Composition and growth of air transport

Air transport is the fastest growing sector of transport, with an annual growth rate of about 5%. In 2000 the number of passengers using UK airports was 181 million (each arrival or departure is counted as one passenger). There were 2.5m tonnes of freight and a total of 2.1m flights (passenger and freight). At present some 70% of freight is carried in the hold of passenger planes.^1,2

The government is currently forecasting an increase of passengers by 2030 to 501m, an increase of 180% or 3.5% pa (per annum). The forecasts for freight tonnage at 2030 is 13.6m tonnes, an increase of 440% or 5.8% pa.² The fastest growing sector of freight is flying fruit, vegetables and flowers into the UK.

The majority of UK flights are scheduled passenger flights with charters representing some 20%. Only about 22% of passengers are business, the rest being mainly tourist/holidays and other personal trips such as study. These proportions are forecast to remain roughly the same in 2030. About 10% of trips are domestic, ie within the UK.^1,2,3

Environmental impacts

Climate change

The most important, but least obvious, impact of aircraft is the contribution to climate change. When burnt, aircraft fuel is converted to carbon dioxide (CO₂) and water (H₂O). The global warming effects of CO₂ are well recognised. However, CO₂ emitted by aircraft on international flights is excluded from national targets. Domestic flights are included in the targets.

Unlike surface transport, emission of water vapour by aircraft is an issue. When injected into the upper atmosphere, water has a considerable warming effect. The impacts are less well understood than CO₂, but a particular effect is the formation of contrails, which have a disproportionate impact. Unlike CO₂, the impacts are regional rather than global.

An additional source of warming is nitrogen dioxide (NO₂). This gas, or its precursor nitric oxide (NO) is emitted in much smaller quantities

than CO₂ and H₂O and depends very much on the design and operating conditions of the engine. (Emissions of CO₂ and H₂O in contrast depend just on the weight of fuel burned.) The global warming impact of NO₂ at high altitudes is not to be confused with its role as a toxic pollutant at ground level.

The total effect of aircraft emissions is known as ‘radiative forcing’. The total radiative forcing by CO₂, H₂O and NO₂ is about 3 times that of CO₂ alone. By 1990 aircraft already contributed about 3.5% to the global warming caused human activity. By 2050 this is forecast to rise to between 4 and 15%.⁴ The very wide margin is due to uncertainties in the rate of growth of air travel and rate of improvement in aircraft engines. It also assumes a ‘business as usual’ scenario elsewhere – if other sectors make major cuts, the proportion due to aircraft would be higher.

Air pollution

Aircraft emit large quantities of pollution on landing and take-off. The most important pollutants are nitrogen oxides, NO_x. (Nitrogen dioxide or NO₂ is in fact the toxic and damaging gas, but nitric oxide, NO, gradually converts to NO₂. For this reason, emission of both gases together, NO_x, is normally quoted.) At Heathrow, aircraft are the major contributors to NO₂ pollution, but around smaller airports other sources, especially road traffic, contribute more. Small particulate matter, PM₁₀ or PM_2.5, is less of a problem from aircraft, the majority around airports coming from the road traffic and fixed sources, such as power plant.

Noise

The impact that most concerns people who live near airports is noise. Noise is generally measured as an average, called ‘Loudness Equivalent’ or Leq. The average is typically taken over an 18-hour period of day and evening and then further averaged over the summer period, which is the busiest. The level of noise is expressed in ‘decibels’, dB.

Leq has a number of shortcomings. Being an average, it does not measure peak noise as aircraft pass over, but it is often the peak that disturbs. Also, due to the ‘logarithmic’ way noise is defined, an increase in the number of flights increases the average noise very little. If the number of flights is doubled, the Leq increases by only 3dB. An increase of 3dB in a ‘noise event’ sounds only slightly louder to the human ear, whereas a doubling of noise events is much more disturbing. The use of Leqs enables the industry and government to claim that noise levels are not increasing when public perception is often the reverse.

At night Leq is of little significance. Here it is the noise of individual aircraft that is most important – whether it is loud enough to wake people up. However, the number of flights is still important – most people can get back to sleep after being woken by one plane, but are kept awake by a succession.

The government insists that only areas exposed to 57dB suffer from significant noise. It draws ‘contour lines’ around the biggest airports, showing the areas and populations exposed to more than 57dB. However, the World Health Organisation and the EU consider that 50dB represents the onset of ‘community annoyance’. That is, above 50dB at least some people are affected.

