Do low emission zones generate car fleet renewal? A quasi-natural experiment

Abstract

This study evaluates whether the introduction of Low Emission Zones accelerates car fleet renewal. To achieve this aim, this study uses the 2017 introduction of the Ultra Low Emission Zone in London, United Kingdom. This policy required drivers of older cars (EURO 4 or older) to pay a £10 charge per day to enter a specific area of central London. A spatial difference-in-differences empirical design is implemented to estimate the causal impact of the policy. The finding of the analysis is that the introduction of this policy increased vehicle fleet renewal by 2.2%. A practical use of this finding is that such ancillary benefits can now be included in the business case development for these policies, quantifying the broader spectrum of positive outcomes that can be realised.