More than 40 small to large businesses have warned Sadiq Khan about "choking access" to cleaner forms of transport ahead of rule changes next year.
London's Congestion Charge has been in operation for more than 20 years and costs motorists driving inside central London £15 per day.
The cleaner vehicle discount allows battery electric or hydrogen fuel cell vehicles to drive inside the zone for free.
However, from December 25, 2025, the cleaner vehicle will be discounted and all vehicle owners will need to pay to enter the Congestion Charge.
Do you have a story you'd like to share? Get in touch by emailingmotoring@gbnews.uk
Electric vehicle owners will have to pay the Congestion Charge from December 25, 2025
PAThe scheme, which was previously known as the Ultra Low Emission Discount (ULED), costs motorists £10 to register each vehicle and needs to be renewed every year.
In response to Transport for London removing the exemption, experts are warning that it could have a dramatic impact on drivers of electric vans.
In an open letter to the London Mayor, groups like the AA, Ocado, Openreach and the Federation of Small Businesses, say London businesses will face an "astronomical cost" of £5,500 per vehicle, per year.
The open letter, which is being led by campaign group Clean Cities, said removing the grant would undermine companies who were "taking on debt to invest in the air we breathe".
Recent research found that battery electric vans account for less than three per cent of all vans registered in London, despite two-thirds of those living in the capital saying small businesses need more support to switch to electric vans.
Oliver Lord, UK head of Clean Cities, said: "The Mayor has taken ambitious and successful measures to tackle air pollution in London but scrapping this exemption is at odds with his track record and his commitment on climate.
"How is it right that a dirty diesel van pays the same as a cleaner electric vehicle in the most polluted part of the UK? This defies logic and the best international practice.
"Now is the time for the Mayor to cement his efforts for change by maintaining the exemption and working on a broader package of support for green freight in the capital."
Clean Cities has highlighted how local authorities across the Netherlands have introduced Zero Emission Zones for freight starting next year.
As a result of these new changes, electric van sales in the Netherlands were around twice that of the UK in 2023, as well as the ambition to slash emissions around the country.
Edmund King, President of the AA, acknowledged how the air quality in the capital had increased dramatically compared to 10 years ago, although he warned that this could be in danger if the removal of the clean air grant goes ahead.
He said: "Cutting the congestion charge discount for electric vans is a detrimental policy which could backfire on the health of Londoners and the economy of London. We still need to encourage zero emission transport rather than deter it."
LATEST DEVELOPMENTS:
Experts have warned that the decision to remove the grant could impact electric van sales
PAThe Congestion Charge operates between 7am and 6pm Monday to Friday and 12pm to 6pm on Saturdays, Sundays and bank holidays. Charges are not in operation between Christmas Day and New Year's Day bank holiday.
Laura Timm, Federation of Small Businesses, London Policy Chair, said: "Small firms all over London have faced a 'cost of doing business crisis' for the best part of a decade and many have 'done the right thing' and invested in green initiatives within their business.
"For businesses who have purchased electric vans, they should be supported and not be at risk of losing the Congestion Charge exemption on Christmas Day 2025.
"We urge the Mayor of London and TfL to maintain this supportive measure for businesses as it sends the right signal to struggling small businesses."
