London road, with assorted vehicles. Photograph by Charles Postiaux

Health effects of air pollution

What can councils and the Government do to reduce pollution from freight?

We’re calling on the Government to implement our policy recommendations to reduce air pollution from freight.

Natasha Feiner

Policy and Influencing Manager

Patrick Lee

Communications Manager

Britian is facing an air quality crisis, and it’s made worse by freight: the movement of goods on Britain’s roads.

Our outdated freight system is built on illogical and disorganised delivery networks and relies heavily on polluting vehicles. Freight is a problem that is bad for health and our already stretched NHS. It’s also bad for business, the economy and the climate.

We’ve been working with our partners to test ways to transform and modernise the country’s freight system. The benefits would be enormous: improved health as a result of significant reductions in air pollution and greenhouse gases. But this vision is only possible if businesses and consumers are encouraged and supported to make some big changes.

That’s why we want the Government and local authorities to become advocates for sustainable freight practices. We’re calling on them to implement our recommendations, which set out new policies to reduce air pollution from freight and improve health in our cities.

Our policy recommendations

Create large-scale smart delivery networks
- Develop a national, open network of ‘pick up and drop off (PUDO) points’ so 90% of people in urban areas live within 250 metres of a PUDO point.
- Create a Last Mile Taskforce to facilitate a joined-up approach across Government departments.
Make it easier for businesses of all sizes to adopt sustainable freight practices
- Introduce economic incentives for businesses using cargo bikes.
- Bring in road pricing incentives for low-polluting vehicles.
Reward businesses that reduce freight-related pollution

Why these policy recommendations?

We’ve spent the last few years working with partners to test ways to reduce air pollution from freight. These policy recommendations are the result of that work. Let’s look at them in more detail.

Develop a national, open-network PUDO strategy

Last mile home deliveries – the journeys between your local depot and front door – increase congestion and pollute the air where people live. Giving more people the option to walk or cycle to send or collect a parcel (known as an “active last mile”) can help to reduce air pollution from delivery vans in residential areas. But not enough people live close to a PUDO point and lockers are often limited to a specific delivery company.

We want the Government and local authorities to work with delivery companies to create a national, open network (not limited to any one company) of PUDO points, located where people live and shop. To make this happen, delivery companies would have to agree to share parcel locker space.

This delivery infrastructure works successfully in Europe. Poland has the most extensive network of parcel lockers, at over 74,000 collection points. And it’s already working in parts of the UK too.

To make this vision a reality, the Ministry of Housing, Communities and Local Government would have to develop and issue detailed guidance to local authorities on how to establish an open PUDO network. This would require central government commitment and collaboration from businesses.

The convenience of an open network would nudge more consumers towards an active last mile, reducing congestion and pollution. And locating shared parcel lockers in empty stores would drive footfall and revenue on local high streets.

Create a Last Mile Taskforce to facilitate a joined-up approach across Government departments

An efficient, sustainable freight system will only happen if there is joined-up thinking at national government level. Yet responsibility for the related issues of air quality and freight sits in different government departments.

We propose a central government Last Mile Taskforce, bringing together relevant departments, government agencies, businesses and people whose health is most affected by air pollution. The taskforce would sit within the Department for Transport’s (DfT) existing Freight Council. It would co-create and promote sustainable freight alternatives, for example the adoption of electric and low-emission vehicles.

Introduce economic incentives for businesses that use cargo bikes

Research shows the social and environmental cost of diesel vans is eight times that of e-cargo bikes, amounting to billions of pounds in health and infrastructure expenses each year.

Many businesses already use cargo bikes to deliver via London’s busiest streets. But cost can be a barrier to smaller businesses making the shift to using sustainable delivery modes.

We want the Government to offer interest-free or fixed low-interest loans to small to medium sized businesses (SMEs) who can’t afford to invest in cargo bikes. This initiative would reduce financial barriers and build on the success of the eCargo Bike Grant Fund. Upfront costs for the Government would be outweighed by the long-term benefits for public health and savings on the social and environmental costs of diesel vans.

We propose that the Department of Business and Trade (DBT) and the Treasury would manage this scheme. And that the Government-backed British Business Bank, which helps small businesses to transition to net zero, would deliver it.

As delivery sector jobs can be precarious, and riders encounter risks on busy city roads, loans should be contingent on businesses having safe working practices and offering good, fair work. Read more about what we are asking businesses to do to make this happen.

This initiative would help to reduce road congestion, improving air quality and health in cities. It would also help the Government to meet its own air pollution and net zero targets.

Bring in road pricing incentives for low-polluting vehicles

We recommend the DfT introduce a tiered payment system for commercial road use in cities to incentivise the use of environmentally friendly vehicles, like cargo bikes. Fees would be based on vehicle pollution levels and should consider health-damaging particulate matter, not just carbon or nitrogen oxide.

Lower charges for lower emissions would offer a straightforward, transparent reward to businesses choosing low-pollution vehicles over diesel vans. Schemes like this have been successful elsewhere. For example, after Singapore introduced an Electronic Road Pricing system, congestion was 31% lower than before charges were implemented.

The scheme would reward sustainable business practices. It could also offer opportunities to highlight the longer-term financial benefits of low polluting vehicles, such as reduced fuel and maintenance costs.

Reward businesses that reduce freight-related air pollution

We want local authorities and the Treasury to implement a tiered business rates system that rewards businesses taking positive steps to reduce particulate emissions. To make it easy for businesses of all sizes, especially SMEs, to report their emissions, the Government should also develop an easy-to-use emissions calculator. Examples of tools like this, including one developed by our partner Cross River Partnership, are available.

This system would reward those committed to running sustainable businesses and offer an incentive to SMEs, who typically lack time and resources, to reduce their impact on air pollution.

A similar approach has worked before. In 2021, the Government introduced 100% business rates relief for low-carbon heat networks which significantly boosted the adoption of heat networks and reduced emissions.

For this to work, the Government would need to make the scheme easy to access and use, introducing a clear, standardised reporting framework, a calculator and guidance. It would also need to market the scheme effectively to SMEs. But the policy would encourage many more businesses towards sustainable practices, reducing pollution and improving health.

The transport sector needs to be rapidly decarbonised. Not just so the Government can meet its net zero targets but to prevent devastating cases of ill-health, to protect the NHS, and to ensure everyone in society has access to clean air.

More on freight and air pollution

Health effects of air pollution

Heavy goods vehicles, aerial photograph by Ivan Bandura

Freight and air pollution. What’s the problem?

Freight is the backbone of the economy. But an outdated system is congesting cities and harming people’s health in urban areas.

Health effects of air pollution

Bike courier cycles beneath a graffitied bridge, photograph by Evgeniya Iakovleva

Our work to reduce air pollution from freight

We’ve been working with partners throughout Lambeth and Southwark to test ways to reduce air pollution from freight in cities.

Health effects of air pollution

Roadway in City of London, with buses, vans, and a cyclist. Photograph by Ruoyu Li.

What can businesses do to reduce air pollution from freight?

The transition to a greener freight system will rely on joined-up thinking and fresh policies from the Government. But businesses can take positive steps now to reduce air pollution and its harmful effects on people’s health.