London is the largest city to have adopted a central area congestion charging scheme. It has led to a 20% reduction in four-wheeled traffic within the charging zone during charging hours, cutting an estimated 40-50 million litres of vehicle fuel consumption inside the zone and a total 100,000 tons CO2 emissions annually across London. The charge raises £122 M annually which is then spent on improving transport, including providing more buses, improving road safety and implementing energy efficiency in transport. The zone was further extended in February 2007, doubling its size, with initial estimates showing a 13% reduction in traffic in the new area covered. Monitoring of this extended zone has not yet been completed.

What is it?

Congestion charging was first introduced into central London in February 2003. It is a daily charge of £8 for driving or parking a vehicle on public roads within the congestion zone between 0700 and 1800 on Monday to Fridays, excluding public holidays and weekends.

How does it work?

The original central London congestion charging zone covered 22 square kilometres in the heart of London, with a western boundary from Vauxhall, through Victoria, Marble Arch to the Edgware Road. In February 2007, the zone was extended by about 50% to include parts of west central London and included a free route (the original western boundary) through the centre of the enlarged zone.


  • There are no toll booths. Drivers can pay the charge on the web, by SMS text message, in outlets equipped with PayPoint – an electronic payment system, or by telephone;
  • Fixed cameras at the entrance points of the zone automatically capture the number plates of vehicles within the zone. A penalty of £100 applies to the registered keepers of vehicles recorded within the zone that have not paid the charge; this is reduced to £50 if paid within 14 days;
  • Various vehicle types are exempt, including buses, taxis, private hire vehicles and motorcycles; other types of vehicle can register for a 90% or 100% discount, such as vehicles used by residents of the zone or used by those with a disabled persons badge.


  • Traffic levels inside the charging zone have been cut by 20%, equating to 75,000 vehicles;
  • The scheme has reduced congestion in the zone by around 30% during charging hours; Furthermore, the level of congestion on roads bounding the zone is also down;
  • The main response by car drivers is a switch to public transport - around 40,000 daily movements. There has also been a large increase in pedal cycle trips – an 83% increase across London – which the congestion charge has helped stimulate;
  • The scheme has resulted in net reductions of between 40-70 road traffic casualties per annum;
  • The retail sector in central London is now outperforming the rest of the UK and is returning to a long-standing pattern of year-on-year growth;
  • The charge has had no identifiable effect on commercial property values in the original zone;
  • The combined effect of charging and improved vehicle technology has resulted is that NOx emissions have fallen by 13% and total PM10 emissions have fallen by 15%.

CO2 reduction

  • A 16% reduction in road transport CO2 emissions were estimated within the original charging zone, amounting to 30,000 tonnes annually. Figures are not yet available for the extended zone
  • Approximately half of this is due to 75,000 fewer vehicles daily and half due to the remaining traffic experiencing less congestion, saving an estimated 40-50 million litres of vehicle fuel consumption;
  • The London-wide CO2 reduction is estimated at around 100,000 tonnes, ~1% of London’s total road traffic CO2. Worth around £2.5m at a social cost of CO2 of £25/ton. CO2 reduction estimates are derived from the reduced consumption of petrol and diesel fuel by road vehicles as a result of less travel to the charging zone and improved fuel consumption as a consequence of less delays.

Financial investment

  • The original zone cost £160m to set up, with annual operating costs of £90m. The additional costs for the extension to the zone are £140m implementation costs and £43m annual operating costs.
  • In 2005-06 the original scheme generated surplus revenues of £122m, all of which is required by law to be spent on projects and programmes in support of the Mayor’s transport strategy. Recipients include:

bus network operations £100m
roads and bridges £14m
road safety £4m
walking and cycling £4m
It is forecast that the extension to the scheme will bring in an additional £25m to £40m per annum.

Next steps

  • Scheme is operating well. TfL is investigating adjustments to the charge to reflect CO2 emissions of cars: Higher charge for emission rates above 225g/km; zero charge for emission rates below 120g/km.
  • The current residents discount may also be withdrawn for vehicles with emissions rates about 225g/km – equating to an additional cost of over £6,000 per year for residents who drive every day within the zone
  • There are no proposals to further widen the zone as the area covered is considered to be the maximum size by which it could operate effectively.


  • Numerous adjustments to the operation of the scheme have been made. For example alterations to the definitions of exempt vehicles and the introduction of ‘pay next day’ whereby drivers no longer need to pay the charge in advance or on the day of travel;

TfL Congestion Charging Scheme publications library, including annual impact monitoring reports is available from the Transport for London website