London and other European cities which are defying European law by illegally polluting the air will have to dramatically reduce their vehicle emissions by 2020, the European commission has said.

In a signal that Europe is running out of patience with countries that consistently fail to meet air pllution targets, environment commissioner Janez Potočnik served notice that the EC would start fining countries from 2020.

"Poor air quality is the number one environmental cause of premature death in the EU with a toll that outstrips road traffic accidents. It is an 'invisible killer' and it prevents many people from living a fully active life," he said.

Potočnik said air pollution already costs Europe €330-940bn (£277-789bn) a year in extra health costs and prematurely killed over 100,000 people a year.

Large cities like London have claimed to be unable to meet NO2 targets set in 1999 until 2025 at the earliest. They have argued for extensions but the new initiative is expected to force them to take traffic off the road using charges, and stricter low emission zones.

Potočnik proposed a package of measures aimed to avoid 58,000 premature deaths a year by 2030. The benefits, he claimed, would be about €40bn a year, or more than 12 times the costs of pollution abatement needed, estimated to reach €3.4bn a year in 2030.

The proposals, which will have to be studied by countries, included setting stricter emission ceilings by 2030 for six major pollutants, including particulate matter (PM) or the fine dust emitted by vehicles and shipping, sulphur dioxide which contributes to acid rain and soil acidification, and nitrogen oxides emitted by road vehicles.

He also plans to reduce pollution from large buildings, tighten up existing targets and fund cities to reduce pollution.

But environment groups said they were disappointed that Europe was not insisting on earlier targets. "We're encouraged that they recognise the scale of the problem, but disappointed they've bowed to pressure from industry and countries like the UK to put off taking action until 2030," said Alan Andrews, a lawyer with ClientEarth.

"The government, London mayor and local councils must take bold action to tackle air pollution – building new roads and expanding airports will simply add to the problem. The UK has been allowed to drag its heels on delivering clean air for far too long," said Jenny Bates, air pollution campaigner with Friends of the Erath.