is more than non-cargo e-bikes and bike bikes but still 97% lower than that of an average electric car. Combine that with that 10x improvement in efficiency to get from A to B, and we are getting very close to net-zero mobility. As a bonus, it’s happening now, today, not in an aspirational future when battery production, steel production, and the grid are all powered by renewables and emit close to zero carbon.
Now, if I weren’t part of the urban, liberal, cultural, media, 15-min city elite infected with the woke mind virus, I would say that this sounds nice in utopian theory but it is completely unrealistic. People need cars. And yes, many people do rely on cars. But let us dive into that cesspool that is modern urban life and see what we find.
Case study: an opportunity for e-cargo bikes in the UK
Taking the UK as a case study to illustrate the e-cargo bike opportunity, the Department for Transport shows that a third of households in urban areas in the UK own more than one car.** This represents 6.5 million cars in the UK alone. These second cars are often used for shorter, local journeys. The tend to be smaller, but also older and less efficient than the primary car.
DfT data also states that more than half (about 58%) of car trips in urban areas are less than 5 miles.
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Switching 50% of second cars in urban areas in the UK to e-cargo bikes could remove more than 3 million fossil cars in the UK alone, representing around 10% of all cars in the country. The carbon emissions reduction from not running these cars would be around 5 MTCO2e, which is around 8% of the annual carbon footprint of cars in the UK.
However, were we to instead switch 3 million fossil cars to electric cars, we would have to spend 30 MTCO2e to produce those cars (potentially less if we take into account that these second cars are normally smaller, but EV production emission data varies between studies). We would then have to drive the electric cars for a couple of years to break even compared to if we had bought new fossil cars instead. The beauty with e-cargo bikes is that this all becomes almost irrelevant. Instead we just avoid another 1.2 MTCO2e annually that even electric second cars would continue to emit while the grid is decarbonising.
The wider opportunity in the EU and US
If we broaden the perspective of the case study to the US and EU, the European Union has around 170 million households living in urban areas. Second car ownership rates are not available for urban households specifically, but are estimated at 25% on average. This gives us another 42M second cars in urban areas or 21M if half of them were to switch to a cargo bike.
Looking at the US, there are 80 million urban households and car ownership is about 35%, giving us a total of 28M second cars or 14M if 50% switch to a cargo bike.
As an initial estimate based on available data, this would give us a total of 38M second cars in urban areas across UK, EU and US. This represents around 7% of the total number of cars, and remember, our scope here is quite limited - switching half of second cars in urban areas. If we look at car journeys overall, the majority are so short that they would be faster, cheaper, healthier and more sustainable on a bike. There will be much more low-hanging fruit as we look at the full spectrum of micro-mobility solutions for a broader range of use-cases.
The demand for e-cargo bikes
Electric cargo bikes, like electric cars, are rapidly increasing in sales and coming down in price to get ready for mass market adoption. UK E-cargo bike volume sales grew by 37% in 2023 (the latest publicly available data). In the same period sales grew by 36% in Europe and in the US by over 50%. Total sales across these regions are only around 150,000 so the industry needs to continue this rapid growth for a few more years to be able to address the opportunity outlined in this article to attract 38M households to switch their second car.
The good news here is that e-cargo bikes rely on the same battery and powertrain technology as regular e-bikes that are already selling in the millions in these markets, and have already reached majority market share of sales in many European markets. China has also already shown that scaling quickly is possible and as China reaches market saturation there will also be many bikes produced for the domestic market looking for new markets to expand into.
Micro-mobility’s role in accelerating the energy transition
The electrification of cars is critical to achieving net zero, but micro-mobility offers a complementary solution that can accelerate the tempo of the energy transition. As we have seen in a previous article, one key barrier to EV adoption is cost, another is the availability of reliable charging infrastructure. Electric cargo bike are low-cost replacements for electric cars, and require minimal changing infrastructure to be deployed (most current e-cargo bikes simply plug into a wall socket).
By complementing the adoption of EVs, e-cargo bikes can play a pivotal role in a sustainable transport system alongside other micro-mobility solutions. Cities like Copenhagen, Hangzhou and Portland are living examples of how mass-adoption of e-bikes can lead to significant emissions reductions and improved quality of life. However, the untapped opportunity is consequently much larger in other markets.
The undervalued potential of micro-mobility in the energy transition lies not just in the direct emissions reductions, but in its ability to change the way we think about urban transport, now that most of us live in cities. E-cargo bikes illustrate one scalable solution as part of the wider micro-mobility opportunity, and should be a key part of any sustainable transportation strategy.
It’s time to take micro-mobility seriously in the energy transition. The potential is too great, and the stakes are too high, overlook them. We can reshape our cities, making them more liveable, healthier, and sustainable.
In a coming article we will move on to the human and behavioural triggers and barriers on the demand-side that determine to what extent e-bikes will be part of the solution. Stay tuned and subscribe to my newsletter to get the next article delivered to you.
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Sources:
CEO & Founder @ Payaca | CRM, Renewable Energy Solutions | Ex OVO
2moLove this but I feel like the struggle will be changing our culture to enable it. Having spent the weekend cycling in Belgium the contrast in how you are treated on two wheels is stark. The infrastructure is everywhere, drivers always give way and look out for you. It’s a joy to ride, the majority are just getting from A to B. Compare that with the UK where you feel constantly at risk and often abused for simply existing on 2 wheels. I just don’t know how we can adapt from here to enable the masses.