Impact of ULEZ on Businesses

Thore Vestergaard, SVP & MD, FLEETCOR

Thore Vestergaard, SVP & MD, FLEETCOR

Ultra Low Emission Zones (ULEZs) are set to become a staple part of the infrastructure that surrounds our modern cities. 

But, what do they really mean for your SME business?

As of 8 April 2019, London is now a step closer to realising its aspirations for cleaner air via its first Ultra Low Emission Zone (ULEZ), which will be situated in Central London. Vehicles entering the zone will now need to meet new, tighter exhaust emission standards (or ULEZ standards) or pay an additional charge to drive within the zone. It is hoped the measure will greatly minimise air pollution caused by exhaust fumes.
 
Although cleaner air for the communities of London can only be a positive, if your business is operating in and around the ULEZ, you must take the necessary steps to assess what impact the legislation will have on your operations and the vehicles you use.
 
Taking action – what can you do to minimise the impact of ULEZ?           
        
The European emission standards are the benchmark by which vehicle emissions will be measured in the new ULEZ.
 
Below we have outlined a number of measures that you can take to ensure your fleet is compliant with the ULEZ standards, and if not, how you can minimise fees.

1. Paying and reconciling expenses as a result of the ULEZ
 
Your business will need to consider how best to pay for ULEZ, whether incurred by employees and claimed back or paid centrally by your business, particularly if the majority of a fleet is non-compliant. 

If your business is operating in and around the ULEZ, you must take the necessary steps to assess what impact the legislation will have on your operations and the vehicles you use

Payment is made through the Transport for London (TfL) website as already happens for charges such as T-charge, congestion and Dartford Crossing tolls. There are two main ways to pay depending on the size of your fleet:

• For businesses with up to five vehicles, they can register a payment card (for example Allstar Plus VISA Card) for AutoPay as a quick and convenient method. An employee can also pay as they go with any acceptable credit or debit card and claim the costs back.

• For businesses with more than five vehicles, they need to register for FleetPay. This method only allows for Direct Debits to be set up.

• Using an Allstar Plus Visa Card (whether PAYG or via AutoPay) enables drivers to manage their own ULEZ payment in a quick and efficient way and also provides businesses with better reconciliation of expenses.
 
2. Find the right tools and do your research
 
If your business relies on the ULEZ for operations, you will need to find out just how compliant your current fleet of vehicles is. To help road users do this, TfL has provided a ULEZ Vehicle Checker. By simply inputting your vehicle registration, you can find out if your vehicle is compliant with the current ULEZ standards.
 
3. Look at the fuel mix of your current fleet
 
As well as vehicle types, you should think about the fuel mix of your fleet – particularly when it comes to the vehicles you are operating in the ULEZ. 
 
Virtually all petrol cars registered since 2006 will be exempt from the ULEZ fee[1] – including those that meet the Euro 5 and 6 emissions standards. In fact, around 12.7 million of the 18.3 million petrol cars on the road are already ULEZ compliant according to the Department for Transport. As a result, it might be feasible for businesses to find cheap petrol cars that are ULEZ compliant – although this may not be an option for those businesses that operate larger fleets. However, redeployment of petrol vehicles could also be an option for operations in the Central London area.
 
Alternatively, businesses could consider using Electric Vehicles for regular trips into Central London give their exemption from the ULEZ charge. Most hybrids are also exempt from the charge too as they meet Euro 4, 5 and 6 regulations.
 
4. Navigating around the ULEZ
 
Your business should consider better planning around the routes they need to take in order to complete essential trips. One option may be for company fleets to be fitted with tracking technology which can provide information on the best routes to take for a given journey, and those routes to be avoided as a result of charges such as the ULEZ fee.
 
If you are making regular trips into the ULEZ, re-deployment of vehicles for certain journeys could be another option.
 
Why all businesses need to take the opportunity to modernise?
 
ULEZ will inevitably have a far-reaching impact across the UK. Some may not feel the need to prepare for ULEZ given its geographical location or the low frequency of the visits they make to the capital. However, all businesses need to monitor the ULEZ in London as similar schemes are planned for other major UK cities by 2020 – including Manchester and Birmingham[2]. In the short term, all businesses can make some small tweaks to their operations and play a part in shaping local infrastructure for the better.

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