Latest Aviation Policy News
Inner Thames Estuary feasibility studies: terms of reference
The Airports Commission has published the terms of reference for the four feasibility studies we are undertaking on an inner Thames Estuary airport proposal. The Commission previously consulted on draft terms of reference and amendments following this consultation are clearly marked in the document.
The commission received 29 responses to its consultation on the proposed terms of reference for the inner Thames Estuary feasibility studies.
This document summarises responses to the consultation and, as an outcome of the consultation, sets out the terms of reference for 4 studies that the commission is undertaking on an inner Thames Estuary airport proposal
SASIG Bulletins for February are now available
The latest SASIG bulletins for February are available here.
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Guidelines on European Commission State aid to airports and airlines
The European Commission adopted today new guidelines on how Member States can support airports and airlines in line with EU state aid rules. The guidelines are aimed at ensuring good connections between regions and the mobility of European citizens, while minimising distortions of competition in the Single Market. They are part of the Commission’s State Aid Modernisation (SAM) strategy, which aims at fostering growth in the Single Market by encouraging more effective aid measures and focusing the Commission’s scrutiny on cases with the biggest impact on competition.
The new guidelines for State aid to airports and airlines aims to promote sound use of public resources for growth-oriented initiatives. At the same time, they aim to limit distortions of competition that would undermine a level playing field in the Single Market, in particular by avoiding overcapacity and the duplication of unprofitable airports.
Key features are:
- State aid for investment in airport infrastructure is allowed if there is a genuine transport need and the public support is necessary to ensure the accessibility of a region. The new guidelines define maximum permissible aid intensities depending on the size of an airport, in order to ensure the right mix between public and private investment. The possibilities to grant aid are therefore higher for smaller airports than for larger ones.
- Operating aid to regional airports (with less than 3 million passengers a year) will be allowed for a transitional period of 10 years under certain conditions, in order to give airports time to adjust their business model. To receive operating aid, airports need to work out a business plan paving the way towards full coverage of operating costs at the end of the transitional period. As under the current market conditions, airports with an annual passenger traffic of below 700 000 may face increased difficulties in achieving full cost coverage during the transitional period, the guidelines include a special regime for those airports, with higher aid intensities and a reassessment of the situation after 5 years.
- Start-up aid to airlines to launch a new air route is permitted provided it remains limited in time. The compatibility conditions for start-up aid to airlines have been streamlined and adapted to recent market developments.
The formal adoption and publication of the new guidelines in the Official Journal in all EU official languages is foreseen for March 2014. The new guidelines are available here, with a policy brief ‘New State aid rules for a competitive aviation industry’, here.
Westminster Energy, Environment & Transport Forum Keynote Seminar: Next steps for UK airport policy following the Davies Commission interim report transcript
Next steps for UK Airport policy following the Airports Commission interim report
This publication reflects proceedings at the Westminster Energy, Environment & Transport Forum Seminar: Next steps for UK airport policy following the Davies Commission interim report held on 30 January 2014.
