The Road Haulage Association (RHA) has slated plans to phase in London’s Ultra Low Emission Zone (ULEZ) 17 months ahead of schedule.
In the second part of our series on congestion charging, we look at developments in London, one of the world’s foremost global cities. The ULEZ, congestion charging, and other changes under review by the Mayor of London, Sadiq Khan, are motivated by the need for environmental improvement within London.
It was partly to improve air quality that London introduced a congestion charge zone (CCZ) in 2003. The impact of the congestion charge on traffic in London was dramatic. Research outlined in the Journal of Economic Perspectives uses a measure of congestion where minutes delayed are calculated by comparing to uncongested travel rate (during the night-time). The results of the research indicated congestion dropped an average of 30 percent from the outset of the charge in February 2003 to mid-2005.
However, according to The Economist, the congestion charging scheme has limitations and is actively being redesigned, so road users are charged according to “when, where and how much they use the roads”.
A recent report instigated by a think tank called Centre for London, entitled ‘The Commission on the Future of London’s Roads and Streets’, suggested more sophisticated forms of road pricing are realistic, as reported in Fleet News. The current contract for London’s CCZ expires in 2018.
Recently, the Mayor of London signalled a Transport Strategy review, and the public consultation for this process was completed in October. The Mayor’s Transport Strategy will be published early 2018. It is known that as part of the proposals, the Mayor wants road freight levels to be cut by 10 percent.
Also, part of his strategy is the ULEZ, where all diesel-engine vehicles will be required to meet the Euro VI emissions standard. The scheme was initially set for a start date of September 2020, but the Mayor plans to bring this forward to April 2019. A £10 ‘T-Charge’ on top of the congestion charge for older light and heavy vehicles has already been implemented as an air quality control measure. Heavy goods vehicles first registered before 1 October 2005 entering the London congestion zone could already be paying this additional cost.
The RHA’s main bone of contention is that their consultation advice for a phased-in approach has been completely ignored by the Mayor, and the new earlier implementation period will weigh heavily on hauliers. Furthermore, the RHA is adamant that hauliers should not be penalised by any retrospective regulation.
RHA chief executive Richard Burnett commented, “We are concerned that the ULEZ charge will cost many hauliers £100 per day, and that’s in addition to the other charges they already pay. More than half the GB lorry fleet will not be Euro VI when the ULEZ is introduced. Bringing the date forward by 17 months is little more than a means of quickly bringing in revenue to cover the Mayor’s other plans for the City.”
The RHA explained how these measures would result in hefty fines for all trucks registered before 2014. The RHA’s position is that business needs a longer bedding in period for a larger share of the lorry fleet to be Euro VI ultra-clean trucks. More specifically, the RHA argues that the earlier model Euro V lorries should be exempt from the scheme, as they will be just five to nine years’ old by April 2019.
The air quality in London has been the subject of much debate of late. It was recently reported in The Evening Standard that the Mayor had warned of “shocking and illegal” pollution levels in the capital in response to a series of “high alert” warnings being issued by City Hall.
The RHA is convinced the approach adopted by the Mayor will push more freight onto vans and will be counterproductive.
However, a spokesperson for the Freight Transport Association (FTA) believes the proposals are challenging even for vans. Natalie Chapman, head of policy, London, FTA, stated, “For vans, this will be particularly challenging as by April 2019 there will only be about two and a half years’ worth of compliant vehicles in the fleet and virtually no second-hand market.”
Turning to other measures to improve London’s environment, Chapman of the FTA concedes the London CCZ has arguably played a role in suppressing traffic demand in the capital and congestion would be worse without it. It costs about £1 per minute to operate a heavy goods vehicle, so any congestion spikes operating costs. The FTA added that many businesses respond to congestion by putting more vehicles on the road. This becomes a vicious circle: increased cost, increased emissions, which ultimately increases the congestion problem.
However, the organisation also considers the scheme a “blunt tool which fails to recognise the essential role that freight plays in serving London’s businesses, residents and visitors.”
According to Chapman, companies pass on the charge to their customers either as a surcharge or through higher prices, and it does little to change behaviour for freight operators as there are few alternatives.
She insisted, “The freight industry provides an essential service often making it difficult to avoid these schemes, and therefore we pay a disproportionate amount of the cost.”
The FTA is working on initiatives to enable some deliveries to be retimed to earlier in the morning, later in the evening or overnight.
She warned, “Any changes must be aligned with the need to prioritise essential freight journeys. For example, if a future charging scheme were to make it more expensive to travel in peak hours, deliveries such as express mail which are required by London’s businesses pre-9am or arguably the most time-sensitive product of all, newspapers, should be exempt. Our support for such a move would very much depend on the detail of the proposal.”