SSE NEWS ARCHIVE - March to May 2004

Our skies in 20 years' time could be a lot quieter, if research by engineers on "silent aircraft" really takes off. Cambridge-MIT Institute (CMI) engineers have been working on new styles of planes that would be barely audible.

No increase in noise around airports is a key requirement for expansion plans, particuarly at Heathrow and Stansted.

Prof Ann Dowling, CMI's Silent Aircraft Initiative (SAI) leader, said it was vital to take a fresh look at aircraft design to achieve quiet skies.

"Our hope is to ensure noise is central in future designs, and to show in conceptual design what can be achieved if you give it really high priority," she told BBC News Online.

The research includes collaboration with key industry partners, like Rolls-Royce, to use some of its design codes to fundamentally alter a number of the elements of engine technology that contribute most to noise.

Noise at take-off is generated when engine exhaust air mixes with surrounding, calmer air. High-speed fans and compressors sucking air into the engines to produce thrust also make for unpleasant high-pitched whining.

And during cruising and at landing, noise is created by airflow over the body and other parts of the craft.

The ultimate aim of SAI is to make an aircraft with noise that is "barely perceptible", or equal to normal background urban noise, Prof Dowling says.

Anti-noise campaigners have welcomed the steps SAI has made since it started in late 2003.

Starting again

John Stewart, head of Hacan ClearSkies, a lobby group fighting expansion at Heathrow, thinks SAI is the most technological initiative he has seen in decades.

"It is a genuinely interesting initiative and, in that sense, a little bit different from some of the vaguer promises we get from the aviation industry and the government about how technology will solve everything over the next 20 to 30 years," he told BBC News Online. "The current technology just will not do that."

The UK government has estimated that there will be a 4% rise in air passenger traffic every year for the next 30 years. That makes for very busy skies, and technological innovation developed now is crucial to coping with that demand. But making noiseless planes is hard.

SAI starts with the proposition of what an aircraft would look like if low-noise was a key design requirement.

"You can't just do it by incremental changes to current designs," says Prof Dowling. "So we have started again and said what will it look like? It needs much more integration of the air frame and the engine."

Under the UK government's 30-year aviation strategy, both Heathrow and Stansted would get new runways.

At Stansted, it is estimated that 14,000 people would be affected by noisier skies.

A recent report by the Civil Aviation Authority suggested that a third runway at Heathrow could mean that, by 2015, over 800,000 people would experience noise levels above those recommended by the World Health Organization.

The Heathrow runway will not get the green light unless there is no rise in noise.

Blended approach

One of the biggest challenges is reducing the noise of aircraft on take-off, as well as reducing emissions at cruising level. For that, the aircraft geometry has to be reconfigured.

One of the most popular concepts for future aircraft has been the "blended-wing body" design, originally devised by aerospace firm McDonnell Douglas. Prof Dowling believes a blended-wing concept is a strong contender for future craft.

"What looked like a better starting point for us was the flying wing, where you have a triangular shape of aircraft," she explains.

"If you put engines on top of the craft rather than underneath, the air frame shields some of the sound."

It is a starting point, and within the three years SAI has to run, the final result will be different. But already, SAI's designs mean there will be a requirement for radically different aircraft.

US manufacturer Boeing has been considering blended-wing bodies that can also be altered to balance good fuel efficiency with lower noise levels.

"It takes a long time to develop a new aircraft in aerospace, so we can't expect instant fixes," says Prof Dowling, who predicts we will not see really innovative, silent aircraft over our heads for another 15 to 20 years. "But if you don't start, you don't get there," she says.

One short-term option which is being examined by the Massachusetts Institute of Technology (MIT) in the US is to change the way aircraft approach a runway.

This means existing craft would fly differently on descent, at a fixed throttle setting. Tests on a method of approach developed by MIT have reduced noise by five decibels.

Silence is golden

The development of silent planes could have profound economic impacts, which SAI is also looking at in detail, especially for the viability of an airport's location. If there are quieter planes, people may no longer object to having an airport in their region or neighbourhood, argues Prof Dowling.

Mr Stewart agrees, although he admits it is an ambitious goal and would like to see the planes working in the flesh - or metal - before being convinced. His concern is that silent aircraft design will give airlines an excuse to bring in many more planes. If the new technology produces planes as quiet as the engineers are now proposing, more planes may not be a problem in noise terms. While it is a vision groups like Hacan might well welcome, in the short and medium term, the problem of air noise remains, explains Mr Stewart.

SAI is a £4m academic and industry-supported project at CMI, building on previous research which developed computer models for noise reduction.

OUR COMMENT: Quiet aircraft would be welcome whether aviation expansion goes ahead or not. This article makes no mention of the equally important need to design an aircraft engine that reduces emissions, both CO2 and oxides of nitrogen. Noise is annoying and constant air noise probably has implications for some health complaints. An excess of aircraft emissions will aggravate climate change, cause local air pollution with adverse effects on residents' health and breach the European Directive on Air Quality. Will such a new design also help reduce fuel use? We need more joined-up research before any of the predicted expansion is allowed.

Pat Dale

A month ago, Tony Blair made a big speech about global warming. The prime minister's message could not have been clearer. The Kyoto treaty, for all the haggling, fell far short of what was needed to crack the problem, and time was running out. "The issue of climate change is now very, very critical indeed," he said.

Clearly Blair has been listening to Sir David King, the government's chief scientist, who says that within a century the last humans will be sharing Antarctica with the penguins. Others, however, appear deaf to the warnings.

The Department of Transport has been lobbying furiously to stop the Office for National Statistics publishing data showing an 85% increase in pollutants from the airline industry and a 59% rise from freight transport since 1990. Joined up government or what?

It's easy to see why the mandarins would find the ONS report a tad embarrassing. This, after all, is the department that has sanctioned a fifth terminal at Heathrow and a third London airport to cope with the seemingly insatiable demand for air travel. It would not - as they say in Whitehall - be "helpful" to have this information in the public domain.

Actually, it's helpful to find out which bits of Whitehall are subject to capture by pressure group, and it's helpful to understand the conceptual problem to be overcome if action is to follow rhetoric. In essence, this boils down to whether modern industrial capitalism is compatible with a healthy planet. Does it make sense, for example, for the G8 to pressurise Opec into pumping more crude in order to bring down the cost of a scarce resource? Is it right that airlines pay no tax on aviation fuel, thus aiding their attempts to boost demand by keeping prices low?

Make no mistake, the forces of conservatism arguing for business as usual are powerful. The good news is that they are opposed by an even stronger lobby - the insurance sector - that sees climate change as a real and immediate threat. These guys have seen weather-related claims rise over the past decade; they believe the planet is warming up and they fear the risk of ruinous losses in the not-too-distant future. The latest evidence shows an accelerated rise in CO2 emissions over the past three years, seen by scientists as a sign that the carbon sinks that soak up a proportion of the gas have started to shut down.

