AirportsZone: Europe

Eurocontrol asks if joint pan-European system of route charges is still fit for purpose

By October 21, 2021 No Comments

In its latest “Think Paper” Eurocontrol assesses whether the European Route Charges System, which has effectively funded en-route air navigation services (ANS) across the pan-European network for 50 years, is still fit for the future in the wake of a pandemic that has put enormous pressure on the way these services are financed.

Eurocontrol concludes that pre-pandemic, the Route Charges System had “flexibly adapted and evolved over the years, with Eurocontrol’s Central Route Charges Office billing and collecting route charges from airspace users with an enviable 99.7% recovery rate. Those monies collected in turn covered the cost of providing en-route ANS, amounting to around 96% of the revenues required for this by air navigation service providers”.

However, the paper notes that COVID-19 has caused a massive revenue shortfall. “The significantly reduced traffic has failed to match the fixed costs of ANS provision, causing a funding gap that should reach €8.6 billion by year-end, a huge revenue shortfall that will mostly be shouldered by airlines in the form of higher route charges in the years ahead”.

Eurocontrol therefore concludes that while the Route Charges System has “shown its capacity to evolve and adapt, it faces a series of challenges from the way pan-European ANS is funded, to capacity, delays and sustainability considerations as traffic returns – and in this regard, we note that Single European Sky options such as a single unit rate and/or modulation of charges should be considered. None of these challenges is insurmountable, but the main test will be to strive to maintain a common policy that can evolve and accommodate them in the years ahead”.