Air quality in our cities is consistently improving, with nitrogen dioxide emissions falling by almost 70% between 1970 and 2015 in the UK*. But with the government’s ambition to reduce the country’s greenhouse gas emissions by 80% by 2050, much more work is needed to bring emissions to the lowest levels possible. A patchwork of regulations, including Clean Air Zones (CAZs) and Zero Emissions Zones (ZEZs), is due to be introduced, in 2019 and beyond, to improve air quality across the UK.
In the North East of England, Newcastle, Gateshead & North Tyneside is the only region set to introduce a charging air quality scheme in the near future; Middlesbrough Council recently had its decision to reject a CAZ approved by the government. Newcastle, Gateshead and North Tyneside will adopt one of two options: the first option is a CAZ; the second is a Low Emission Zone (LEZ) with tolls across the three city centre bridges: Tyne, Swing and Redheugh.
The proposals would see any driver entering the conurbation with a vehicle that does not meet set emissions standards, which are Euro VI or 6 for diesel and Euro 4 for petrol vehicles, receive a charge upon entry. Either option – a CAZ or LEZ with bridge tolls – would represent an additional cost to operating and delivering in and around Newcastle, and, as such, would have a detrimental impact upon the freight industry.
According to FTA, the business organisation representing the logistics sector, the proposed schemes would significantly increase running costs for local businesses, while failing to provide the most effective long-term solution to improving air quality. While the logistics sector is fully committed to reducing vehicle emissions wherever possible, and acknowledges the role the industry must play in improving the air quality of our cities, it is essential that any air quality scheme is developed with the needs of local businesses in mind. Either proposal would cause operating costs for small businesses to soar, unfairly penalising the hard-working companies and individuals that keep the region’s economy thriving.
When making fleet purchasing plans, businesses must consider both the initial purchase price and the period of time they plan to operate that vehicle – typically five to seven years for HGVs – as well as the residual value of the vehicle when it comes to replacement. Residual values for Euro V/5 trucks and vans are now far lower than initially anticipated due to proposals for CAZs across the UK. Many operators are being forced to upgrade their vehicles sooner than planned, some of which are locked into lease plans which are difficult and expensive to leave before the contract end date. It must also be noted that there is no approved retrofit option for HGVs to bring Euro IV or V vehicles up to the Euro VI standard.
There is a potential double economic impact on van operators registered within the zone. Firstly, the Euro 6 standard for vans was only introduced on 1 September 2016. This gives a potential market of second hand vehicles of just over four years, should the CAZ go live by the end of 2020 as proposed. This is not enough time, in the view of FTA, for such a market to have been established; local businesses will have no choice but to buy new vehicles to avoid the charge, adding thousands of pounds to the bottom line. Secondly, setting the CAZ framework at Euro 6 means the residual asset value of their Euro 5 vans has significantly depreciated and businesses would be unable to recover as much value at resale as they were able to in the past.
Instead of a CAZ or a LEZ, in the view of FTA, the councils would be better placed to concentrate on traffic management strategies and encouraging the uptake of ultra-low emission vehicles, where appropriate and if it fits a company’s business model. If the councils insist on going ahead with one of their proposals, they must take all steps available to mitigate the scheme’s damage to local business. FTA is urging the councils to ensure that the size of the zone be as small and targeted as possible, to reduce the number of businesses and operators affected.
FTA is, however, pleased that the councils have refrained from placing the responsibility for improving air quality solely on the shoulders of businesses, when drivers of all types of vehicles – for both private and commercial use – must play their part; it is refreshing to see private cars also included in the zone.
Efficient logistics is vital to keep Britain trading, directly having an impact on more than seven million people employed in the making, selling and moving of goods. With Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, logistics has never been more important to UK plc. A champion and challenger, FTA speaks to Government with one voice on behalf of the whole sector, with members from the road, rail, sea and air industries, as well as the buyers of freight services such as retailers and manufacturers.
Head of Policy for Scotland & Northern England, FTA
* National Statistics (2016) Emissions of air pollutants in the UK