Insurance companies, quite rightly, feel that Kyoto is not the solution - even if the Russians now ratify the treaty, as they almost certainly will. They are among the critics who say that the 1997 deal is timid and based on questionable science, and fails to bind every country in the world into solving a global problem. Kyoto is plan A, but the need - as the prime minister correctly argues - is to use it as a springboard to plan B.

The good news is that plan B already exists, and stands to be the long-term solution that Blair is looking for, provided he has the political courage to back it fully. Contraction and Convergence (C&C) provides a three-stage blueprint for coping with climate change. Initially, there would be an international agreement on how much further the level of CO2 in the atmosphere could be allowed to rise before the changes in climate became unacceptable. Once that had been worked out, estimates of how much of the gas was retained in the atmosphere would be used to work out how quickly global emissions needed to be cut in order to meet the target. This is the contraction part of the process.

Finally, once a target was established for cuts in greenhouse gases - one figure is 60% - it would be possible to allocate the fossil fuel consumption that those emissions represented. Although people in rich countries pollute far more per head than people in poor countries, supporters of C&C say that everybody should have a basic human right to emit the same amount of greenhouse gases, and that a date - say, 2050 - should be fixed for arriving at this point. This is the convergence part of the equation. Rich states would be given time to adjust, and in the meantime could buy the right to pollute from poor countries, providing resources for development.

C&C is an idea whose time has come. The Americans have backed the idea, and if Blair has built up political capital in Washington as a result of Iraq, he should think about cashing it in next year when Britain holds the G8 presidency.

Britain's recent experience, the prime minister should point out, shows that countries can cut emissions and enjoy growth. An even better example is China, the fastest growing economy in the world. China is not just switching from coal to gas, but has been investing heavily in alternative energy sources while the UK has been in thrall to the transport lobby: a lesson Blair would do well to heed.

Quite why the Department for Transport should seek to shoot the messenger, "Officials try to hide rise in transport pollution", Guardian front page 27 May and "Anger at 'gag' on pollution report", Guardian 28 May, by censoring the ONS figures about the rise in air transport CO2 emissions seems strange - particularly so when the same ministry has itself published work robustly forecasting the same CO2 emissions at 33.4 million tonnes in the year 2000 in its consultation exercise and White Paper background papers over the last few months.

The figure officials seem to be seeking to downplay, 37.3mt CO2 from aircraft exhausts during 2003, is remarkably in line with the Department's own forecasts! An increase of 3.9mt CO2 over 3 years is probably entirely down to the growth in low cost airlines. It is, unfortunately, also broadly in line with the worrying trend of rising, uncontrolled greenhouse gas emissions from UK air travel.

Rather than burying bad news - a departmental news management trait I thought had disappeared when Jo Moore cycled off to take up teaching - the Department for Transport could perhaps tell us why it thinks massive increases in climate change-inducing aircraft emissions are such a good thing. Again, its own estimate of a grand total of more than 70 million tonnes of CO2 being pumped into the atmosphere in 2030 by the 476 million passengers using the expanded UK airports its recent controversial "predict and provide" White Paper seeks to facilitate, shows the enormity of the problem.

This is not good news for the planet or the Government's climate change policies. Our cinema-going policymakers and politicans should realise that the title of this summer's must-see global warming blockbuster "The Day after Tomorrow" is meant as a salutary warning not an exhortation!

Official figures showing sharp increases in gases responsible for climate change from air and freight transport were removed from the Office of National Statistics (ONS) report on the environment last week after pressure from the Department for Transport.

In a week when Tony Blair was insisting the issue of climate change was "very, very critical" and Margaret Beckett, the environment secretary, claimed the UK was a world leader in reducing emissions, official statistics would have shown an 85% increase in pollutants from the airline industry and 59% for freight transport since 1990.

Instead the announcement was withdrawn and another substituted which did not mention transport emissions at all.

ONS officials were said to be have been "livid" at the transport's department's intervention. A footnote on ONS releases says "National Statistics are produced… free from any political interference".

The original unpublished release has been passed to the Guardian. Headlined "Rise in greenhouse gas emissions from transport", it says that while overall emissions dropped by 10% between 1990 and 2002 the increase from the transport sector as a whole was 50%.

The largest increase of 85% was from air transport, and even this figure would have risen to over 100% but for the slump in air travel as a result of the attacks on the World Trade Centre, the report said. The road freight industry has also increased by 59% according to the statistics.

Both sets of figures reveal the government's most vulnerable areas on climate change policy. It is being heavily criticised by environment groups for its proposed buildings of new runways, expansion of regional airports and failure to shift sufficient freight onto the railways.

The draft of the report containing the transport emission figures were sent for comment to DEFRA and the DfT. Senior officials at the environment department described the rapidly rising emissions as "somewhat sensitive" and prepared a briefing paper for ministers to field expected hostile questions by journalists. Officials at the DfT actively attempted to stop publication of the release.

Perry Francis, the statistician who compiled the figures at the ONS, said yesterday that transport department officials objected to the form in which the figures were presented. "I was told the DfT did not think it was appropriate to publish them, they spoke to me several times, and in the end I withdrew the report and substituted another which did not mention transport at all".

Mr Francis added: "I would not say I was subject to improper pressure. I just decided I would withdraw it".

His new report published last Friday received no press coverage. However he has placed the statistics on the ONS website "for the record".

Yesterday the DfT denied its intervention had been made for political reasons, and stressed that there was no ministerial involvement. A spokesman said there had been differences between the way the department compiled its statistics and the ONS methods. However, there was no suggestion that the ONS figures were inaccurate.

Mr Blair, writing in this month's edition of the Parliamentary Monitor, said: "Climate change is probably in the long term is probably the single most important issue we face as a global community - the issue is now very, very critical indeed."

Margaret Beckett made a statement on May 18th, two days before the proposed ONS report was withdrawn, that the attack by the Liberal Democrat Leader Charles Kennedy on the UK's climate change record was "absurd", adding "Tony Blair is renowned and respected across the world for his leadership on international climate change".

OUR COMMENT: Leadership involves actions as well as words. Actions have been few and far between and are clearly not enough. Some actions, such as the policy of expanding aviation will clearly undo all the attempts already being made to deal with this "single most important issue". For a start, Tony Blair should exercise leadership and tell Alistair Darling to revise his aviation plans . This will be no immediate damage to anyone or to the aviation industry who are, so we are told, mostly making reasonable profits at the moment. It is very debatable if the future of the UK economy will suffer - there are other industries needing investment. Travellers' choice will still remain. BUT some positive action will have been taken for the future of our environment. We also ask how many other DfT statistics are massaged when considered undesirable?

