The Toyota Prius will qualify for free parking under the scheme

The move by Westminster City Council applies to those with hybrid cars, vehicles powered by liquefied petroleum gas (LPG) and hydrogen fuel cells.

The scheme comes into force next month, saving drivers up to �110 a year.

In January, Richmond Council approved a scheme to charge increased parking prices for the most polluting vehicles, with the greenest being exempt.

Westminster councillor Danny Chalkley said he hoped the scheme would result in more people using eco-friendly cars to travel around the city.

Positive measures

He said: "Our location in central London unfortunately means we have very poor air quality.

"We are putting forward positive measures to encourage people to use greener forms of transport.

"We believe these new measures will help reduce carbon emissions and make a real difference."

Previously owners of environmentally friendly cars paid �78 a year for residents' parking permits in Westminster.