Please note you will need the following password to open the document: wfp6097
The transcripts from the following speakers are included:
Opening session
- Rt Hon Sir Alan Haselhurst MP, Member, All-Party Parliamentary Aviation Group
- Professor Peter Morrell, Visiting Professor, Department of Air Transport, Cranfield University
- Dr Adam Marshall, Director of Policy and External Affairs, British Chambers of Commerce
- Dr Stephen Hickey, Commissioner, Independent Transport Commission
- Dale Keller, Chief Executive, Board of Airline Representatives in the UK (BAR UK)
- Jean Leston, Transport Policy Manager, WWF-UK
Session 2: Along with representatives from the short-list of long haul options, reviewing the options: technical, financial and political feasibility
- Nigel Milton, Director of Policy & Political Relations, Heathrow Airport
- James Colman, Corporate Affairs and Sustainability Director, Gatwick Airport
- Mark Bostock, Director of Runway Innovations, Heathrow Hub
- Andrew Harrison, Managing Director, Stansted Airport
- Daniel Moylan, Aviation Adviser to the Mayor of London
- John Morris, Public Affairs Director, Birmingham Airport
Session 3: Chair’s and Westminster Energy, Environment & Transport Forum closing remarks
- Professor Peter Morrell, Visiting Professor, Department of Air Transport, Cranfield University
- Michael Ryan, Deputy Editor, Westminster Energy, Environment
SASIG Bulletins for January are now available
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Airports Commission: airport level passenger forecasts 2011 to 2050
The spreadsheets contains annual passenger forecasts from 2011 to 2050, rounded to the nearest million, for 30 modelled UK airports and 4 foreign hubs. These forecasts were produced using a version of the Department for Transport (DfT) aviation model and underpin the assessment of need, described in detail in chapter 4 of the Commission’s Interim report. The technical appendix of the Interim Report provides detail of the methodology, in particular the model updates and Commission’s input assumptions. 4 scenarios are provided:
- carbon traded, capacity unconstrained data
- carbon traded, capacity constrained data
- carbon capped, capacity unconstrained data
- carbon capped, capacity constrained data
UK Civil Aviation Authority’s final statement of policy: New information duties under the Civil Aviation Act 2012
The consultation on the UK Civil Aviation Authority’s (CAA) new information duties under the Civil Aviation Act 2012 closed on 31 August 2013. Following consideration of formal responses to the consultation, as well as views expressed at stakeholder events and meetings held throughout 2013, the CAA has published their final statement of policy. The full policy statement is available here.
Alongside the statement of policy, they have also published a summary of the responses they received to the consultation, which sets out how they plan to implement the information outputs proposed in the consultation.
The CAA has stated that it will continue to ‘engage with stakeholders’ as it progresses work on making this information available. Further details can be found in the summary of stakeholder responses to the CAA’s proposals, available here.
Draft Airports Commission Appraisal Framework (for consultation)
Draft Airports Commission Appraisal Framework (for consultation)
This draft Appraisal Framework sets out in detail how the Airports Commission expects the short-listed scheme designs for additional airport capacity announced in December to be developed, and how the schemes will be appraised. This consultation invites responses on the draft framework which consists of 4 inter-related elements:
- the Commission’s objectives, against which options will be assessed and on which its final recommendations will be based
- a refreshed scheme design for each short-listed option, to be used as the starting point for appraisal
- a business case and sustainability assessment for each option, incorporating the information needed to make informed assessments against the Commission’s objectives
- a set of appraisal modules explaining the methodologies that the Commission proposes to use in assessing options
Each of these is described in more detail in the report, and the Commission welcomes views on its suggested approach in each case (whilst noting that the requirement to develop business cases and sustainability assessments for each option is prescribed by its terms of reference).
The consultation period will run until 28 February 2014. Consultation responses , with a suggested maximum length of 30 pages, should be sent to [email protected]. The consultation questions are listed in Appendix C of the report or shown below:
- Are the objectives stated in the the draft appraisal framework suitable for assessing the short-listed options? If not please explain why not, and suggest any alterations you feel would make them more suitable.
- Are there any other objectives that the Commission should consider, and if so what are they?
- Will the appraisal modules described in the draft appraisal framework be sufficient to analyse the short-listed options against the stated objectives? If not please explain why not, and provide examples or evidence to support your answer.
- Will the appraisal modules described in the draft appraisal framework be sufficient to construct business cases and sustainability assessments to enable the Commission to make recommendations and the Government to act on these? If not please explain why not, and provide examples or evidence to support your answer.
- Are the five components of the updated scheme design set out in the draft appraisal framework suitable for understanding schemes’ potential performance against the stated objectives? If not, please suggest any modifications that you think would make them more suitable.
- Is the level of detail in the components for the updated scheme design set out in the draft appraisal framework appropriate given the likelihood that some schemes may not progress to full stages of development? Please provide examples or evidence to support your answer.