Pat Dale

THE CHAIRMAN: We will now get a perspective on the other airport that is being considered for runway development. Geoff Gardner will tell us about Stansted.

GEOFF GARDNER: I will deal with some of the background and impacts, and the interrelationships between airport planning and regional planning. I will also touch on a legal challenge in which we are engaged.

This is a very touchy subject, and I have to enter a disclaimer. These are my own views and do not necessarily represent the Council's views. The figures are calculated but are approximate and will be subject to further analysis. I do not think I am going to say anything particularly startling, but you have to say this. Also, I would not say that some of my numbers have been carefully calculated. They are pretty round numbers, so please bear with me.

The Gatwick Challenge
John Steel was part of the challenge to Gatwick, but a fat lot of good it did us in the end, because it resulted in a second SERAS; but at least it put it an long way into the future. That is good news for Gatwick, but perhaps not for others. Our position on this - that of the county council and the whole region - was to accept the inevitable. To make the numbers add up in response to SERAS, we had to say that we recognised that the full capacity would work. We did a back-of-the-envelope calculation which showed that no more capacity was needed before 2016, but I will not re-run that. That was our position, and we now face dealing with probably two proposals in quick succession.

Government White Paper proposals
I will not spend a lot of time on this. A second runway is proposed at Stansted, to be operational in 2011 or 2012, and they are expecting BAA to do detailed plans in 2004. The capacity of that runway is 81 million - about what Heathrow is doing at the moment - and the word is that the existing runway can take 35 million. But these are very moveable figures. We are fortunate to have taken on someone recently who used to work for BAA, and he has told us a little about what happens behind the scenes. The capacity work by BAA for the first runway gives a figure of about 42 million. All figures are moveable, but that is one we have lodged. The third runway at Heathrow, after Stansted, is not dependent on Stansted going ahead. The second runway at Gatwick will be built some time in the future.

Site Map
This shows the existing Stansted runway in red and the airport boundary in green, with the proposed second runway and airport boundary. This is deliberately lifted from the White Paper, because it is headed "The Government's indicative plan of the proposed new Stansted runway and boundary". In all the discussions so far, BAA do not take this as an indicative plan at all: they take it as "the plan". The other point to note from this map is how wide apart those two runways are - about 2km or 3km. At Heathrow they are an awful lot closer, and with mixed mode - in other words, working both together. So why are these two so far apart? The locals immediately think, "That is so they can slot runways 3 and 4 in between them without requiring too much extra land." I am just speculating.

Noise map
This simplified map shows in green the area affected by noise - it is at 54dBA, and you can use 57 or whatever, but I am taking 54 for the moment. You can see how much larger that becomes with the second runway in the red area. We heard this morning that half the population fly. That means that half do not. If half the people in that red area do not fly, they are not going to be too happy. That is an obvious point, which does not apply only to Stansted.

The Legal Challenge
We have launched a legal challenge. We got a taste for it with Gatwick. It does not go to the heart of Government policy, because lawyers will tell you that that is very difficult. But the White Paper is a little too specific about the location of the runways, for example. Putting maps of that detail into a White Paper goes a little beyond Government policy.

There are no obvious reasons, in our view, why other options for the runway were dismissed in favour of this one. There is not the balance between evaluating environmental costs and economic benefits that we would have liked to see as justification for doing that, although they were trailed pretty heavily in SERAS. Lastly, the funding and viability of all this is not dealt with. It was also trailed in SERAS, but it is not dealt with in the White Paper. We are interested in some of the things that have been said today about how close the two proposals will be at Stansted and Heathrow. We are also aware of the CAA stand-alone assessment: does Stansted work on that basis? We have had some work done, and it needs to be dealt with.

We readily accept that some of these points can be dealt with in a planning inquiry, and we hope they will be, no matter how long it takes. They go to the heart of some of this stuff. I think that the Government, and certainly the BAA, are relying on the fact that it is done and sorted - it is in the White Paper and we cannot talk about it. One of the reasons for our legal challenge is to say that we very much can talk about it.

Housing and jobs
I will now deal with the relationship between the airport growth and regional planning. In the East of England region, we are in the middle of a regional plan, and a slight delay has been caused by the need to find many more houses than we thought we had to find. We are cruising towards a draft of the regional planning guidance in the autumn of this year. Lord Rooker originally said that we did not have to worry too much about the second runway, but he has now told us, "As the thing has been delayed and I am asking for more housing numbers, would it not make sense at least to see what the impact of the second runway will be?" I am generally happy with that - hence the need for my disclaimer - because we need to get this thing over and done with. We do not want wave upon wave of housing coming our way. We need to see the big picture in all of this.

The regional assembly has therefore agreed to a large number of houses in what we call the Stansted-M11 sub-region, around Harlow, with 28,000 more houses and 30,000 jobs - which would roughly double the size of Harlow. That is a large impact, and the local authorities in the area have said that Harlow could expand by about half those numbers and still work. Lord Rooker is asking for even more houses in this corridor, 18,000, and bringing together the houses, the jobs, the airport and transportation goes to the heart of regional planning. The population increase would be about 60,000.

Associated costs
This is where we get into round and probably big numbers. The airport land take on the map I showed you is about 8 sq km (three square miles), and the existing take is 10 sq km. It has nearly doubled the area, as you can see from the plan. More important, the associated urbanisation - the jobs, the houses, the roads and everything else - would take about 15 sq km, very roughly. That is the impact of the second runway on what is still quite a rural area. When we heard just now about the schools and houses in Hounslow, Brian said to me that there are not that many around Stansted, because it is a rural area. Nine square miles (23 sq km) of urbanisation in a rural area is quite significant. The population increase of 60,000 people will all need schools, health facilities and so on. That will have massive impacts on this area.

The Transportation system
The transportation system currently based on the roads is what you see here. There is clearly a need for rail capacity into London. The current 25 million figure at the airport was pretty much said to be reaching the limits of what this system can take.

Transportation costs - major roads
These are some of the major costs associated with that development - not just the runway but all the urbanisation. We need to look at this big picture and not try to break it down. If the M11, the motorway that runs north-south, is improved to the north, it would cost £120 million, but we reckon that another £400 million, plus junction improvements, would be needed to the south, as well as to the north, which have not been fully factored in. The White Paper says that the M25 needs improvement; we reckon £512 million would be needed for that. Even with a dual four on both those roads, I am told that the capacity just is not there for the numbers of people we are talking about.

As for east-west links, the A120 all the way to the A12 at Colchester is partially recognised to the tune of £250 million; we reckon that another £300 million is required. To the west, to link through the A120 to the north of Harlow would cost £400 million. Radial roads around London, which are beginning almost to make an outer radial route, would cost about £150 million, and that is just the small bits we know about. We think that the £800 million that the White Paper says is required for transport infrastructure is an under-estimate. We think it is £1.3 billion just for roads.

