London businesses urge Congestion Charge rethink

Commencing on 25th December 2024, Transport for London (TfL) announced that vehicles enjoying a £10 for a year’s exemption from congestion charges will have to pay the standard £15 daily fee. Therefore, Electric Vans will no longer be exempt from the congestion charge. This change aligns with the broader goal of the complete phasing out of petrol and diesel vehicles. TfL believes that as Electric Vans become more prevalent, maintenance of an exemption would undermine the whole purpose of the Congestion Charge, to successfully reduced traffic congestion and pollution in Central London. In addition, funds raised via the Charge have provided increased support for public transport funding, promoting a shift away from car usage in favour of more sustainable transport options like buses, trams, and the underground. All vehicles, including Electric Vans, will become subject to the Congestion Charge; this also includes electric rental vans. This policy shift emphasises the TfL belief in the need for broader measures to manage congestion and pollution, even as vehicle fleets
become cleaner.

However, more than 40 businesses have signed an open letter asking the Mayor of London to extend the current congestion charge exemption for all electric vehicles, including Electric Vans on rental.

The signatories, include Ocado, the AA and the Federation of Small Businesses, all argue the introduction of this charge – which based on £15 per day, would add up to £5,500 per Electric Van per annum – would undermine companies who had “taken on debt to invest in Electric Vans”. The FSB also said the scheme should be extended to help business owners who already face heavy costs and have invested in an electric infrastructure. Oliver Lord from campaign group Clean Cities called the change “puzzling”. He said “By offering incentives to businesses for electric vehicles, we not only promote greener transport but we also draw a line against the most polluting freight vehicles. How is it right that a dirty diesel van pays the same Charge as a cleaner electric vehicle in the most polluted part of the UK? This defies logic and the best international practice. Now is the time for the Mayor to cement his efforts for change by maintaining the exemption and working on a broader package of support for green freight across the capital.”

Transport for London was working with City Hall to “see what more could be done to mitigate the effect of this phasing out and further incentivise businesses to make the switch to cleaner vehicles”.

Supporters of the exemption have said waiving the fees for electric vehicles played “a fundamental role” in easing the cost of investing in the transition to an environmentally friendly fleet and the prospect of it ending left them “deeply troubled”.
The letter states: “Countless business owners wish to move away from dirty diesel vans and to electric alternatives, they should be supported and not hindered doing so.”

The Green Party added these incentives “these exemptions were always going to be time limited”.
Caroline Russell, Leader of the City Hall Greens, said: “If every Londoner drives an electric car we won’t tackle congestion, air pollution or the climate crisis. The best solution to any concerns about unfairness in changes like this is to move to smart, fair road user charging.”

A TfL spokesperson added: “More than 52,000 grants have been approved for Londoners, businesses and charities to switch to cleaner vehicles (including Electric Vans) with 70,000 fewer non-compliant vehicles now seen driving on London’s roads.”