Most countries have pledged to phase out the use of internal combustion engine (ICE) cars in favor of battery electric vehicles (BEVs) as part of global efforts to cut greenhouse emissions and mitigate climate change. With governments around the world investing millions to hundreds of millions of dollars in the development of EV infrastructure and to spur electric vehicle sales, experts predict that demand for fossil fuels such as oil will peak at the end of the decade.
However, recent data has revealed that electric cars are fielding overwhelming competition from mopeds and e-bikes in several key markets. These small and lightweight transport alternatives are attracting such demand that they have quietly begun to reduce demand for oil in critical markets such as Sweden.
While there are around 20 million electric cars and 1.3 million commercial electric cars such as delivery vans, trucks and buses globally, more than 280 million electric scooters, three-wheelers, motorcycles and mopeds run on the world’s roads. Bloomberg New Energy Finance estimates that the proliferation of electric two-and three-wheelers is cutting daily oil demand by a whopping one million barrels, which is equivalent to around 1% of the globe’s total demand for oil on a daily basis.
These smaller electric vehicles solve one of the largest barriers to electric vehicle adoption: price. Unlike the majority of EV models that can cost drivers an arm and a leg to buy, electrified mopeds and e-bikes are almost laughably cheap in comparison.
On top of their affordability, electric e-bikes and mopeds are incredibly cheaper to maintain and fuel. A driver using an e-bike to travel an average of 12 miles a day from Monday to Friday would spend just $20 on charging per year. This makes e-bikes and mopeds a convenient and much more affordable transportation alternative for urban dwellers who mostly use their vehicles to cover relatively short commutes, such as shopping for groceries or taking their kids to school.
All these factors have driven the demand for such vehicles in major markets such as China and Europe to such heights that they are displacing four times as much oil demand as the entire globe’s fleet of electric cars, putting into question the notion that electric cars will be solely responsible for the globe’s transition away from dirty fuels.
Based on this data, it seems consumers in many markets are a lot more willing to switch to electric mopeds and e-bikes compared to conventional electric cars. Although most governments hinged their electrification plans on regular EVs, the growing trend of electric micromobility could help cut urban emissions by a wide margin and reduce demand for oil.
Once electric vehicles across the spectrum of manufacturers, such as those made by Nikola Corporation (NASDAQ: NKLA), deepen their penetration, the combined impact of electric micromobility and these new energy vehicles could bring the end of fossil fuels closer than previously anticipated.
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