Rail improvements
The White Paper recognises that what is known as the West Anglian mainline needs about £700 million of improvements. This is about lengthening platforms and getting trains into Liverpool Street. Even so, there are severe doubts about capacity. A much more radical approach would be needed when cranking the airport up to two runways. We think that Crossrail is the radical way of building real new railway capacity in this area. This is where the numbers get really big - it would cost £10 billion. I suppose that that has not been very carefully costed, but you can understand the scale of all this rather than the detail.

Total Costs
The total transportation costs - I have not begun to say who picks up the bill - are about £13 billion. The White Paper and discussions I have had talk about the cost of Stansted runway 2 being £4 billion. That is just the tip of the iceberg - the bit around the airport and connecting it to the existing road system. These costs need to be thought about carefully before we embark upon a planning proposal which may not be fully thought through. It will impose all sorts of blight on an area, and if it does not stack up and the money is not there, that is a huge waste of everybody's time and the cause of great anxiety. The message about how much this will cost is not directed necessarily at BAA or the airline industry: it is directed at Government. The money has to come from somewhere. Essex is a big place, but it does not have that kind of money - far from it.

Phasing
Stansted is running out of capacity, and BAA have identified a need to achieve the full capacity of the existing runway. They expect that self-standing proposal to be made very soon. On the heels of that is the second runway proposal, and the two get very close. How do you separate them? When does transportation needed for the first begin to stray into the second? Don't you need the big picture before you start down this path? That is the message we are sending. The local authorities have said that they need to see the big picture before they can start to deal with the slices of salami that could lead up to it.

Given the cost, there is no compromise on the infrastructure I have described. We have heard many times from Government and others recently that there is no question of growth without adequate infrastructure, and we do not take that lightly. We are very serious about it.

Working together
We are talking to BAA on a "what if?" basis, given that we are still in the middle of our legal challenge; but we are engaged in this positively. The authorities in the area - two counties and a lot of districts - are dealing with this problem to make sure that we do not have a two-year inquiry, if that is what it comes to, and that there is agreement as far as possible. We are not going to argue for the sake of it, but, if some time is saved, it should be backed up with promises from the Government or BAA to deliver the infrastructure that goes with it.

Finally, we need to recognise the relationship between airport growth and regional and sub-regional planning, infrastructure, houses and jobs. They cannot be dealt with as individual projects: they need to be seen as a whole. Thank you.

THE CHAIRMAN: Thank you, Geoff. If ever there was a call for joined-up government, that was it: all about the cost implications and the other challenges.

Ryanair boss Michael O'Leary is not one to mince his words. His "Screw the Share Price" comment earlier this week signalled his determination to continue the price war amongst the low-cost carriers, despite the impact upon Ryanair's profits and upon its share price.

Michael O'Leary's words will not be well received by City investors already concerned about Ryanair's recent profits warning. There are worries too about the impact of the recent oil price hikes, ongoing problems with the EU Commission on subsidies at Charleroi Airport and elsewhere, and the prospect of EU emissions charging being introduced for air travel. All these factors threaten Ryanair's future prospects.

Ryanair accounts for 70% of Stansted's business and so one assumes that BAA will be taking a close interest in these developments, not least because BAA wants to double its charges at Stansted over the next four years and expects Ryanair to pay up.

And if BAA wants to proceed with its plans for a second Stansted runway, charges would need to virtually double yet again in order to justify the cost of this investment. Mr O'Leary does not seem like the type of individual who would just sit back and accept this and BAA shareholders must be wondering whether its management is being a bit starry-eyed about the financial viability its grand investment plans for Stansted.

This is just one of the many dilemmas that BAA is facing in relation to its Stansted plans and BAA annual results, published last week, highlight the fact that it is not only Ryanair who is finding that passenger growth does not necessarily mean profits growth.

Ryanair is refusing to pay back alleged state subsidies from the low-cost carriers's operations at Belgium's Charleroi Airport.

Michael O'Leary, Ryanair's chief executive, said the Belgian authorities had written to the airline demanding the repayment of about £2m (3m euros). "We have written back to say f*** off" he said yesterday.

He said Ryanair had incurred costs eight times higher in setting up its base at Charleroi and that the airline had the right to offset these costs against the alleged subsidies.

Ryanair yesterday formally launched its appeal against the decision of the European Commission, announced in February, that various benefits it had received at Charleroi, south of Brussels, constituted illegal state aid.

Ryanair said it was asking the European Court of First Instance to annul the Commission's "flawed decision".

Under the state aid rules, a public airport must be able to compete on a level playing field with private airports and offer the same conditions, said the airline. Charleroi airport, which became Ryanair's first base in continental Europe in April 2001, is owned by the regional government of Wallonia.

The airline claimed that the Commssion had "completely ignored" the fact that the airline had lower costs at some private airports.

In addition, the group claimed that the Commission had ignored the fact that the deal was "specifically offered to other airlines willing to make the same investment in the airport as Ryanair".

Ryanair said last month it had struck a new deal with Charleroi that would leave net charges on existing routes from the airport at the same level that first triggered the state aid investigation by the Commission more than two years ago.

OUR COMMENT: It gets more and more complicated! What about competition between private airports owned by the same company? Are cross subsidies from Heathrow to Stansted unfair competition? Or just BAA's own business - apart from the new CAA rules of course!

Pat Dale

Warwick District Council has failed in an attempt to win a high court injunction stopping Thomsonfly's embryonic operation at Coventry airport.

The local authority claimed that the new budget airline was using an illegally built structure to turn the freight airport in the West Midlands into a passenger terminal.

A judge disagreed, although the Council intends to challenge the operation again at a planning inquiry likely to take place in the autumn.

OUR COMMENT: We understand that the airport owners had built an extension at the airport and allowed the new airline to commence operations without getting planning permission. The airport has appealed against an order to demolish the building and to cease the passenger services. It seems extraordinary that such a development could take place without any planning permission. Our understanding is that the judge decided that the issue should be decided by the Inspector at the Appeal Hearing. The failure to get an injunction to stop flights seems to go against all the relevant Planning Laws but we have not seen the full judgement.

Pat Dale

Russian president Vladimir Putin has given the clearest indication yet his country will ratify the Kyoto protocol and thus trigger its entry into force. "We are for the Kyoto process... we shall be speeding up our movement towards ratification," he said after an EU-Russia summit in Moscow on Friday.

Russia's ratification would provide a powerful political boost for the EU. The bloc has championed the Kyoto protocol internationally and aligned its domestic climate change policies closely to the treaty, to the extent of committing to meet Kyoto gas reduction targets even if the protocol doesn't enter force.

