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Grants and loans

Low Emission Zone Support Fund for businesses

Location notice

Please note that this page contains information and links most relevant for people living in Scotland.

Energy Saving Trust is offering micro businesses and sole traders, with an operating site within 20km of Scotland's low emission zones, a grant towards the safe disposal of non-compliant vehicles.

Low emission zones in Glasgow, Edinburgh, Aberdeen and Dundee are now live. Low emission zones are designed to improve local air quality by discouraging older, more polluting vehicles from entering the zone.

For more information, please visit our dedicated low emission zone webpage.

About the Low Emission Zone Support Fund for businesses and sole traders

The Low Emission Zone Support Fund, funded by Transport Scotland and administered by Energy Saving Trust, offers an incentive for eligible businesses to take their older, more polluting vehicles off the road.

Grants of £2,000 are available to micro businesses with nine or fewer full-time employees and sole traders. Successful applicants will be required to dispose of their vehicle at a Scottish authorised treatment facility. A grant offer must be in place prior to vehicle disposal.

Following vehicle disposal and successful receipt of the fund, eligible businesses will be offered an additional £1,000 towards the purchase of a cargo or electric cargo bike option through Travel Better Fund for businesses.

For more information, please read our Low Emission Zone Support Fund leaflet for businesses.

How to apply

To apply to the Low Emission Zone Support Fund for businesses, please review the eligibility criteria below. For guidance on the fund application and disposal process, see the diagram below.

If you believe you are eligible for this fund and would like to apply, please fill out our self-referral. If your answers indicate you may be eligible, you will receive a link to the full online application form shortly after by email.

If you would like to discuss your future business transport needs with a sustainable transport coordinator, please get in touch using our online form.

You MUST NOT scrap your vehicle until you have received a grant offer letter from Energy Saving Trust confirming your eligibility, otherwise you will not be eligible for funding.

Eligibility criteria

To be eligible for the Low Emission Zone Support Fund, you must meet all of the following criteria (you can also download the eligibility criteria).

1. Your business must have an operating site within 20km of a low emission zone. If you are unsure, a sustainable transport coordinator will be able to confirm this.

2. Your business must own a vehicle that does not meet the minimum emissions standards of low emission zones:

  • Euro 3 or older petrol vehicles – this generally applies to those registered before 2006.
  • Euro 5 or older diesel vehicles – this generally applies to those registered before September 2015.

You can use the Vehicle Checker to see whether your vehicle would be allowed to enter a zone.

3. The vehicle must hold a current MOT, be fully taxed and cannot hold SORN status. If you are unsure, you can check online if your vehicle is taxed and its MOT status.

4. The vehicle must be registered in the name of the business owner or under the business name as stated on the submitted application.

5. You must have owned the vehicle prior to 17 September 2020 and utilise it for business operational purposes.

6. Your business must be an active micro business or a sole trader. To fit this definition, you must:

  • Employ nine or fewer full-time employees.
  • Have a turnover of £632,000 or less, or a balance sheet of up to £316,000 in the preceding and current financial year.

7. The Low Emission Zone Support Fund cannot be used in conjunction with Transport Scotland’s Switched on Taxis Loan or Low Carbon Transport Loan. This is a standalone fund and the applicant must not apply for the aforementioned funding until six months following grant payment from the Low Emission Zone Support Fund. In addition, the applicant must not have received funding from these programmes six months prior to applying.

8. A business may apply to dispose of a maximum of three vehicles under this fund.

9. You must commit to replace the vehicle with a zone compliant model if a replacement vehicle is required for business needs.

This support fund has been made available to help applicants avoid low emission zone penalties by moving away from non-compliant vehicles. We expect applicants to replace the scrapped vehicle with sustainable travel options, choosing to travel better where possible. We expect applicants who plan to purchase another vehicle to replace the scrapped vehicle with one that meets the low emission zone standards, therefore avoiding future penalties and helping to improve local air quality.

If you wish to apply for this funding, you MUST NOT scrap your vehicle until you have received a grant offer letter from Energy Saving Trust confirming funding.

If you would like additional information on the scheme, please email: LEZfund@est.org.uk

Travel Better Fund for businesses

If you successfully claim the Low Emission Zone Support Fund and choose to move towards sustainable travel, we can reimburse your business up to £1,000 towards the purchase of a cargo or electric cargo (ecargo) bike option.

A cargo bike is a cycle that has been specifically designed to carry a load, while ecargo bikes have an electric motor to help support heavier loads and longer distances. There are many different types of cargo bikes available, covering a range of business needs.

Cargo or ecargo bikes offer many benefits compared to traditional motor vehicles, including:

  • Significantly lower upfront and running costs: Ecargo bikes refuel on electricity, which is cheaper than petrol or diesel. Both cargo and ecargo bikes have lower servicing, repair and insurance costs and are exempt from low emission zone penalties and parking charges.
  • Improve the efficiency of your journeys: Ecargo and cargo bikes can use cycle lanes, shortcuts, and more parking options.
  • Zero tailpipe emissions: Using a cargo or ecargo bike can significantly reduce your journey’s carbon footprint and limit your contribution to local noise or air pollution.
  • Benefits for you and your workforce: Encouraging active travel can create a healthier, happier workforce.

For more information, please visit our ecargo bikes webpage or contact your local sustainable transport coordinator via the online contact form.

Eligible travel measures include:

In addition to the above grant value, additional costs can be covered by Energy Saving Trust’s interest-free eBike Business Loan (up to £6,000).

Items which are NOT eligible for the Travel Better Fund for businesses include:

  • non-cargo format cycles
  • cycling accessories such as helmets and lights
  • bike maintenance, repairs or servicing
  • cycle storage
  • insurance costs
  • cycle training
  • cars, mopeds, motor bikes or any other form of motorised transport
  • electric scooters, scooters, skateboards, hoverboards

Fund application and disposal process

Please refer to the below diagram for a detailed visualisation of the application process.

Case study - Harajuku Kitchen

Meet Keith and Kaori, the owners of Harajuku Kitchen, an authentic Japanese restaurant with locations in Edinburgh’s Bruntsfield, Stockbridge market and St James Quarter. 

In preparation for the introduction of Edinburgh’s Low Emission Zone, they took advantage of Energy Saving Trust’s Low Emission Zone Support Fund for businesses to dispose of their older, more polluting van and replace it with a newer model.

Terms and conditions

Important notes:

  • Any vehicle disposed of before the issue of a grant offer letter will not receive funding.
  • You must ensure that the authorised treatment facility understands you wish to destroy the vehicle, and they need to provide you with a Certificate of Destruction (CoD).
  • Once the vehicle is disposed of, and the CoD is provided to Energy Saving Trust, funds will be released within five working days of document acceptance.

Energy Saving Trust is authorised and regulated by the Financial Conduct Authority. This fund is subject to availability and terms and conditions apply.

View information and eligibility on the Low Emission Zone Support Fund for households.

If you do not meet the eligibility criteria for the Low Emission Zone Support Fund for businesses, you may be interested in the following funds and loans:

Last updated: 20 June 2022