There are a number of other adverse impacts on people and the environment:

loss of wildlife, habitats and biodiversity due to airports, roads and knock-on development
impacts on watercourses and groundwater
increased risk of flooding due to loss of natural surfaces that soak up rainwater
loss of rural landscape
harm to townscape and visual amenity
loss of heritage, eg ancient churches, old buildings and monuments
safety risk to people on the ground – ‘third party safety’
traffic congestion
rapid spread of disease

Economic impacts

‘Contribution’ to the economyDespite all the promotion and ‘hype’, air transport is quite a minor industry. In terms of its contribution to the measure of economic activity, Gross Domestic Product (GDP), aviation is the 29th most important industry in the UK. At 28th in the league and slightly more important are sewage and sanitary ware!⁵ Air transport ‘contributes’ about 1.4% of GDP. But the word ‘contribution’ can mislead (and indeed, is used to do so). All it means is that 1.4% of GDP is accounted for by air transport – it does not mean that the economy is 1.4% bigger because of it. If people did not spend 1.4% of their money on air transport, they would assuredly spend it on something else. That something else – whatever it was – would equally ‘contribute’ to GDP. Put another way, spending and economic activity can be readily substituted between different sectors of the economy.⁶ Air travel and business efficiency It is claimed that air transport contributes (in a real sense) to the economy because it increases industrial productivity. It is hard to imagine an efficient, modern economy without any air travel. However, there is no evidence of link between the volume of air travel and industrial productivity⁶, any more than, as SACTRA discovered, there is a link between the amount of roads and regional economic performance. (SACTRA - Standing Advisory Committee on Trunk Road Assessment) Air travel is no different in this sense to any other goods or services used by business. Water, electricity and stationery are vital for the efficient functioning of business, but there is no lobbying for increased usage of these. As with electricity, businesses will use what they need and no more.

The industry and government make great play about the fact that air travel can bring investment and jobs into the country. But they never mention the fact that it can equally suck investment and jobs away. They also fail to point out in this context that the great majority of air travel and the great majority of the forecast growth is for tourism, not business (business is 22%). So the large growth being promoted has little to do with business anyway. There is more than enough airport capacity for business travel for the conceivable future.

Tourism

Tourism takes far more money out of the country than it brings in. In 2001 UK residents spent £18.7 billion abroad compared with £7.6bn foreigners brought into the UK.⁷ Yet the industry and government cite tourism as an economic benefit of more air travel.

Cheap domestic flights also encourage the growth in the number of second homes, which price local people out of the housing market. This is happening in Cornwall, partly through the effect of Newquay airport that offers cheap internal flights.

Misinformation on economics

A campaign of misinformation on the economic benefit of air travel was launched by a study called ‘The Economic Benefits of Aviation’ in 1998 by a firm of consultants called Oxford Economic Forecasting (OEF).⁸ It purported to be a government study, one of a number of studies to underpin the government consultation, ‘The Future of Aviation’ , and the current airports consultation.

In fact, 90% of the cost was paid for by the aviation industry and it read like a lobbying document for them. There were fundamental flaws in the study that were pointed out by non-governmental organisations (NGOs) and independent economists.^8,9 These flaws, which could not have been overlooked by any competent economist, were not disputed by OEF or the government.

Jobs

Another key plank of the industry and government strategy is to 'hype up' the issue of employment and use it to justify massive airport expansion.

Air transport employs some 180,000 direct staff and about 200,000 indirectly via the supply chain.⁶However, the number of people employed in industry does not directly affect the total number of jobs in the UK. This is because money spent on air transport is money not available to be spent on something else. If the money were spent on goods and services other than air transport, the supply of those goods and services would equally generate jobs.

As with the economy, the key factor in employment is ‘substitution’. The amount of air transport and its rate of growth therefore have no significant effect on the total number of jobs in the UK. This conclusion is supported by economic consultancies that advise the industry, government and NGOs.^6,8

There are, of course, major impacts on jobs locally. However, the job creation that is claimed is highly suspect. There are no studies that compare the jobs actually generated with those that were claimed in order to obtain planning permission. Also, the jobs that would be created locally at airports, such as Gatwick and Heathrow, threaten the countryside and Green Belt and the local economy. They require more housing, roads and warehouses and will induce migration into areas that have low unemployment and have no need of ‘regeneration’.