Rising concerns in Europe's business community over climate change policy have been strongly linked to fears that Russia might not ratify, which would potentially leave the EU politically and economically isolated. The same fears prompted EU energy commissioner Loyola de Palacio to suggest that the EU needed a "plan B" in case the protocol never entered force (ED 30/01/04 http://www.environmentdaily.com/articles/index.cfm?action=article&ref=15991).

Mr Putin's comments followed the successful conclusion of bilateral talks on the terms of Russia's entry into the World Trade Organisation. Though EU negotiators had consistently denied a diplomatic trade-off between the two issues was on the cards, the president said they had "overlapped".

"The fact that the EU has met us halfway in negotiations on the WTO could not but have helped Moscow's positive attitude to the question of ratifying the Kyoto Protocol," he said.

The European Commission has reacted cautiously to the announcement. Reijo Kemppinen, spokesman for president Romano Prodi, said it was "very positive" but added that "in terms of a time line there's nothing specific yet."

One result of Russian ratification is expected to be an increase in the market price of credits from the Kyoto project mechanisms CDM and JI that many EU governments and firms expect to use to meet their greenhouse gas reduction commitments. Once the protocol enters force both Japan and Canada are expected to enter the market as significant buyers.

Tim Atkinson of carbon market broker Natsource told Environment Daily on Monday that prices had not yet moved, however. "[Putin's statement] sends a signal that Kyoto is getting ever closer, but it will take time to filter through to the market," he said.

Stephan Singer of WWF welcomed the presidential statement: "it will make some governments and businesses realise that Kyoto's here and they'll have to get used to it," he said. But he warned there were "still a lot of anti-Kyoto people" in the Russian power hierarchy and that ratification was not cut and dried.

This realisation may well be behind the EU's guarded reaction. Mr Putin said Russia still had "certain concerns as to the liabilities we shall be expected to assume"; the country's parliament must give its approval before ratification can happen. Moreover,Russia's academy of sciences last week came out against the protocol,joining vociferous presidential advisor Andrei Illarionov .

Under the protocol's rules, developed countries representing 55% of 1990 carbon dioxide emissions must ratify to trigger entry into force. Since the USA abandoned Kyoto in 2001 Russia's participation has become critical to meeting the target. Currently states representing 44% of 1990 emissions have ratified. Russia accounts for another 17%.

China's industrial development is unsustainable because its people, resources and environment cannot cope. This assertion, published yesterday, was not the intellectual musing of a green pressure group. It was the conclusion of the State Environmental Protection Administration, a branch of Beijing's Communist governments not known for rhetorical bombshells.

Pan Yue, deputy director of SEPA, said China adopted the west's resourtce-hungry model of development even though it was unsuited to a country with a huge population, limited agricultural land and scarce resources. The solution was to develop renewable energy sources, slash waste and promote recycling. He said "If we continue on this path of traditional industrial civilisation, then there is no chance that we will have sustainable development. China's populace, resources, environment has already reached the limit of its capacity to cope. Sustainable development and new sources of energy are the only road we can take".

The report goes on to detail the rising consumption of resources and land, notably oil and water, and what would happen if expansion continued in the same way as it has in the US and in much of Europe.

OUR COMMENT: Such comments have been made by many in the West, but rarely in such forthright terms by an official government agency. On a smaller scale they are very familiar. The aviation industry in particular is ignoring the limitations of our resources and is being encouraged to do so by the government. Stansted airport is being encouraged to expand to a size that ignores both local environmental limits, water supplies and air space, and would cause more damage to our national climate patterns.

Global warming is hitting the Arctic more than twice as fast as the rest of the planet in what may be a portent of wider catastrophic changes, the chairman of an eight nation study said, Reuters reports from Oslo.

An 1,800 page report is to be handed to Ministers in Iceland later this year. Robert Corell, chairman of the Arctic Climate Impact Assessment said, "There is a dramatic climate change happening in the Arctic right now...about three times the pace of the whole globe. If you want to know what the rest of the planet is going to see in the next generation, watch out for the Arctic in the next 5 - 10 years".

The report contains evidence of thinning ice, disruption of the habitats of plants and animals and the destabilisation of buildings on permafrost, including an oil pipe line laid across Alaska.

Pat Dale

The financial cost of countering terrorism has hit profits at London Stansted Airport.

Strong growth - passenger volumes soared 15.9 per cent to 19.4 million - boosted total revenues 7.6 per cent to £141m. But the operating profit was down 9.3 per cent to £39 million and operating costs were £15m higher at £102m. Stansted officials said this was "mainly due to heightened security and insurance costs."

Retail revenue of £60 million was £7.3 million higher than the previous year, an increase of 13.2 per cent, and airport charges were 3.8 per cent ahead at £54 million.

Ongoing expansion at the Essex hub brought capital investment of £19 million and airport chiefs say that to cater for the expansion of low cost airlines, £662 million will be invested in facilities over an 11-year period.

Managing director Terry Morgan said: "It has been an exciting and challenging year for Stansted, the highlight of which was the publication by the Government of the Future of Air Transport White Paper."

"This marks an important step and places Stansted at the heart of the revolution in air travel. We have more passengers than ever before and we will shortly welcome our 20 millionth in a 12-month period."

"To manage the rapid growth in traffic we have had to make a step increase in the airport's operating capacity. This has meant investment in additional staff and other operating expenditure, rather than capital investment."

"The operating base now in place should support anticipated growth at Stansted this year and lead to an improved profit performance going forward. Our success has opened opportunities for travellers, businesses and the local community."

"We are confident in our future and expect strong growth in passenger numbers in 2004/05. We are proud to be the fastest growing major airport in Europe."

The latest figures show 1.7million travellers passed through the airport in April - an annual running total of 19.8million and a 33.9 per cent growth on the same period last year.

Days later, BAA Stansted announced an operating profit of £39million at the end of the financial year, a 9.3 per cent fall on the previous year.

Managing director Terry Morgan said: "It has been an exciting and challenging year for Stansted, the highlight of which was the publication by the Government of the Future of Air Transport White Paper."

"This marks an important step and places Stansted at the heart of the revolution in air travel."

"We have more passengers than ever before and we will shortly welcome our 20 millionth in a 12-month period."

"To manage the rapid growth in traffic we have had to make a step increase in the airport's operating capacity."

"This has meant investment in additional staff and other operating expenditure, rather than capital investment."

"The operating base now in place should support anticipated growth at Stansted this year and lead to an improved profit performance going forward."

Retail revenue of £60million was £7.3million higher than the previous year, an increase of 13.2 per cent, while airport charges were £54million, up 3.8 per cent.

Capital investment stood at £19million. To cater for the expansion of low-cost airlines £662million will be invested in facilities over an 11-year period.

