What does the Ultra Low Emission Zone mean for small businesses?
- Created: 04 August 2017
The Mayor of London, Sadiq Khan, has revealed his plans for the Ultra Low Emission Zone (ULEZ), which will require heavy diesel vehicles to pay a daily charge if they wish to drive in central London.
Under the ULEZ's rules, diesel vans, cars, and motorbikes that don't meet the Euro 6 environmental standard will have to pay a daily charge of £12.50 to enter the zone. The same charge applies to petrol vehicles that don't meet the Euro 4 standards. Meanwhile, HGVs, buses, and coaches that don't meet the standards will be required to pay a fee of £100 per day. Keep in mind that these charges are on top of the congestion charge – which is £11.50.
The zone is planned to come into force on April 8, 2019. Starting in central London (the same area as the existing Congestion Charge zone), the ULEZ's scope is set to then widen across Greater London in 2020 and then to the North and South circular roads in 2021.
Air pollution in London has always been a major problem. Within the first five days of 2017, the city managed to breach its annual air pollution limit for nitrogen dioxide (NO2), which is mainly produced by diesel vehicles. "The air in London is lethal and I will not stand by and do nothing," Khan has said.
And while it's clearly important that all necessary measures for improving the capital's air quality are taken, there have been some concerns over what the ULEZ could mean for small businesses who rely on such vehicles to operate. Some think that Khan has given SMEs a nearly impossibly short time frame to adapt their fleets to the new system, and the cost of the transition may be too much for some businesses.
The Freight Transport Association (FTA), which represents the views of companies in the transport industry, has described the plans as "troubling" for small businesses operating in London. Natalie Chapman, FTA's head of policy for London and the south-east, said that the plans would "seriously disadvantage" companies, particularly van drivers, as it would impose unnecessary and "potentially crippling" costs on them as they try to make sure their fleets are compliant within a very short time frame.
Because of this issue, the FTA is advocating for van drivers to have a sunset period, similar to the three-year period that has already been offered to private residents living in the ULEZ, allowing them to have a discount on the fee. This would give them more time to ensure their fleets fit within the ULEZ's standards.
Chapman also voiced her support for the diesel scrappage scheme that the mayor has previously called for. The scheme will see drivers paid up to £3,500 so that they can scrap their existing diesel vehicles and replace them with more environmentally-friendly motors. Such a scheme would help relieve the financial burden on small businesses.
"At a time when London's businesses face an increasingly challenging trading environment, the mayor should be taking every possible step to help the capital's small businesses," Chapman said.
Coping with costs is always going to be a big worry for SMEs. The FTA has promised to continue exerting pressure on the mayor to consider the van drivers most affected by the ULEZ so that they're not faced with unrealistic costs.
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