Councils in England would be allowed to charge utility companies by the hour for roadworks which cause significant disruption, if government proposals are approved.
The plan aims to halve the delays motorists endure due to utility works.
Roadworks cost the economy £4bn a year due to delayed deliveries and people being unable to get to work on time.
The proposals follow successful trials in London and Kent which saw severe congestion fall by more than 50%.
'Lane rental'
The charges aim to encourage utility companies to avoid busy routes and times, and to work together to avoid repeatedly digging up the same piece of road.
The London trial saw firms co-ordinate their roadworks more than 600 times.
Companies could avoid the charges, also known as lane rental schemes, by carrying out works in the evening or at weekends.
Councils currently issue permits for roadworks, but the government believes the new scheme would give them greater control and monitoring powers.
'Increased costs'
Transport Secretary Chris Grayling said: "Delays caused by roadworks can be the bane of drivers' lives - especially when they take place at rush hour on busy routes.
"These proposals would give councils greater powers to ensure utility companies avoid carrying out works at the busiest times and on the most popular routes.
"This would not only improve journeys and cut congestion but also save businesses from the increased costs they incur as a result of traffic on our roads," Mr Grayling said.
The rollout is part of a government plan to give councils more ways to manage roadworks, with the aim to support the delivery of wider national infrastructure projects.
'Consistent and proportionate'
Bob Gallienne, chief executive of the National Joint Utilities Group (NJUG), has criticised the proposals.
In a statement, he said: "Utilities companies are delivering the infrastructure that the UK needs to drive up productivity, create economic growth and deliver on government's priorities such as broadband and new homes.
"Lane rental schemes make it harder for utilities companies to deliver vital infrastructure and value for money for consumers while minimising disruption.
"This consultation is a chance to explore how disruption can be reduced for road users at the same time as minimising the policy burden on utilities companies.
"NJUG is currently working with a range of stakeholders to develop a Future Strategy for Street Works, setting out a blueprint for delivering world class street works."
The president of the AA, Edmund King, said: "Lane rental is a positive step.
"We hope that collaboration and cooperative work plans between service providers will now be standard practice.
"One issue that we hope is resolved with lane rental is making sure that whoever digs up the road returns it back in a good state.
"It wouldn't be acceptable for the road to be patched up quickly and poorly, just to try and keep within their rental period."
The consultation on the proposals will last for eight weeks and the changes would come into effect by 2019.
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