Operating costs, including depreciation, rose £15million to £102million, mainly due to heightened security and insurance costs.

Carol Barbone, campaign director of Stop Stansted Expansion, said the announcment that profits had fallen despite an increase in traveller numbers indicated a 21 per cent decline in income per passenger, from £2.58 to £2.03.

She said: "This is the lowest of all of BAA's seven airports."

"It is totally at odds with BAA saying, earlier this year when under pressure to explain Stansted's low profitability in relation to the amount of money it had invested, that it expected to substantially increase Stansted's profitability."

Commenting on the passenger numbers, communications director Mark Pendlington said: "We are tantalisingly close to being able to celebrate our 20 millionth passenger this year."

"These figures tell us how right we have been to announce our intention to apply for permission to increase capacity beyond the current limit of 25 million passengers per year."

OUR COMMENT: The reduced profits are blamed on the increased operating costs, mainly due to security requirements. The main report comments that increased "marketing support" was required at Stansted because of the takeover of Buzz by Ryanair. (Did Ryanair get any reduction in charges?) It is also stated that airport charges were put up at Heathrow and Gatwick but not at Stansted. Is another runway at Stansted really a good investment opportunity?

Pat Dale

South East England has less water available per head than Morocco, Egypt or Kenya. Thames Water have been telling us through the local press that levels in their boreholes, from which they draw underground water, are below average. They say that the steadily growing population in the South East combined with the increasing evidence of climate change will put growing pressure on local supplies. They are asking customers to use as little water as possible.

Meanwhile, Three Valleys Water say that Government proposals for new housing developments could result in them having to provide water for a further 500,000 households. Part of this increase is linked to the proposal to expand Stansted Airport to be a third larger than Heathrow is at the moment.

Three Valleys Water say that they need to invest £150 million over the next five years in upgrading their network of water mains to address the critical issues they face, such as the highest level of customer demand in the driest part of the UK. This will involve higher customer bills - starting with a 15% increase in 2005/6 followed by a 13% increase in 2006/7. Clearly existing customers should not have to bear the burden of investments for developments for which they are not responsible.

Three Valleys Water should now reveal the contribution BAA will be making to these infrastructure investments, given that BAA will benefit not only directly through its increased use of water at Stansted Airport, but indirectly through the housing of thousands of new employees and through the establishment of hotels, offices and warehouses in the Stansted area.

Climate change is racing up the corporate agenda and has even touched ExxonMobil, according to an institutional investors' survey due out next week.

Almost three times as many firms responded to this year's annual survey from the Carbon Disclosure Project (CDP), a group of institutional investors holding assets worth $10,000bn (£5,700bn), the same as the US gross domestic product.

British oil groups BP and BG along with banks Abbey National and HSBC were deemed among the best in their class on the basis of the responses.

Compass Group, the caterer, was among the British firms that failed to respond, but so too did aircraft manufacturer Boeing. Exxon - historically antagonistic to the Kyoto treaty and other climate change initiatives - ignored survey questions sent to the top 500 global companies.

But this time the Texas oil firm gave "intelligent and thorough responses", said the CDP, which is backed by ABN Amro, Swiss Re and Jupiter, among others. Next week Exxon is expected to face pressure from shareholders on climate change at its annual meeting.

The number of participating companies rose from 35 last year to 95, with a majority saying climate change presented risks but also opportunities to their businesses. "The world's most powerful investors have an obvious reason for wanting to avert climate change. It would devastate their wealth," said James Cameron, the CDP chairman. "What's positive about our report is that it reveals that the world's largest corporations are increasingly responding to this demand by quantifying and reducing their greenhouse gas emissions," he added.

But Mr Cameron admitted that more than 40% of companies ignored the survey while others offered very weak responses to the questionnaire.

The response from Exxon - and ChevronTexaco - was especially welcome because the list of questions was considerably longer than last year's.

CDP declined to provide any details about the Exxon response, but a spokesman said the exercise could be considered a major breakthrough. "Exxon has been cast in the role of a backward company - but their responses were intelligent and thorough, and suggest they have changed their position. That's progress," he said.

There was equal surprise that a company as potentially exposed to climate change as Boeing should not reply to the survey, especially because the signatories to the disclosure project are understood to control more than 10% of its stock.

CDP believes most business leaders are beginning to take climate change seriously after weather-related disasters cost industry $70bn during 2003. There is also pressure because rules are being developed across the OECD favouring a shift to a low-carbon economy, meaning the "cost of carbon" is becoming a headache for energy-intensive global firms.

CDP analysis suggests even a 5% shift in energy prices could affect per-share earnings by 15%, so risk management and energy efficiency are taking on a new level of importance.

Jeff Gazzard comments:

Not a big surprise that Boeing should fail to respond to the survey from the Carbon Disclosure Project, according to Terry Macalister's article above.

At the launch of its new 7E7 aeroplane a couple of weeks ago, Mike Bair, Boeing's senior vice-president, admitted to a group of journalists that the new plane's appearance had more to do with marketing than aerodynamics, saying that Boeing would even be willing to sacrifice a small amount of efficiency in order to preserve the so-called "Dreamliner's" unique appearance.

What this means is that Boeing are deliberately and calculatedly manufacturing an aircraft with less than optimum fuel consumption just for appearances' sake, a sad reflection on just how far down the list optimising environmental performance is in Boeing's world. Boeing claim that the "E" in the 7E7's nomenclature stands for "Environment". It seems to us that it should stand for "Excessive fuel consumption".

The very fact that the institutional investors behind the CDP scheme hold more 10% of Boeing's stock, as Terry Macalister reported, should be a powerful wake-up call to the aeroplane manufacturer to take climate change seriously - but as long as marketing men are designing Boeing's aircraft to look good instead of letting their engineers squeeze the last drop of fuel efficiency from their airframes, we can't really expect much better.

Perhaps these same investors can be encouraged to demand that Boeing achieve the very best fuel consumption from the 7E7. Every reduction in greenhouse gas emissions helps, which presumably is what the Carbon Disclosure Project is all about. Let's hope they manage to put pen to paper and pressure Boeing to manufacture an aircraft with maximum fuel efficiency.

"The underlying strength of our airport operations, retail offering and UK passenger traffic has been clearly demonstrated over the year. BAA has served more passengers than ever before, invested record amounts of capital in our UK airports and delivered profit growth. We are confident in our strategic objectives to deliver increased airport capacity, better facilities and improved service."

"Our profit performance has been achieved despite a £54 million adverse impact in the year as a result of accounting for pensions under FRS 17 and the significant investment in our operating base aimed at better levels of service to passengers and airlines. There is absolutely no doubt that improving service quality, both in terms of a passenger's ease of progress through security screening and the availability and reliability of facilities, leads to higher retail income and a more satisfying experience for passengers."

