Diary dates: emissions charging on London’s roads

Resent due to a technical issue with the previous link to article.

Those involved with road transport (goods, utilities, construction and services, or personal travel) in London will be interested in forthcoming dates for emissions charging. The first applicable date is in roughly 6 months’ time, from 8th April 2019.

Emissions charging arises from a public health issue, which stems from poor air quality attributed to emissions of nitrogen oxides (NO_x) and particulate matter (PM). A timely reminder of the issue as it affects children’s health in London is contained in a study published in the Lancet yesterday (here) titled “Impact of London’s low emission zone on air quality and children’s respiratory health: a sequential annual cross-sectional study”. This study suggests that the impact of the current scheme (which concentrates only on PM) has been only marginally positive with greater improvement clearly being required. In this drive to reduce NO_x and PM emissions in London, various changes are to be made to the current schemes. There are to be road transport emissions charging measures in a (new) Ultra Low Emissions Zone (ULEZ) and the existing Low Emissions Zone (LEZ) will be amended (see previous article here). These charges will be in addition to the existing Congestion Charge.

The changes will take effect through amendments to the existing Greater London Low Emission Zone Charging Order, which can be found here. Amendments to the Order made in 2017 and 2018 (found here and here) have formed the ‘London Emissions Zone Charging Scheme’, which establishes the regulations for vehicles in the ULEZ and LEZ.

London Emissions Zone Charging Scheme

It is worth noting at the outset that the interrelationship between the ULEZ and LEZ creates potential for confusion in terms of charging for small, medium and large vehicles. For convenience the terms we use in this article are:

Small Vehicles means cars, small vans (under 1.205 tonnes unladen) and motorcycles.

Medium Vehicles means larger vans (1.205 tonnes to 3.5 tonnes) and minibuses.

Large Vehicles means buses and coaches over 5 tonnes and HGVs over 3.5 tonnes.

The full definitions for vehicles can be found here.

The LEZ has operated since 2008. Its geographical coverage is the Greater London area and this will remain consistent throughout the changes to emissions charging. The ULEZ is new and its geographical coverage will expand but its relevance for Large Vehicles will fluctuate.

The London Emissions Zone Charging Scheme will implement the changes to emissions charging in London in three phases:

• The first phase will see the current T-Charge (see below) replaced by the ULEZ. Geographically it will apply to the current Congestion Charge zone (i.e. Central London). This zone will apply to Small and Medium Vehicles between 8 April 2019 and 25 October 2021, and Larger Vehicles between 8 April 2019 and 26 October 2020, subject to the exemptions explained below.
• The second phase (from 26 October 2020) will affect Large Vehicles only. It will see increased standards imposed in the LEZ. At this point, Large Vehicles will no longer be subject to two separate charges for entering both the Low and Ultra Low Emission zones. Instead, larger vehicles will pay one charge for entering the (wider) LEZ, depending on the Euro Standard of the vehicle.
• The third phase will expand the boundaries of the ULEZ from the Central London zone to ‘Inner London’ from 25 October 2021. This will affect Small and Medium Vehicles.

ULEZ

Currently there is an emissions scheme operating in the same Central London zone as the Congestion Charge. It is called the T-Charge and levies a £10 daily charge on all vehicles that do not meet the relevant emissions standards.

The London Emissions Zone Charging Scheme will replace the T-Charge in Central London from 8 April 2019. Save for certain exemptions, vehicles entering the ULEZ will have to meet more stringent vehicle emissions standards or pay a daily charge.

The ULEZ is based on ‘Euro Standards’ which stipulate NO_x and PM emissions. The higher the standard number, the cleaner the vehicle’s emissions should be. Here are the applicable standards for the ULEZ, together with the daily charges that will apply if the standards are not met:

These charges will be in addition to the Congestion Charge and charges for Medium and Large Vehicles entering the LEZ in the period 8 April 2019 to 26 October 2020 (as discussed below).

The new scheme differs from the T-Charge and the Congestion Charge in that requirement to meet the relevant vehicle standard in the ULEZ will apply at all times: 24 hours a day and 365 days of the year.

ULEZ boundaries

Between 8th April 2019 and 25th October 2021, the boundary of the ULEZ will be the same as the current T-Charge and Congestion Charge zone (i.e. Central London). From 25th October 2021, the ULEZ zone will expand considerably to cover ‘Inner London’, which is defined as the areas within the South and North Circular roads.

ULEZ vehicle coverage

In terms of vehicle coverage, Small, Medium and Large Vehicles entering the ULEZ from 8th April 2019 to 25th October 2020 will be charged if they do not meet the relevant Euro Standard.