External costs and tax breaks

External costs

Air transport imposes large costs on society because of its impacts. Many of these, such as global warming, air pollution and noise, can be expressed in economic terms and are called external or hidden costs. Paying such costs is a part of the ‘Polluter Pays Principle’. The government says it supports the Polluter Pays Principle and has stated specifically that it considers that air transport should pay its external costs.

Calculating external costs is difficult and imprecise. The Green Party has estimated UK aviation’s external costs as £3.8bn, or 26% of the EU total. Another estimate, based on an EU report, is that the external costs are £4.8bn per year. Airport Watch estimates that the costs are between £2bn and £4bn per year and rising.¹¹ Even the industry now accepts that the cost is of the order of £2bn. The biggest component of external cost in these estimates is climate change. Air pollution and noise also figure. But other impacts, such as loss of biodiversity and heritage, are often not included at all. This is presumably because there is no accepted method of putting an economic value on them.

Tax breaks

As well as not paying its external costs, the air transport industry does not pay certain taxes. There is no tax on fuel, no VAT, and duty-free sales continue except for trips entirely within the EU. It is estimated that if aircraft fuel were taxed at the same rate as unleaded petrol, if VAT were levied at the standard rate and if duty-free were abolished, the tax raised would be an astonishing £9.2bn a year (and rising).¹² This is after the current Airport Departure Tax (APD) of £0.9bn has been netted off.

It may be considered unreasonable for the industry to pay both external costs of £2-4bn pa plus tax equalisation of £9.2bn. In the case of cars, the high tax on fuel is intended to include external costs as well as pure revenue collection to pay for public services. The same principle should probably apply to air transport; thus tax at £9.2bn pa could be deemed to pay for the external costs.

There are problems in charging certain taxes, particularly a tax on aircraft fuel. A direct tax on fuel is presently prevented by international agreement, but the UK government is doing nothing to initiate changes to these agreements. The EU has proposed a charge on emissions within the UK, but it is not clear whether this will happen and what will be the effect. In the absence of these, it would be possible for the government to increase APD or to charge a levy on ‘landing slots’. The Green Party has suggested an air traffic congestion charge, an idea that is being pursued by Greens on the Greater London Assembly. However, the government has shown little interest in these options.

Internationally there is considerable interest in the use of ‘emissions trading’. In this system, permits to emit greenhouse gases are purchased by airlines from other companies who are able to reduce their emissions. While there are theoretical advantages to emissions trading over taxes and charges, there are considerable doubts as to whether emissions trading would be effective in reducing emissions. Indeed, the main reason why emissions trading commands support appears to be that it would allow the industry to increase emissions while paying little for the privilege.

Inequality

When everyone else - other industries and citizens - have to pay tax on fuel, VAT and excise duty, exemption for the air transport industry is, in effect, a subsidy by the taxpayer. It means that the amount of air travel is greater than the economic optimum. This tax-free regime favours frequent fliers, ie the better-off, at the expense of the poor.

The sustainability problem

The over-riding problem with air travel are its huge current and projected rates of growth. Technological improvements are expected to improve fuel efficiency by 1-2% pa, but the benefits that this will give will be swallowed up if growth is allowed to continue at up to 5% pa. To move towards sustainability, the growth rate needs to be cut to a maximum of 1% pa. To achieve greater aims, such as bringing UK CO₂ emissions down to a sustainable level, actual reductions in air travel would probably be needed.

For shorter trips, within the UK and around NW Europe, high-speed rail is a viable alternative to air. The emissions per passenger km are 3 to 5 times less than those of air travel^13,14 and the differential in radiative forcing is greater still.

Airport growth

As a result of pressure from the NGOs and the Green Party, the government has re-calculated the effect on demand if taxes at the suggested level of £9.2bn pa were levied. The results show that instead of 500m passengers pa in 2030, the demand would be 315m. This level of demand would mean that no new runways and no new airports would be needed in the SE of England or the whole of the UK.¹²

If air travel were properly taxed, the spectre of a third runway at Heathrow, extra runways at Stansted, Gatwick and Manchester, or a new airport at Cliffe or in Warwickshire would be vanquished and environmental devastation avoided. Crucially, there would be no economic cost to this scaling down of growth, because air travel would then be close to its optimal economic level.

Further information

See web sites

Green Party www.greenparty.org.uk/campaigns [aviation]

Aviation Environment Federation www.aef.org.uk

Airport Watch www.airportwatch.org.uk

Friends of the Earth www.westlondonfoe.org [aviation]

ANNEX - AIRPORTS CONSULTATION

‘The Future of Aviation’

In Dec 2000 the government issued a consultation paper ‘The Future of Aviation’. This was the first major document following the government’s commitment to “prepare a new airports policy and to bring forward new policies on civil aviation.”