"Looking forward, although the international political outlook is likely to remain uncertain, we believe that robust passenger traffic growth will continue as the UK economy strengthens, along with those of key regions such as North America and Asia. We confirm our forecast of more than 6% growth in passenger traffic at our UK airports this year."

"From 2008, when Heathrow's Terminal 5 opens, our biggest and most profitable airport will have an additional 50% passenger capacity. And as a result of the Government's long-term policy framework for air transport, BAA has the opportunity to continue its leading role in UK aviation and provide vital new airport infrastructure while delivering long-term, profitable growth."

The main part of the Report:

Overview

BAA plc, the international airport company, today announced that for the year ended 31 March 2004 Group revenue increased by 4.7% to £1,970 million (2003: £1,882 million restated1) on passenger traffic growth of 4.4%. Group operating profit2 was up 4.9% to £616 million (2003: £587 million), reflecting the growth in Group revenue partially offset by a 4.6% rise in Group operating expenditure to £1,354 million (2003: £1,295 million restated).

As foreseen, operating costs have increased through a combination of security related pressures and planned investment in higher levels of service. In the two years following the incidents of 11 September 2001 BAA has recruited 1,490 additional security staff, underpinning the company's commitment to the safety and security of all passengers and employees using its airports. The employment costs of these additional staff, along with wage inflation, additional pension and national insurance charges, the investment in maintenance to improve equipment reliability, and the expenditure required to service new facilities have contributed to the growth in Group operating expenditure. Operating costs also include £4 million in respect of the cost of trading property sales (2003: £24 million).

Profit before tax and exceptional items increased by 2.3% to £536 million (2003: £524 million) as a result of the £29 million growth in Group operating profit, £25 million reduction in the Group net interest charge to £91 million (2003: £116 million) and £5 million increase in the Group's share of profit from joint ventures and associates. This was partially offset by the £40 million reduction in FRS 17 finance income (reflecting the value of the pension scheme at 31 March 2003) and the discontinuation of the BMG joint venture profit share (which yielded an operating profit of £7 million in 2003).

The financial year was one of four distinct quarters with results in the first quarter, to 30 June 2003, heavily influenced by the Iraq War and the SARS epidemic, both of which adversely impacted long-haul traffic, particularly at Heathrow where traffic fell by 2.2% and operating profit by 2.3%. Across the UK airports, however, the resilience of short-haul traffic, fuelled by the continued growth of the low-cost airlines, offset the decline in long-haul traffic. Overall, passenger numbers rose in the first quarter by 2.2%. However, the planned increase in Group operating costs offset the growth in revenue, resulting in a 6.3% decline in Group operating profit to £148 million.

The crucial peak summer season, the second quarter to 30 September 2003, saw the first real signs of recovery in long-haul traffic and overall passenger growth of 2.8%, driven by growth of 0.4% at Heathrow, 14.2% at Stansted and 3.4% in Scotland. However, the continued weakness in charter traffic saw Gatwick passenger numbers decline by 0.5%. In the second quarter Group operating profit rose 2.0% to £203 million.

This trend of improving passenger, revenue and profit performance continued into the third quarter to 31 December 2003. Overall, traffic grew by 5.6%, with growth at all three south-east airports (3.4% Heathrow, 1.3% Gatwick and 19.5% at Stansted). We also saw 3.2% traffic growth in Scotland and Southampton continued its dramatic growth, up 72.8% following new route development. Group operating profit increased 8.0% to £149 million.

In the final quarter, to 31 March 2004, despite continued terrorists threats impacting certain routes from Heathrow and the terrible attacks in Moscow and Madrid, performance benefited from the comparison with the start of the Iraq conflict in mid-March 2003. Overall, traffic grew by 8.1%, with Heathrow seeing growth of 7.6% (having been the airport most adversely impacted in March 2003 by the Iraq War). The growth in traffic and a number of one off items during this period led to a 26.1% increase in operating profit in the final quarter (£116 million).

UK airports (including WDF)

Revenue £1,824m (2003: £1,710m restated); operating profit £578m (2003: £557m)
UK airports revenue (including WDF) increased 6.7% for the year, primarily due to the 4.4% growth in passenger traffic, a strong retail performance and the increase in airport charges per passenger at Heathrow and Gatwick. These factors drove the 3.8% increase in operating profit of the airports to £578 million (2003: £557 million), despite the 8.1% uplift in operating expenses to £1,246 million (2003: £1,153 million).

Airport charges
Airport charges increased 7.8% to £717 million (2003: £665 million), largely due to the increase in tariffs at Heathrow and Gatwick and the 4.4% growth in passengers, partly offset by the increased marketing support at Stansted (particularly as a result of the Ryanair acquisition of Buzz at the beginning of the year), Scotland and Southampton. UK airport charges yield per passenger was up 4.1% to £5.33 (2003: £5.12).

Retail
UK airport retailing, including the operations of WDF, performed strongly during the year, despite the significant early challenges presented by the Gulf War, the SARS epidemic and the tobacco advertising ban introduced in February 2003. Net retail income grew by 7.5% (£38 million) to £548 million (2003: £510 million) and net retail income per passenger increased 2.7% (£0.11) to £4.12.

Strong passenger growth, especially to non-EU destinations, combined with the benefit of the maturing new space at Terminal 3, Stansted and Gatwick North terminal contributed towards a full year income of £60 million from airside specialist shops, an increase of 9.1% (£5 million). World Duty Free net retail income grew 9.0% to £145 million in the year.

The continuing redevelopment of catering areas, including the landside balcony at Heathrow's Terminal 1 and the landside and airside offers at Stansted, have also delivered improved choice and facilities for passengers. New outlets were opened during the year at all of our seven airports in the UK, and contributed to a 13.2% increase in catering income to £43 million.

Net car park income rose by 6.8% to £142 million, including a full year's contribution from Glasgow Airport's multi-storey car park. Pre-booked car parking sales via our Customer Contact Centre and the internet now constitute 11% of total revenue in this category.

Operating costs
Wage inflation and the recruitment of a further 740 security staff, following the hiring of 750 additional security staff the previous year, led to additional payroll costs of £26 million in the year. Other key contributors to the growth in operating expenditure of our UK airports included increased pension and national insurance costs of £18 million, an £11 million rise in maintenance costs (reflecting the growth in facilities and the drive for improved customer service), and £3 million additional insurance cost. Rent, rates and utilities have increased, reflecting the physical expansion and new facilities at the airports.

Operating profit
At Heathrow, which accounts for 48% of our UK airports' passenger traffic, the 7.8% growth in revenue offset the increase in operating costs, leading to a 7.1% improvement in operating profit. Gatwick suffered as a result of the 6.1% decline in charter traffic, which together with the planned increase in operating costs led to a 2.2% decline in operating profit.