From 26th October 2020 onwards, vehicle coverage will change. Euro Standards for Large Vehicles entering the LEZ (which covers Greater London) will increase to match the ULEZ’s Euro VI Standard. As a result, Large Vehicles will be charged for entering the LEZ and will not be subject to an additional charge for entering the ULEZ.

Small and Medium Vehicles will remain subject to charge for entering the ULEZ from 26th October 2020.

LEZ

The Greater London Low Emission Zone Charging Scheme has operated since 2008 on a 24/7, 365 days a year basis. The zone covers most of Greater London (i.e. a much greater area than the Congestion Charge zone or the Inner London zone).

Currently, the LEZ applies only to Medium and Large Vehicles and the standards it imposes apply only to emissions of PM (not NO_x). The current base standard is Euro 3 for Medium Vehicles and Euro IV for Large Vehicles and there is a daily emissions charge for those applicable vehicles entering the zone which do not meet the applicable standard. The Congestion Charge additionally applies.

During the period 8th April 2019 to 26th October 2020, if an applicable Medium or Large Vehicle enters the ULEZ in Central London (with its higher emissions standards), the vehicle would pay two charges: the LEZ charge and the ULEZ charge, and also, if entered on a weekday, the Congestion Charge.

From 26 October 2020 (i.e. a year earlier than the expansion of the ULEZ for Small and Medium Vehicles), the more stringent Euro VI Standard, which applies in the ULEZ, will be extended for Large Vehicles entering the LEZ. These vehicles will need to meet Euro VI standards for both PM and NO_x in the wider LEZ (Greater London), otherwise a single charge will apply.

The charge will also change. Currently, a single daily charge of £200 for is payable by Large Vehicles if they do not meet the current Euro IV PM standard. From 26 October 2020, the charge for failing to meet this standard will increase to £300. Further, if the vehicle meets the Euro IV PM standard, but does not meet the Euro VI standard, then a charge of £100 per day will be payable if the vehicle enters the LEZ.

One change in terms of emissions charging (not congestion charging), demonstrated in the below tables, is that from 26 October 2020 it will not matter how far into the centre of London the Large Vehicle travels. No longer will they be charged differently depending on whether they enter the ULEZ. Instead, once they enter the LEZ, there will be one charge.

Example charges for a Large Vehicle

The changes on 26 October 2020 will not affect Medium Vehicles. The Euro 3 PM standard and the charge of £100 will therefore remain for these vehicles entering the LEZ. As the Euro Standard is higher in the ULEZ, Medium Vehicles will continue to pay separate charges for entering the LEZ and ULEZ, depending on which zone(s) they enter. The highest charge for a Medium Vehicle from 8 April 2019 would therefore be £112.50, being £100 under LEZ and £12.50 under ULEZ.

The Congestion Charge will also be payable for all vehicles entering Central London.

Exemptions and transition periods

There are a number of exemptions and transition periods which will apply. Current residents of what will be the ULEZ zone between 8th April 2019 and 25th October 2021 (i.e. the current Congestion Charge zone) will be granted an exemption from the ULEZ charges until the area expands to cover ‘Inner London’ on 25 October 2021. Such residents will continue to pay the T-Charge, at a discounted rate of 90% during this period. There will be no exemption (for any period) for residents living outside the Congestion Zone but within the Inner London zone.

Keepers of vehicles registered with a 'disabled' or 'disabled passenger vehicles' tax class will benefit from a sunset period until 26 October 2025 as long as their vehicle does not change tax class. Designated wheelchair-accessible PHVs will also be granted a sunset period until 26 October 2025. London-licensed taxis and vehicles that have a historic vehicle tax class will be exempt from ULEZ charging.

Certain specialist vehicles designed and built for mainly off-road use, historic vehicles before 1 January 1973 (LEZ) or 1 January 1979 (ULEZ) and vehicles operated by the Ministry of Defence, will be exempt.

Comment

The Lancet report (above) suggests that the impact to date of the current LEZ has been only marginally positive. Health professionals will be interested to understand the extent of any (positive) impact that the forthcoming charging schemes will have on public health and in particular children’s health.

Commercially these charges will be of financial and procurement interest for logistics, transport and finance managers of organisations (whether or not based in London) who rely on road transport in London (for instance those in the retail, services, construction, utilities and logistics sectors). It will also be a matter of interest for private car owners. The charging could have an impact on the second hand vehicle market.

Of course, emissions charging is not restricted to London. Various forms of charging (or other restrictions) are becoming an issue in several urban areas and in various countries. It is an issue which over the next few years is likely to complicate (at least) the financial planning of managers of long distance road transport.

Co-authored by William Caruana.