Telematics Guides | The impact of ULEZ on London businesses

The impact of ULEZ on London businesses

London’s Ultra Low Emission Zone has been controversial since its introduction. With plans for expansion, the unease is now greater than ever.

In this guide, we’ll explain what the ULEZ is, how it works, how it impacts your business and we’ll propose some solutions to manage it.

ULEZ expansion sign

What is ULEZ?

ULEZ stands for Ultra Low Emission Zone and covers most part of London, with plans to expand all over the capital. It aims to reduce air pollution by charging drivers of high-polluting vehicles to enter the designated area.

The ULEZ in London was also designed to encourage the use of low-emission vehicles and transition businesses and road users towards a time where electric vehicles become the norm.

ULEZ benefits

The benefits of ULEZ are all about health and a more sustainable future. Including how it:

  • Improves air quality in London by reducing the number of polluting vehicles on the roads.
  • Encourages the use of low emission vehicles and promotes the development of cleaner technologies.
  • Reduces harmful nitrogen dioxide (NO2) emissions by 45% in the zone.
  • Could also reduce the number of premature deaths caused by air pollution in London.

All about London’s ULEZ

The Ultra Low Emission Zone (ULEZ) aims to clean up London’s air. It operates 24/7 every day of the year, except Christmas Day. Here’s a lowdown on all the details you need to know.

What area does ULEZ cover?

The zone currently covers all areas within the North and South Circular Roads. The North Circular (A406) and South Circular (A205) roads are not in the zone.

Is ULEZ expanding?

Yes, and that’s not breaking news. The Ultra Low Emission Zone in London has been expanding ever since it was first introduced in April 2019.

But a bigger ULEZ expansion is coming soon as it’s going to include all London boroughs from 29 August 2023.

How much is the ULEZ charge?

Vehicles that don’t meet the ULEZ emission standard and aren’t exempt, have to pay a daily charge of £12.50 to enter the designated area. That includes:

  • Cars
  • Motorcycles
  • Vans
  • Specialist vehicles (up to and including 3.5 tonnes)
  • Minibuses (up to and including 5 tonnes)

Exceptions apply to lorries, vans and specialist heavy vehicles (all over 3.5 tonnes) and buses, minibuses and coaches (over 5 tonnes).

These vehicles don’t have to the pay the ULEZ charge, but they’ll need to pay London’s LEZ charge if they don’t meet the Low Emission Zone (LEZ) emissions standard.

What other charges apply to vehicles driving in London?

Be aware, the ULEZ is not the only charge applicable to drivers entering London.

The Congestion Charge zone applies to central London and is in effect between 07:00-18:00 Mon-Fri, 12:00-18:00 Sat-Sun and bank holidays. There’s no charge between Christmas Day and New Year’s Day bank holiday (inclusive).

The Congestion Charge is £15 a day if you drive between the times and on the days mentioned above.

Exemptions from the Congestion Charge include:

  • Two-wheeled motorbikes (and sidecars) and mopeds.
  • Emergency service vehicles, such as ambulances and fire engines, which have a taxation class of ‘ambulance’ or ‘fire engine’ on the date of travel.
  • NHS vehicles that are exempt from vehicle tax.
  • Vehicles used by disabled people that are exempt from vehicle tax and have a ‘disabled’ taxation class.
  • Vehicles for more than one disabled person (for example Dial-a-Ride) that are exempt from vehicle tax and have a ‘disabled’ taxation class.

Then there’s the Low Emission Zone (LEZ) that was set up to encourage the transition to cleaner vehicles and ditch heavy polluting diesel vehicles. The LEZ applies 24/7 every day of the year, with no exceptions.

Most vehicles meet the LEZ standards, but those who don’t have to pay a pricey daily charge:

  • £100 for vans or specialist diesel vehicles (over 1.205 tonnes unladen weight up to 3.5 tonnes gross vehicle weight) or minibuses (up to 5 tonnes) which do not meet Euro 3 standards.
  • £100 for HGVs, lorries, vans and specialist heavy vehicles over 3.5 tonnes as well as buses/minibuses and coaches over 5 tonnes which do not meet Euro 6 (NOx and PM) standards, but meet Euro 4 (PM).
  • £300 for HGVs, lorries, vans and specialist heavy vehicles over 3.5 tonnes as well as buses/minibuses and coaches over 5 tonnes which do not meet Euro 6 (PM).

Also, HGV drivers be warned. If you drive an HGV over 12 tonnes in Greater London at any time you will need an HGV Safety Permit to show your vehicle meets the new Direct Vision Standard (DVS). Otherwise, you’ll be subject to a penalty charge notice.

How to pay the ULEZ charge

If you drive into the designated Ultra Low Emission Charge and your vehicle is not ULEZ-compliant, keep in mind you can pay by midnight on the third day following the journey or up to 90 days in advance. Failing to pay on time can get you a Penalty Charge Notice (PCN).