Airports Commission consultation: Feasibility of Inner Thames Estuary airport
Airport Commission – Inner Thames Estuary Feasibility
The Airports Commission have published a consultation on the Commission’s current position on taking forward additional feasibility and impacts work for an inner Thames Estuary airport proposal. It invites comments on the draft terms of reference for the 4 research studies which the Airports Commission will be progressing. The Commission’s current position on the draft terms of reference for the four study areas can be found in the appendix to the report, but are outlined briefly below:
- Environmental impacts – assessment of the impacts on the Natura 2000 sites, coastal system, habitats and species affected and historical and archaeological sites, in constructing and operating a new airport and identifying whether the legal tests could be met.
- Operational feasibility and attitudes about moving to a new airport – assessment of key potential operational issues and potential mitigation, including meteorological and wildlife impacts, the SS Montgomery and relocating energy facilities; assessing airline, airport, business and industry attitudes to the decision to move operations to a new hub airport, and to then moving operations.
- Socio-economic impacts – assessment of the local, sub-national and national economic and social benefits and impacts of building a new hub airport in the inner Thames Estuary, closing down Heathrow and London City airports, and redeveloping the Heathrow site.
- Surface access impacts – assessment of the operational, cost and environmental impacts of any surface transport proposals required to support a new hub airport, as well as impacts on existing and planned local and strategic transport infrastructure.
The Commission is now inviting views and comments on its current position on the proposed terms of reference. Comments are invited by no later than 14 February 2014, to inform the project initiation documents. Please send any comments on the draft terms of reference for the four studies to [email protected].
UK Civil Aviation Authority publishes final decisions on economic regulation at Heathrow, Gatwick and Stansted airports
The UK Civil Aviation Authority (CAA) has published its final decisions on economic regulation at Heathrow, Gatwick and Stansted airports after April 2014.
The decisions announced today have been made using powers set out in the Civil Aviation Act 2012, which requires that regulation reflects the circumstances of individual airports. The CAA has therefore assessed the market power of Heathrow, Gatwick and Stansted airports (passenger market only for Stansted). It has decided passengers would not benefit from further regulation of Stansted, but that Heathrow and Gatwick will both require airport licences from April 2014 onwards.
Heathrow
At Heathrow, the CAA’s price control decision will see prices fall in real terms by 1.5% per year between 2014 and 2019 (RPI-1.5%). This has changed from the CAA’s Final Proposals published in October, which suggested prices rising in line with inflation. The changes have been made as passenger traffic forecasts have strengthened since October, and the cost of capital has been revised.
Gatwick
The CAA has based regulation on the airport operator’s own commitments to its airline customers. These and various airport-airline contracts cover price, service quality, investment and other issues normally covered by a regulatory settlement, and the CAA states that this should enable a more ‘flexible and commercial approach’.
The CAA is backing the commitments with a licence, to allow the CAA to step in if there are reductions in service quality that are against what it believes are the passenger interest. The CAA will monitor the application of the new framework to ensure that prices remain competitive and that service quality is sustained. The licence will also provide for CAA scrutiny of most second runway costs before they can be passed on to airlines and passengers.
The airport licences will ensure that issues like cleanliness, queuing times, seating availability and information provision are addressed appropriately. There will be a requirement for Heathrow and Gatwick airports to put in place plans to ensure they are better prepared for disruption and can manage it effectively when it does occur.
Stansted
The CAA has completed its assessment for Stansted Airport’s passenger market, taking into account the long-term contracts the airport now has in place with its main airline customers, and determined that the airport does not have substantial market power. This means the airport will not be economically regulated by the CAA from April 2014 onwards. The CAA will publish our decision on Stansted’s cargo market power before the end of March 2014.
- An overview of the CAA’s decisions for the airports can be seen here, with links through to the separate documents.
- The decision document for each airport along with several associated documents can be found here.
- A briefing about airport economic regulation, setting out why regulation is necessary and the CAA’s approach is available here.