Supporting Uptake of Low Emission Vehicles Through Discounts on the Central London Congestion Charge

Supporting Uptake of Low Emission Vehicles Through Discounts on the Central London Congestion Charge


James Clowes, Transport For London


This paper examines the impacts of Greener Vehicle Discounts on air quality in London


The Central London Congestion Charge was introduced by Transport for London in 2003. While primarily aiming to reduce the amount of motor vehicle traffic, the scheme also has a secondary aim to reduce emissions of CO2 and air pollutants by encouraging the use of low emission vehicles. Over the ten years the Congestion Charge has been in place there have been discounts in place for vehicles deemed to be exhibit best practice on emissions based on defined criteria.

At the time of the introduction of the scheme a full discount – the Alternative Fuel Discount (AFD) - on the charge was made available for all vehicles powered by alternative fuels, i.e. fuels other than diesel or petrol. Over the following seven years the number of alternatively fuelled vehicles observed in the zone rose and, given advancements in vehicle technology and emissions performance, the discount was reviewed in 2010. This review concluded that in order to continue to promote use of only the lowest-emitting vehicles, the AFD should be replaced with a new Greener Vehicle Discount (GVD).

The GVD, introduced in January 2011, moved to a technology-neutral approach by setting strict standards for emissions of CO2 and air pollutants which vehicles are required to meet in order to qualify. Monitoring of the impacts of the GVD showed that it was successful in its aim of increasing the number of low emission vehicles using the zone, and that the rate of uptake of low emission vehicles was faster than the background trend amongst the general vehicle parc. The responsiveness to the discount was measured, and the elasticity of demand for cars claiming GVD estimated to be -0.42, showing that the discount was an effective tool for promoting uptake of low emission vehicles.

The rate of uptake of vehicles meeting the GVD standards, along with the ever faster rate of improvements in emissions performance of vehicles, triggered another review of the discount policy in 2012. Transport for London proposed the replacement of the GVD with a new Ultra Low Emission Discount (ULED), with even stricter emissions criteria. Pending the results of a public consultation which closed in February 2013, the ULED could be introduced in summer 2013.

Provision of a discount on the Congestion Charge to encourage use of low emission vehicles has proved to be an effective policy. Through the phased implementation of stricter emissions criteria for these discounts, Transport for London has used this tool effectively over the past decade. This has realised the twin aims of encouraging acceleration in the development of low emission technologies and achieving increased uptake of vehicles deemed to exhibit best practice on emissions.


Association for European Transport