ULEZ scrappage scheme offering £2,000 to replace older cars to end within weeks

London drivers have just a few weeks to apply for grants to help them replace their old cars with models that comply with the capital’s Ultra Low Emissions Zone.

The ULEZ scrapping scheme, launched in January 2023 and extended by six months, will close next month due to a decline in applications, according to Transport for London.

It is said that £186m has already been paid out to 54,000 motorists living in London’s boroughs who have been left with little or no option but to scrap their older vehicles because they do not meet emissions requirements in order to avoid the £12.50-a-day charge.

Applications for the scheme offering grants worth up to £9,000 for minibuses, £7,000 for vans, £2,000 for cars and £1,000 for motorcycles officially close at midnight on Sunday 7 September, TfL has confirmed.

Successful applicants will hand over their older cars (some of which will be destroyed and others sent to Ukraine to help those suffering during the conflict with Russia) and receive a payment to buy an engine that complies with the rules of the zone.

For petrol cars to qualify for the ULEZ requirement, they must generally have been first registered after 2005. Most diesel cars must have been registered after September 2015 to be exempt.

The scheme was expanded in June 2023 to include all London residents, sole traders, small businesses and charities, shortly before the ULEZ area was extended to cover the entire city in August last year.

Groups that own a vehicle that does not meet minimum emissions standards can request cash (or a combination of cash and a public transport pass) to scrap them.

This leaves Londoners who have not accessed the scrappage scheme just three weeks to apply.

TfL says the scheme has been “highly successful in helping people adapt to the world’s leading clean air zone” but says demand has waned recently.

Any remaining funds available beyond Sept. 7 will be allocated to other projects that make up the Mayor’s Transportation Strategy, he said.

While 54,000 motorists in the capital have been able to access funds through the scheme, Not everyone who has applied has been successful.

More than two-thirds of the 61,000 applications made for vans have been rejected, while nThe first half of the 75,000 applications for cars and motorcycles were also vetoed by London’s Department for Transport.

The scrappage scheme was launched in January 2023 and extended in June of that year in preparation for the ULEZ expansion on 29 August. Total funding for the scheme was £210m and £186m has been used so far.

Any remaining funds available after 7 September will be allocated to other projects that make up the Mayor’s Transport Strategy, says TfL

The council said in a statement it was closing the scheme, which has a budget of £210m, as applications “have fallen dramatically in recent weeks”.

This means that Sadiq Khan is likely to recover more than £20m of the funds pledged to support the expansion of ULEZ.

The mayor believes applications have dried up because it says more than 96 per cent of vehicles on London’s roads on a typical day meet ULEZ standards.

As such, TfL says the scrappage scheme has “been successful in achieving its objectives” by delivering a 53 per cent reduction in non-compliant vehicles following the expansion of the zone in August last year.

Sadiq Khan said in a statement: ‘I’m proud that the scrappage scheme, the largest in the UK, has helped so many Londoners switch to cleaner, greener vehicles.

‘ULEZ compliance has now reached over 96 per cent, delivering cleaner air to millions of Londoners.’

He added: “I remain committed to taking world-leading action to improve London’s air quality and promote sustainable transport.”

The council said in a statement that it was ending the scheme because applications had “fallen dramatically in recent weeks”. It believes this is because 96% of vehicles on the road in London are now ULEZ compliant.

Is it possible to purchase a ULEZ compliant vehicle for the same value as the scrappage scheme amount?

When ULEZ was expanded in August 2023 to cover all London boroughs, AutoTrader found there were almost 5,000 compliant cars for sale for £2,000 or less.

However, they were not necessarily London-based vehicles, meaning potential buyers would have had to travel to get their hands on one.

And he went on to warn that drivers would likely have to pay a “ULEZ premium” of more than £3,000 in some cases to buy the most popular models located in the capital.

The investigation, which focuses on 2015 diesel models to be included in Khan’s ULEZ extension to the outer London boroughs, revealed the premium being paid for models registered just a year later but still largely within the rules.

For example, a used 2016 model Volkswagen Golf costs £3,601 more than a non-compliant 2015 model – a 28 per cent increase from £9,445 to £13,046.

Similarly, a used 2016 Ford Focus costs £2,828 more than a non-compliant 2015 model, an increase of 27 per cent from £10,336 to £7,508.

Other popular sellers showing a large ULEZ premium include a 23 per cent (or £2,220) mark-up between a 2015 and 2016 Nissan Qashqai, a 16 per cent (or £2,594) increase between a 2015 and 2016 Land Rover Evoque, and a 13 per cent (or £1,645) difference between a 2015 and 2016 BMW 3 Series.

Ian Plummer, commercial director at Auto Trader, said: ‘This is compelling evidence of the market distortions caused by the ULEZ extension.

‘While the overall used car market is healthy nationally, drivers are having to pay a fine to comply with the rules in London.

“It doesn’t have to be a case of pocket over planet, it is possible to achieve both, but it is vital that we get the balance right between carrots and sticks or we will lose people along the way.”