Cabbies stand to save up to £10,000 a year on fuel costs following the decision, which will also drastically reduce CO2 emissions.
Although the city council already employs nine fully electric vehicles in its own fleet, licensing rules dating back to 2006 outlawed the use of them as taxis – as it was thought their engines were too small to ensure reliability.
Yet as petrol prices and excise duties continue to rise, council officials say they have received a number of queries from taxi and private hire companies which want to invest in cheap, carbon-neutral cars for their fleets.
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With a number of technological innovations in eco-travel, electric and hybrid engines are now deemed just as – if not more – reliable than larger, older car engines.
They are now set to appear on the streets of the Capital in taxi form after the city council yesterday voted to allow them to be licensed as hire cars.
Councillor Gavin Barrie, convener of the regulatory committee, said: “Electric vehicles have zero emissions and are therefore environmentally friendly.
“We would like to give drivers the opportunity to use them if they’d like to explore this option.”
Taxi bosses hailed the move as “a step forward” towards creating a more eco-friendly public transport network.
Tony Kenmuir, owner of Central Taxis, said: “Most of our taxis are on the road 24 hours a day split between a couple of different drivers, and so they can be spending between £50-60 per day on fuel.
“On top of that, those same drivers could be sitting idle 40 per cent of the time waiting on fares. It’s a huge financial drain, and it’s a strain on the environment as well.”
He added: “If we had the option of using electric vehicles, it would save thousands and thousands of pounds.”
Stephen Hill, who owns private hire company Capital Cars, said he has been petitioning local authorities to change licensing rules ever since he had a spin in an electric-powered Nissan Leaf.
“We’ve already placed an order for three Nissan Leafs, which are capable of being charged up to 80 per cent in just 20 minutes using the charging units we’ve got in preparation,” he said.
“Those orders have just been sitting there waiting in the system until the council agrees to change its licensing rules, so that we can say ‘OK, deliver them’.
“This is the way the industry is heading, and we would plan on putting these cars to use as soon as possible.”
In London, mayor Boris Johnson is pursuing an aggressive policy that would ensure all new taxis in the city are zero-emission capable by 2018.
To help the city reach that goal, Nissan plans to roll out a green version of the iconic black cab, the NV200, by the start of December.