Electric van operators including the AA, Ocado and Openreach have called on the Mayor of London to rethink his decision on scrapping the Congestion Charge exemption.

Drivers of electric vans currently receive a 100% discount on the capital’s Congestion Charge

More than 40 businesses, large and small, have said they are “deeply troubled” by Sadiq Khan’s decision to make electric van drivers pay the £15 a day charge from Christmas 2025.

Drivers of electric vans currently receive a 100% discount on the capital’s Congestion Charge, but their special status is set to end by 25 December 2025.

Signatories of an open letter to Sadiq Khan are urging for a rethink as they warn that the move will inflict an “astronomical cost” on London’s firms.

Led by campaign group Clean Cities, supporters of the exemption argue it has played a “fundamental role” in easing the cost of investing in environmentally friendly fleets. Abolishing it would undermine firms who have “taken on debt to invest in the air we breathe”.

The latest data shows that battery electric vans still account for fewer than 3% of all vans registered in London while 67% of Londoners believe small businesses still need more support to help them switch to electric vehicles. Out of the estimated five million SMEs operating in the UK, one million are based in London.

Today’s letter coincides with a new report published by Clean Cities, which shows 20 Dutch cities – including Amsterdam, Rotterdam, and Utrecht – are leapfrogging London by implementing zero-emission zones for freight from next year through private and public partnerships. In consequence, electric van sales in the Netherlands were around twice that of the UK in 2023.

Clean Cities launched Clean Cargo Capital in August, a campaign focused on accelerating the uptake of electric or pedal-powered commercial vehicles in London.

Oliver Lord, UK head of clean cities, said: “The Mayor has taken ambitious and successful measures to tackle air pollution in London but scrapping this exemption is at odds with his track record and his commitment on climate.

“Ultimately, small businesses are those set to suffer the most, with the progress towards a cleaner, electric future choked off in an economic situation already fraught with challenges.

“How is it right that a dirty diesel van pays the same as a cleaner electric vehicle in the most polluted part of the UK? This defies logic and the best international practice. Now is the time for the Mayor to cement his efforts for change by maintaining the exemption and working on a broader package of support for green freight in the capital.”

Edmund King, president of the AA, said: “Much has been done in London over the last few years to improve air quality and this should be applauded. Ten years ago, it was common to blow your nose and fine black particulates on your handkerchief. This has thankfully changed.

“However, cutting the congestion charge discount for electric vans is a detrimental policy which could backfire on the health of Londoners and the economy of London. We still need to encourage zero-emission transport rather than deter it.”

The Federation of Small Businesses also warned the Mayor not to bring charges on firms that have “done the right thing” and invested in green initiatives within their business.

Laura Timm, London policy chair at the FSB, said: “For businesses who have purchased electric vans they should be supported and not be at risk of losing the Congestion Charge exemption on Christmas Day 2025.

“We urge the Mayor of London and TfL to maintain this supportive measure for businesses as it sends the right signal to struggling small businesses.”