ULEZ - the new direction for European cities?

Clean transport zones in Europe

As of June 2022, Europe had 320 active Low Emission Zones (LEZs), marking a 40% increase since 2019. This number is projected to rise by another 58%, reaching 507 LEZs by 2025, driven by new national laws in countries like France, Spain, and Poland that mandate or support the adoption of such schemes. For now Germany and Italy lead in the number of low emission zones implemented.

However the effectiveness of these zones is evident now in cities like London, where the largest clean air zone operates. The ULEZ in central London has led to a 46% reduction in nitrogen dioxide (NO₂) levels compared to what they would have been without the scheme. In addition, some London boroughs now meet World Health Organization (WHO) standards for PM2.5 levels, significantly improving air quality in both inner London and outer.

The impact of ULEZ on air quality, public health, and the economy

The introduction of Ultra Low Emission Zones (ULEZ) has proven to be a transformative measure for urban centers aiming to tackle air pollution, protect public health, and transition towards sustainable mobility. By targeting the most polluting vehicles and enforcing strict emissions standards, cities like as mentioned London have demonstrated measurable improvements in air quality, which translate into significant health and economic benefits.

Air quality improvements and public health benefits

Air pollution is a major public health issue, with the World Health Organization (WHO) estimating that exposure to poor air quality causes 7 million premature deaths annually worldwide. In urban areas, transport emissions are a leading contributor to air pollution, particularly nitrogen dioxide (NO₂) and particulate matter (PM2.5). The ULEZ implementation has directly addressed these pollutants.

Economic costs and operational adjustments

While the initial cost of implementing ULEZ and transitioning vehicle fleets to compliance is high, the long-term savings are significant. For businesses, particularly those in logistics and courier industries, the costs include:

Upgrading fleets: electric vans, often used to meet ULEZ standards, cost £30,000–£40,000, compared to approximately £20,000 for diesel cars.
Daily charges for non-compliant vehicles: vehicles that do not meet ULEZ emissions standards face daily charges of £12.50 for cars and vans or £100 for larger vehicles like lorries. For businesses relying on extensive urban deliveries, this can lead to significant operational costs if fleets are not updated.

Opportunities and benefits for the courier industry

In Poland, ULEZ has been in effect since July 1, 2024 in the capital, while Cracow and Wroclaw are planning to introduce these zones. The report “Transforming the Last Mile. Zero Emission in Urban Logistics” by the Foundation for the Promotion of Electric Vehicles (FPPE) highlights several implications of the move for the courier industry.

Reduction in delivery times

ULEZ areas, with fewer polluting vehicles and improved air quality, experience reduced traffic congestion. This has a direct positive impact on delivery times, especially for last-mile logistics, which is typically the most time-sensitive and challenging part of the supply chain.

Zero-emission vehicles: electric vans, increasingly adopted by courier companies, can move more freely within ULEZ areas without the need for paying daily charges. These vehicles also benefit from lower traffic restrictions and can use routes specifically designated for eco-friendly transport, such as bus lanes in some urban areas.
Improved traffic flow: studies from London indicate that areas with ULEZ implementation have seen smoother traffic flow due to fewer vehicles entering the zone. This allows couriers to make deliveries more quickly and efficiently.

Long-term cost savings

Although the initial cost of transitioning to ULEZ-compliant vehicles such as electric or hybrid vans and lorries is significant, the long-term economic benefits outweigh these expenses.

Lower naintenance costs: electric vehicles (EVs) have fewer moving parts than internal combustion engine (ICE) vehicles, resulting in reduced maintenance costs. Brake wear is also lower in EVs due to regenerative braking technology.
Reduced fuel expenses: with fluctuating fuel prices, the predictable and often lower energy costs of charging electric vehicles provide a financial advantage. For example, charging an electric van is up to 70% cheaper per kilometer than fueling a diesel equivalent.
Incentives and grants: governments and local authorities offer various financial incentives to support the transition, such as grants for purchasing electric vehicles or tax exemptions for ULEZ-compliant fleets. In London, the scrappage scheme provides funding for replacing old vehicles, further easing the financial burden.

Meeting customer demands

The rise in consumer awareness about sustainability and environmental impact has made green logistics a critical factor for customer loyalty and brand reputation. Businesses adopting ULEZ-compliant fleets are seen as responsible and forward-thinking.

Sustainability as a selling point: companies that highlight their commitment to reducing emissions, through measures such as investing in electric vans or using carbon-neutral delivery services, appeal to environmentally conscious consumers.
Enhanced customer loyalty: studies show that 71% of consumers prefer brands with a demonstrated commitment to sustainability. Offering ULEZ-compliant deliveries, which actively reduce air pollution, can help couriers strengthen customer relationships.
Corporate partnerships: businesses increasingly prioritize working with logistics providers that align with their sustainability goals. By adopting ULEZ-compliant fleets, courier companies position themselves as ideal partners for environmentally focused corporations.

Contribution to climate goals

Investing in ULEZ-compliant fleets helps courier companies align with broader climate objectives. Governments worldwide are implementing stricter emissions targets, and by complying with ULEZ regulations, businesses contribute to reducing greenhouse gas emissions.

Carbon neutrality: transitioning to electric or hybrid fleets aids courier companies in achieving their carbon-neutral goals, which are becoming a requirement for many multinational partners.
Future-proofing operations: as regulations tighten globally, businesses that adapt early will face fewer disruptions in the future.

Costs and benefits: a closer look

ULEZ compliance delivers indirect financial benefits through improved public health and reduced environmental damage. These improvements contribute to healthcare savings. Reduced rates of respiratory and cardiovascular diseases are expected to save the UK healthcare system approximately £4 billion over the next decade. Environmental benefits include a reduction of approximately 800,000 tonnes of CO₂ emissions in Greater London over four years, equivalent to removing 175,000 cars from the roads annually. Such reductions support broader climate goals, including the UK’s commitment to achieving net-zero emissions by 2050.

However the implementation of Ultra Low Emission Zones (ULEZ) entails both challenges and opportunities for businesses, particularly in the courier and logistics sectors. Businesses that adapt to ULEZ requirements also gain competitive advantages. Courier companies that transition to zero-emission fleets position themselves as leaders in sustainable logistics, appealing to environmentally conscious customers and corporate partners. For example, DHL’s introduction of electric cargo bikes in London’s ULEZ areas has reduced delivery times during peak traffic hours by 25% while eliminating emissions from those routes.

While ULEZ implementation presents challenges, such as significant upfront investments, the long-term economic benefits—ranging from lower operating costs to public health savings—make it a transformative approach for sustainable urban development. The experiences of cities like London demonstrate the potential for ULEZ to drive economic growth, improve public health, and combat climate change.