Pay the £12.50/day charge on the TfL website. Or set up an Auto Pay for any Congestion Charges and ULEZ charges and the amount you owe will be drawn automatically from your account every month.

Is my vehicle ULEZ compliant?

According to TfL, 9 out of 10 cars seen driving in outer London are already ULEZ-compliant cars.

ULEZ-compliant vehicles are those that meet the ULEZ emissions standards. In short:

  • Petrol cars and vans: Euro 4 emissions standard (generally those registered with the DVLA after 2005).
  • Diesel cars and vans: Euro 6 emissions standard (generally those registered with the DVLA after September 2015).

The easiest way to find out if your vehicle is ULEZ-compliant is to use the TfL ULEZ checker.

What vehicles are exempt from ULEZ?

Some drivers and vehicles can get an exemption or a discount on charges. Including:

  • Vehicles for disabled people
  • NHS patient payments (people too ill to attend appointments)
  • Taxis
  • Minibuses for community transport
  • Wheelchair accessible private hire vehicles (PHVs)
  • Historic vehicles
  • Specialist vehicles like farming, military, mobile cranes and excavators

You can check the full list and details, plus make an application, on the discounts and exemptions on TfL.

The controversies of ULEZ

ULEZ sign

Not all businesses and road users agree with ULEZ and the main concerns you’ll hear about ULEZ in London include:

  • The ULEZ is thought to be an additional financial burden on drivers, especially those who own older, more polluting vehicles.
  • Some argue it unfairly targets low-income individuals and small businesses who can’t afford to upgrade their vehicles or pay the daily charge.
  • Another concern is it’ll lead to more congestion as drivers seek alternative routes to avoid the zone.
  • Some say the ULEZ is not a comprehensive solution to London’s air pollution problem and more needs to be done to address other sources of pollution, like construction sites and shipping.

Whether you agree or not with the introduction of ULEZ, one thing is clear—it’s soon going to cover all of London.

Prepare your business for ULEZ

Every business will be affected by these laws. Even if it’s not bothering you now, it will eventually.

That means it’s important to prepare so it doesn’t cause your business problems later.

We’ve got some tips for you on how to do that. We can find the best solutions for your business to help you cope with the ULEZ.

Future-proof your business with ULEZ compliant vans

If you have an older van, you’ll be paying up to £3,000 a year to work in the zone.

To get around that, you can think about hiring vans that are ULEZ friendly. You can hire a fleet for a fraction of the cost of buying and get the cost saving benefits thrown in on top of that.

You can check out our guide to ultra-low emission zone vans to help you make a choice. Or compare the market right now for the best deal.

Get some electric vehicles (EVs)

We get it. Electric vehicles aren’t cheap! But they also offer excellent long-term investment, not least because they don’t have to pay any ULEZ charges.

There’s a great choice of electric cars, motorcycles and vans on the market.

And you can get government grants for electric vehicles, which can help your business with the cost of moving away diesel and petrol vehicles.

One common tactic for businesses is to hire EVs. That way you can use them flexibly for as long as you need, without having to fork out for the full upfront cost.

Then you can use the EVs for as long as you want. All without having to face emissions charges, which sure mount up over each month.

Use money-saving telematics

Telematics devices are a real money saver! You can use them to:

  • Plan different routes for your drivers to avoid the ULEZ
  • Re-route them in real-time if they run into traffic
  • Monitor drivers to make sure they’re avoiding charges
  • Track your drivers’ use of petrol or diesel

On that final point, telematics systems have a range of data on driving behaviours, which you can use to reduce fuel consumption. Plus, there are telematics systems that can integrate your business fuel cards for extra convenience and savings.

Telematics helps here because you can’t always avoid emissions charges. But with these systems on your fleet, you can limit them. And all while driving in a more environmentally friendly way. You can check out our business guide to what telematics means for more details.

Or compare the market to equip your business with money saving gadgets.

Get eCargo bikes

eCargo bikes are bicycles that can carry small payloads and use an electric motor. Plus, they have no tailpipe emissions. And that’s the big winner right there.

If you’re a delivery company, you can get these for your fleet. While they can’t carry huge payloads, they’re very effective around the busy streets of London.

Even better, check out a grant for an eCargo bike. The Department for Transport (DfT) has made £2 million of funding available to help companies purchase eCargo bikes. So, do some research to see if you can benefit.

Get ready for more emissions charges

Whether businesses like it or not, the ULEZ charges are here to stay. And the area covered is expanding.

The best thing your business can do is be prepared.

You can take up a few strategies to limit the charges for your business. One of your best options is to invest in market-leading technologies that can support your business. Like telematics, EV hire or charging points for your EV fleet. You can get a variety to help you avoid, and deal with, ULEZ charges.

The good news is they’re at great value, too! Compare the market to discover the latest EV technology within your budget. Stay informed about your fleet, charge points and everything in between.

At iCompario, we’ll help you find the best solutions for your business. Whether it’s vehicle tracking and telematics you’re looking for, EV solutions, fuel cards or others.

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