The paper covered the general and strategic issues, but not individual airports. The section on economic impacts was brief and biased; it quoted, without qualification, a report paid for largely by the industry.

Airports Consultation

In July 2002, the airports consultation ‘The Future Development of Air Transport in the UK” was issued². A consultation document (CD) was issued for each of the regions. The CDs are based on a massive forecast increase in traffic, from 181m passengers pa at 2000 to 500m at 2030. The CDs are based on a premise of ‘predict and provide’ – there is very little about managing demand.

External costs are considered in these CDs and an estimate of the economic cost of climate change is made. But by sleight of hand, the Department for Transport (DfT) has effectively ignored any effects on demand As with ‘The Future of Aviation’, there was much ‘hyping up’ of economic and employment benefits. The sections on these subjects were biased and misleading; anything that might lead to an alternative conclusion being suppressed.

There is a chapter on each existing airport with a range of options for expansion. Expansion is considered in terms of new runways. Associated developments such as terminals are only mentioned in passing. There are also options for new airports, notably in Warwickshire and Cliffe (north Kent).

For each region, a series of ‘packages’ was devised. Each package consists of a combination of options at each airport. In the SE, for instance, one package is a Heathrow option with one short runway and a Stansted option with two extra full-length runways.

The consultation raised great community concerns and sparked off massive public protest. Local councils and MPs joined in the protests. Two significant objectors where quasi-governmental bodies - the Royal Commission on Environmental Pollution and the Sustainable Development Commission.

A number of NGOs, including Friends of the Earth, the Aviation Environment Federation, Council for the Protection of Rural England, Royal Society for the Protection of Birds and the National Society for Clean Air set up a coalition called Airport Watch. The object of Airport Watch is to resist the environmental devastation that is being threatened and to coordinate and assist local groups in putting their case.

A key concern for Airport Watch is that local groups should not be ‘nimby’. That is, they should not just oppose expansion at their local airport and say ‘put it somewhere else’. The local groups were urged to challenge the ‘need’ for enormous expansion, the concept of ‘predict and provide’, and the continuance of tax breaks. To their great credit, most local groups have done just that.

2nd Round Airports Consultation

During the consultation, a legal challenge was made by a group of local authorities. They argued that Gatwick options for expansion should have been included. As a result, the government had to re-work its packages to include Gatwick. The SE consultation document was re-issued in Feb 2003 and the new consultation period runs until 30 June 2003.

Further runs of the DfT’s computer model had been carried out before the second consultation. These confirmed what the NGOs and the Green Party had been claiming, namely that if the industry were to pay its external costs and full taxes, much of the demand would evaporate and no new runways would be needed. This vital new data has been omitted from the revised CDs.

White Paper

Following ‘The Future of Aviation’ and the airports consultations, a White Paper on a new UK airports policy will be published. This is expected at the end of 2003 or early in 2004.

REFERENCES

1 CAA : UK airports statistics (annual)

2 Airports consultation documents : www.airconsult.gov.uk

3 SE airport studies paper : ‘Where are the passengers’

4 Aviation and the Global Atmosphere.1999

A Special Report of Intergovernmental Panel on Climate Change Working Groups I and III in collaboration with the Scientific Assessment Panel to the Montreal Protocol on Substances that

Deplete the Ozone Layer. J.E.Penner, D.H.Lister, D.J.Griggs, D.J.Dokken, M.McFarland (Eds.) Cambridge University Press, UK.

5 Office of National Statistics : www.statistics.gov.uk

6 Berkeley Hanover Consulting report : ‘The Impacts of Future - Aviation Growth in the UK’, Dec 2000.

7 HACAN note : ‘Air transport and the economy’, 2002

8 Oxford Economic Forecasting report : ‘The Economic Benefits of Aviation’, 1998.

9 www.wlfoet5.demon.co.uk/archive/oxstudy.htm

10 Green Party report : ‘Aviation’s Economic Downside’

11 Airport Watch : www.airportwatch.org.uk [ briefings]

12 Aviation Environment Federation report : ‘The Hidden Cost of Flying’, Feb 2003

13 Centre for Energy Conservation and Energy Conservation, Delft : ‘A European Aviation Charge : Feasibility Study’, 1998.

14 Commission for Integrated Transport : ‘A comparative study of the environmental effects of rail and short-haul air travel’, Sep 2001.