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ULEZ has arrived. Here's what it means for London businesses

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ULEZ has arrived. Here's what it means for London businesses

London’s Ultra Low Emissions Zone, or ULEZ, has launched. Be informed with our need-to-know guide.  

There’s huge change for businesses driving and delivering in London. The Ultra Low Emissions Zone, or ULEZ, started in April 2019.

Here’s everything you need to know about the charge, how you can minimise its financial impact—and how it could bring positive change to your business.

What it means for your business

ULEZ replaces the T-charge—a Congestion Charging Zone, or CCZ surcharge for the most polluting vehicles. It’s a higher charge and will affect more vehicles due to its stricter criteria.

On the surface, it’s an extra, unwelcome and potentially terrifying extra expense that could cripple businesses that aren’t prepared. But it needn’t hit your bottom line. Arming yourself with all the information is crucial to avoid falling foul of the charge.

What is ULEZ and where does it apply?

london congestion

What is ULEZ and where does it apply?

The Mayor of London Sadiq Khan described London pollution as “a public health emergency”, adding that “ULEZ is exactly the sort of bold action that is required to deal with it”.

The new levy aims to “help to improve air quality and making central London a safer and more pleasant place to live, work and visit,” according to Transport for London.

The first wave will cover the existing CCZ—but on a 24/7 basis. During CCZ hours, both charges apply.

The daily charge covers midnight to midnight. If you drive in the zone at 11pm and again at 1am the following day, you’ll be charged twice.

A second wave, from October 2021, will cover all of inner London within the North and South Circular roads. So even businesses that rarely, if ever, enter central London should consider bringing their fleets up to standard.

How much is it, and who will it affect?

london traffic

How much is it, and who will it affect?

The charge applies to all vehicles that fail to meet ULEZ standards—far stricter than those of the preceding Low Emission Zone. Cars, motorbikes and vans will pay £12.50 daily, while heavier lorries, buses and coaches will pay £100 per day.

That could prove prohibitively expensive for many small businesses and particularly those offering deliveries. If their vehicles fall foul of ULEZ, they face a tough choice: cease delivering within the zone, pass the charges on to customers, or take steps to make their operations more sustainable and flexible.

However your business can take steps to minimise or even neutralise the impact. And brightening your company’s green credentials could actually be a positive side-effect that needn’t cost the earth.

Upgrade your vehicles

sunny london traffic

Upgrade your vehicles

The obvious solution is to bring your fleet up to standards, though that could prove costly for businesses where mobility is key, like delivery services. Consider leasing rather than purchasing. That way, you can spread costs and include the vehicles as a tax-deductible operating expense.

If you have a van or bus that would be costly to replace, consider retrofitting with emissions-reducing technology. The Energy Savings Trust website has details of what can be done, including replacing an older engine and fitting a diesel particulate filter (DPF).

 

Join a car club

car club bay

Join a car club

This could be an opportunity to reconsider how your business operates. Rather than scrabbling around for extra cash, consider scrapping your fleet altogether and replacing it with a virtual pool of vehicles, on hand when and where you need them.

There are several advantages to ditching vehicle ownership in favour of joining a vehicle-sharing scheme. You can scrap the accounts column dedicated to repairs, maintenance and tax (and the rest) for a start. You don’t have to worry about parking or having a secure space to store your fleet. And you can select the vehicle that’s most fit for purpose, whether that’s making an important delivery or picking up a client.

Transport, mobility and our cities themselves are in a constant state of flux, and that means businesses need to be agile. That’s why car clubs like Zipcar for Business are not only ULEZ compliant: staying on top of new legislation and trends, and adapting with them, is part of their job. For small businesses, that means less risk—and a fleet that’s practically future-proof.

Consider a grant

zipcar van

Consider a grant

New electric vehicles may qualify for a plug-in grant of up to £3,500 for cars and £8,000 for vans. Find a list of eligible models here.

The Mayor of London, Sadiq Khan, also launched a £23million scrappage scheme to help ‘micro businesses’ (those with 10 or fewer employees) and charities switch older vehicles for ULEZ-compliant ones.

“Vans criss-cross the capital making journeys that are crucial for London’s economy,” said Steve Gooding from motoring association RAC. “Helping smaller businesses, with limited cash flow, trade up to newer cleaner vehicles faster than they could do otherwise makes sense.”

Gerry Keaney, from the British Vehicle Rental & Leasing Association (BVRLA), added that “car clubs will also play a vital role in helping businesses and individuals make the shift to cleaner, ULEZ-compliant motoring from April 2019.” 

ULEZ could put the capital at the forefront when it comes to tackling pollution and shaking up the idea of vehicle ownership. Other major cities will be watching how London implements, and ultimately benefits from, the scheme.  And, if they follow suit, the positive impact on the environment and quality of life could be huge.

The charge clearly presents a challenge for businesses driving in London. But with a bit of adapting and thinking about driving and delivering in a new way, it could also present an opportunity to be at the forefront of the future of mobility.

Get up to £7,000 driving credit

Sign up to Zipcar for Business’s unique offering in support of the roll out of ULEZ in London in collaboration with TFL’s Diesel Scrappage Scheme.

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