ULEZ has arrived. Here's what it means for London businesses
If your business vehicle is not ULEZ compliant, you will have to face a higher extra charge per day if you do not meet emission standards and a higher penalty charge. This can create a huge impact on your business costs, delivery/pickup times and a long-term impact on the environment. Below, we break down the 2023 expansion, costs and solutions for your business.
London-based sole traders, micro-businesses (10 or fewer employees) and registered charities are eligible to apply to scrap or retrofit a van or minibus.
What is ULEZ and where does it apply?
The Ultra Low Emission Zone (ULEZ) is an area in London where higher-polluting vehicles must pay a fee to move around. The zone is focused on improving air quality across London and operates 24 hours a day, 7 days a week, every day of the year, except Christmas Day (25th December).
The ULEZ map matches closely with the Congestion Charge Zone, but as of August 2023, it will expand to all areas within the North and South Circular roads, with the possibility to expand the scheme across the entirety of Greater London. You can see the detailed map here.
How much is it, and who will it affect?
If your vehicle does not comply with the standards you could face a daily charge if you drive anywhere within the ULEZ. Additionally, the value of ULEZ and Congestion Charge penalty charges incurred will increase from 2024. Is important to note that the annual fee to register a vehicle for Auto Pay will be removed from 30 January 2023.
Transport for London has estimated that on an average day, about 160,000 cars and 42,000 vans that use London's roads would be affected by the fee. 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
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
This could be an opportunity to reconsider how your business operates. There are several advantages to 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 pick up.
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.
