The Government wants to allow local councils to charge utility companies up to 2500 a day if they carry out roadworks at peak times.
However, charges would be cut, or avoided altogether, if roadworks were carried out during quieter periods or at night.
It means that rush-hour jams caused by roadworks could be a thing of the past. Transport minister Philip Hammond said: 'Everyone knows how frustrating it can be when youre in a traffic jam because someone is digging up the road.
'That is why I am putting forward proposals that would incentivise utility companies and local authorities to carry out their works at times when they will cause the minimum disruption to the travelling public.'
It is estimated that congestion caused by roadworks costs the economy 4 billion a year.