London Mayor Ken Livingstone and his team are watched and admired from around the globe for their daring leadership in implementing the London congestion charge – an £8 per day charge to drive into central London. But wanting to stay ahead, and cement a position of leadership on climate change, the mayor’s office are proposing that from next year the system changes – with what drivers pay being based on how much CO2 their car emits.
Of course, critics say this makes the system effectively a tax on emissions, rather than space, so is this an admission the original system has failed, or a re-focusing of priorities onto the topic du jour?
Currently people living inside the charging zone are 90% exempt from paying, and the system rewards technology in the form of hybrids and alternative fuel vehicles, by making them exempt – regardless of their size or actual emissions. Everybody else - from the smallest Smart car, to the biggest Cadillac Escalade; and the least polluting Polo, to the most powerful Bugatti pay a flat £8 per day.
If you could afford a Veyron would you really care about £25?
The proposals for the changed charging system, released last week, are little different to what we’d been told last year – and which we reported on in the article “’Could all out war on 4x4 cars’ change the game”. But to recap, the proposal is that:
- Cars that emit less than 120g/km of CO2 pay no Congestion charge.
- Cars that emit between 121-224g/km pay the same £8 per day, and if you live in the C-Charge zone you still get a 90% resident’s discount.
- Cars that emit more than 225g/km or that were built before 2001 and have an engine size of greater that 3,000cc will pay £25 per day – and owners living inside the charge zone will no longer be eligible for resident’s discount.
Obviously this has been met with some local outrage - presumably from people faced with the idea of paying £6000 per year simply to move their car off the drive. The Evening Standard, for instance, isn’t a great fan of Ken Livingstone, and when it woke up to this ‘news’ yesterday, got predictably upset that 25,000 people who owned ‘small cars’ would be allowed to drive into central London for free. It reported “experts fear it could send congestion levels spiralling”. Which I think misses the point. What Livingstone and his team are doing here works on several levels:
- It raises awareness. CO2 is fundamentally a dull issue, and when it comes to cars, how much CO2 a car produces is still one of the last things on the mind of the average buyer - despite heightened environmental awareness. Do you know how much CO2 your car produces per kilometre? Neither did I – but I do as of yesterday. If you’re living in or near London and thinking of buying a new car from now on, you’d be stupid not to want to know.
- It incentivises people to choose more economical, lower CO2-producing cars – which could have a knock on effect on the types of vehicle and powertrians manufacturers will offer. Have a look at the article from back in November for why we think this could push manufacturers to develop lower-emissions cars more quickly.
- That idea that people who own cars which are ‘exempt’ will start driving into town every day is open to a good degree of debate. For the majority, the biggest influencing factors on whether to drive in London are ‘will I be able to park at my destination?’, and ‘how long will the journey take?’ Even if my car was exempt (and annoyingly it isn’t, missing the 120g/km cut-off by 2 grams!), I wouldn’t drive it into central London because parking spaces are hard to find and expensive (£3-£8 per hour). And most journeys will be quicker on my bike or by tube.
If something has to be done to measure the ‘impact’ of driving, other than raising tax on fuel – which has proved wildly unpopular in the past – CO2 emissions are probably the most sensible place to start. They’re also of the moment, so although The Standard is right to label this ‘mission creep’ it’s a fairly clever direction in which to creep given the current climate of environmental awareness.
Ultimately, the ‘creep’ to an emission-based charge should position London and Livingstone at the forefront of leadership on environmental issues - which will be a good thing for the city. Many other mayors and leaders look to Livingstone’s approach to sorting out London’s transport issues as a model. While it is still far from perfect, what has been proved is that collecting money from car users and pouring it into alternative transport systems can have some effect in making a city easier to move around.
Others might read into this that we will increasingly look towards breakthrough innovations and technology to solve or manage traffic issues – as the ‘tax’ of the Congestion charge has failed, because it hasn’t reduced congestion all that much. While that’s somewhat disingenuous, what’s true is that effectively raising taxes on people driving – through fuel, road tax, or charging them to enter special zones, doesn’t ultimately seem to result in that many people giving up getting behind the wheel.
I'm betting this will be the car to be seen in next year - oh and you'll be able to drive it into London for free if these proposals go through.
One final point to watch is how vehicle ownership and usage changes. Toyota Prius sales in London have soared on the back of its Congestion-charge exemption. What will owners of £25 a day class-cars who live inside the zone do with their vehicles? - Give them up? Only use them at weekends? Buy a Smart car too? My money’s on the latter – but whatever happens, the potential impact on the future resale values of £25 per day vehicles will be fascinating – and potentially quite frightening for some owners. Ultimately, the new proposals can only stimulate demand for the burgeoning breed of funky, efficient small cars. What price the newly C-charge exempt Fiat 500 multijet being the car to be seen in, in London next summer? I’ll take mine in white please…
Posted by Joseph Simpson on 15th August 2007
Talking to a (now ex-)colleague who worked in TfL while the congestion charge was being put together originally, she was absolutely clear that the thinking at Mayor level was motivated by finding a way to tax the richest people (those living in the zone). Logic is basically tax the rich, pay for buses, help poor. That was behind the move to extend to the west, not reducing congestion. Suddenly a big chunk of (rich) people pay their 10% discounted rate for the whole year regardless of whether they drive every day or not because risking a £50 ticket just isn't worth it for 80p a day. The £25 for fast / big cars will also predominantly hit the rich so process continues. CO2 is a convenient mechanism that's all.
Posted by: Robotnik | August 21, 2007 at 08:11 PM