The "Co-bikes" are currently available from five sites in Exeter, including the central train station, the university and Sowton Park and Ride.
It's hoped that by spring 2017 there will be eight hubs around the city.
The initiative has been launched with support from Department of Transport, while Devon County Council has helped to fund the scheme.
Mark Hodgson, Managing Director of Co-bikes, said: "After years of planning, we're very excited to be launching Co-bikes in Exeter.
"The Co-bikes electric bikes are changing the way that people travel around the city and are affordable and easy as well as being great fun to ride", he added.
For people who choose to become members, the service will cost 75p for 30 minutes, while non-members will pay double.
The bikes have small electric motors which can travel distances of between 40 and 60 miles, and allow speeds of up to 15mph.

Most swimmers will be take to the waters of Windermere to swim a mile (1.6Km) with some longer swims scheduled for Sunday.
The event is expected to attract 10,000 swimmers, organisers said.
A 10k marathon distance has also been introduced and is expected to take experienced swimmers four hours to complete.
Great Swim Director Alex Jackson said: "The Great North Swim is proving to be as popular as ever, with 10,000 expected in Windermere for our ninth event here."
Introducing the "10k event will provide a new challenge" he added.

Charlie Girling, of the 1st Aylesford Scouts, in Kent, collapsed on Sunday at Roihu 2016, near HÃ¤meenlinna.
The UK Scout Association said the on-site medical team and local paramedics "rendered immediate support but unfortunately were unable to save him".
Spokesman Simon Carter said it was in touch with the families of the children at the jamboree, which more than 16,000 people are attending.
"We will be working with the Finnish Scout movement and the relevant local authorities to establish the full details of this tragic incident," he added.
More than 2,800 scouts from more than 40 countries are attending the jamboree in the south of Finland.
Memorial services have been held at the event in tribute to Charlie.
Anna Munsterhjelm, chief scout in Finland, said: "The Guides and Scouts of Finland and Finnjamboree Roihu express their deepest condolences to the friends and family of the tragic medical situation that resulted in the death of a scout.
"The loss has moved thousands of people within and outside the camp.
"The camp has professional crisis counsellors that are making their utmost best that everybody has the support they require." (sic)
Charlie had been a Year 7 pupil at Maplesden Noakes School, in Maidstone.
Head teacher Jane Prideaux said staff were "deeply shocked and saddened" by his death.
"He'd been with us for just a year," she said.
"He was a lively lad, well-liked by his peers and teachers," she said.
Ms Prideaux added Charlie had been a "very hard working, very able student, with a great sense of humour".
"He was full of life, and wanted to get involved in things."
The UK's first city-wide electric bike scheme has been launched in Exeter.
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Thousands of swimmers have headed to the Lake District this weekend to take part in the Great North Swim.
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A 12-year-old scout has died at an international jamboree in Finland.