Cities make business case for £1.5bn air quality fund

02/09/2019
Dominic Browne

Leaders of cities with illegal levels of air pollution are calling for the Government to boost spending on air quality, arguing that a fund of £1.5bn could generate up to £6.5bn in returns.

A report by UK100 - an umbrella body for the group, which includes local leaders in London, Birmingham, Manchester and Liverpool - makes the case for extra investment and argues that the tougher the air quality measure the better the return.

Clean air zones (CAZ) which charge private cars, Class D, were found to have the best benefit cost ratio of all options.

”Local
Bristol: A strong case for charging cars

'As private cars often account for a large proportion of NO2 in the air (e.g. 40% in Bristol), their inclusion in the CAZ restrictions often strengthens the strategic (and economic) case for a CAZ supported by an enhanced Clean Air Fund (CAF),' the report states.

While the Government has already provided £220m of spending over the period 2018/19-2020/21 under a CAF to support CAZs and other plans, local mayors called for the extra government investment in order to secure local support and added value from the agenda.

The extra cash would be spent on CAZs, scrappage or retrofit schemes, more public transport and the provision of more EV charging points.

'A national network of up to 30 Clean Air Zones across England, including London, could be enhanced and unlocked if an additional £1.5bn is committed from Government and business to tackle air pollution in the most polluted towns and cities.'

The cash would be split between £1bn from Government in the upcoming Spending Round, alongside £500m from business contributions.

Crucially, the mayors want to provide lower income residents and small businesses incentives of between £2,000 and £6,000 to either upgrade existing vehicles or get rid of their older, polluting vehicles and switch to a cleaner form of transport such as electric vehicles or public transport.

This would help make the case for Class D clean air zones, which present political difficulties for leaders in cities such as Bristol, where mayor Marvin Rees is currently weighing up options after being hauled over the coals by the Government for dragging his feet.

The Government has called on 60 local authorities to create clean air plans and required five cities, including Bristol, to develop Clean Air Zones (CAZs) to deal with NO2 pollution issues.

'UK100 is seeking Government support for an enhanced CAF, including for London which has historically been excluded from the CAF, which would enable the delivery of CAZs across the UK and support a national fleet renewal programme to deliver WHO air quality standards,' the report states.

Sadiq Khan, mayor of London, said:  'Cities including London cannot deliver further Clean Air Zones without urgent government funding. This funding must include a new national vehicle renewal scheme, which would help businesses and residents prepare for London’s ULEZ expansion in 2021.

'Everyone deserves the right to breathe clean air and the Chancellor simply cannot afford to delay immediate action on this invisible killer.'

Business case

'Using the assumptions as set out on the previous slides, we find that in our baseline case:

– Our Class A-C CAZs achieve benefit-cost ratios (BCRs) of up to 0.8

– Our Class D CAZ achieves a BCR of 1.7, with a wide range of 0.5 - 4.3.'

'With the £50m cost in our notional CAZ base case, £1.0bn (plus private contributions) could cover approximately 20 comparable CAZs. In reality more CAZs can likely be supported, as many are smaller.'

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