The rapid growth in traffic at Stansted over the past few years and the completion of a number of capital expansion projects required a significant increase in the operating cost base to allow the airport to function effectively. The growth in the airport's operating cost base offset the 7.6% increase in revenue, resulting in a 9.3% decline in operating profit. However, this stepped increase in operating expenditure should support the continued strong traffic growth anticipated at Stansted, leading to an improved profit performance this current year.

Southampton had a record year, with the 72.8% growth in passengers driving a revenue increase of 46.2% and doubling of operating profit. In Scotland, higher security costs, lower airport charges yields and the costs of restructuring resulted in decline in the overall operating profit of the three Scottish airports of 3.6%.

WDF delivered an overall increase in operating profit of 9.1% as a result of higher sales, tight cost control and improved back office processes. Significant developments in the year included the main shop refurbishments at Terminal 1 and Terminal 4, several new specialist beauty store openings, a highly effective summer fragrance promotion and innovative category management.

The whole Report can be found at www.baa.com

What do the figures tell us about Stansted?

OUR COMMENT: The published information (highlighted above) shows that Stansted's profit fell by 9.3% despite a 15.9% increase in passengers handled. Income per passenger therefore declined by 21% from £2.58 to £2.03. This is the lowest of all of BAA's seven airports - the other airports being Heathrow, Gatwick Glasgow, Edinburgh, Aberdeen and Southampton.

BAA said, earlier this year, when explaining Stansted's low profitability in relation to the amount of money invested at Stansted, that it expected to substantially increase Stansted's profitability.

It appears that these hopes have not been fulfilled. Stansted's profitability has moved in the opposite direction. The explanation given is the "increased marketing support at Stansted" especially in relation to Ryanair's acquisition of Buzz, plus the completion of a number of capital expansion projects requiring a significant increase in the operating cost base.

What this careful phraseology means is that no-frills airlines are not in a position to pay and will not pay the kind of airport charges that are required at Heathrow and Gatwick. That situation is not going to change. It raises again the whole question of the vanishing cross-subsidies. How will BAA Stansted pay for a second runway ? Who is going to invest in such a development?

Pat Dale

Virgin Atlantic has surrendered its ambition of being among the launch customers for Airbus's A380 superjumbo, by pushing back its order for the new aircraft by 18 months to late 2007. The airline yesterday blamed the hold up on problems in securing "innovative fittings" for the 550 seat aircraft cabin.

It also cited lack of progress at airports in preparing for the new plane, which has an 80 metre wing span and will need special piers to get passengers on and off.

The article goes on to detail some of Virgin's plans to provide cocktail bars, casinos and buffet style meals. They would have been the second customer with 6 A380s, after Singapore airlines. Air France, Lufthansa, Quantas, Emirates and Federal Express have all signed up.

OUR COMMENT: This plane claims green credentials, with Boeing's 7E7, which carries only 200 to 300 passengers. The fuel reductions claimed will reduce greenhouse gas emissions, but it does not seem likely that these reductions will solve the problem of aviation's predicted increase in CO2 production, and it will make no difference to the problems of contrails, which also contribute to climate change.

We have to remember that the predictions for greatly improved air quality at Heathrow and Stansted were partly based on the future use of "greener" aircraft. The A380 shows no signs of coming to Stansted unless Federal Express is intending to use it as a cargo plane from Stansted. There is no sign that the budget airlines will be purchasing the smaller Boeing 7E7s, though they feature in the predicted fleet mix for Stansted.

Oil prices are important to the world economy, because we still live off fossil fuels. So, it is a matter of some concern to see oil hit a nominal record high of over $41 a barrel yesterday, even though this is little more than half the 1980 peak, which in real, inflation adjusted terms was $78. And the oil price could stay that high for a while. It has been driven up by a mix of factors, including middle east security worries, booming Chinese demand and continuing US energy extravagance. None of these will disappear quickly.

The Leader goes on to comment that there is not much that most western countries, except the US can do in the short term to further economise on fossil fuel use. Oil importing developing countries are in even more difficulties as they do not have the money to switch to introduce energy saving measures. We are all linked as well by economic globalisation. Although the obvious winners are the oil exporters how they spend or save their money will also affect us all.

The Leader finishes "In the light of all this, there's no cause for the world's oil-consuming countries to repeat the policy mistakes of the 1970s when inflation was allowed to rip and real interest rates to go negative. Luckily inflation is low now, and central bank discipline looks solid. Nor should oil-consuming countries attempt to accommodate oil price rises in other ways, either by lowering oil taxes or increasing oil subsidies. One day oil will disappear, and the sooner the world starts weaning itself off the black stuff the better."

OUR COMMENT: DfT please note. Airlines have already put some fares up (even though their fuel is tax free and so virtually subsidised). What about thinking ahead and managing that predicted increase in air travel? Then we can forget about extra runways. Let aviation and air travellers take their fair share of oil problems.

Simon Jenkins writes a blistering attack on current developments in the countryside quoting examples from Herefordshire, Hertfordshire, Woking, Sussex, Hampshire, Cambridgeshire and Bedfordshire. He describes how some unscrupulous developers are using a variety of ways to acquire land, introduce temporary buildings possibly in the guise of holiday caravans or rural workplaces, and then apply for planning permission. When local Councils order them to remove any illegal buildings and refuse permission for any development they appeal, confident that they will win.

Why are they confident? Because John Prescott has announced the government's intention of encouraging a massive house building programme to make up housing "shortfalls". Simon Jenkins comments that he seems to have forgotten that there are 720,000 empty homes, half of which are in southern England. He also attacks the Minister for Rural Affairs who at an Oxford conference apparently while indicating that National Parks and Areas of Outstanding Beauty would be protected went on to suggest that the rest of the countryside would be dedicated to "dynamic rural development".

Simon Jenkins claims that there is a collapse of rural planning and a "parallel collapse of development control. This is the framework whereby in most continental countries planners insist that new building reflects local materials and style. In Britain it means gaudy mobile homes and container sheds spread across the landscape and coastline with no sense of place or context." He goes on to claim that the British have lost the art of building villages and towns. He diagnoses "estatitis" "similar to ribbon development of the 1920s. Spending power is sucked from towns and cities to highway superstores. Roads and utilities must be installed. Car use is encouraged".

OUR COMMENT: He could have included the proposed M11 corridor development "ordered" by John Prescott. This means 131,000 extra houses in Essex alone and the Regional Planning Panel is now struggling to include all the extra houses in the new draft Regional Plan (soon to be called a "Strategy"). There is no doubt in our own local experience that developers are now intent on including as many dwellings as possible in all local planning applications, with densities of over 70 per hectare in place of the 25 of previous years. Such densities can only be achieved if 3 storey blocks of apartments are included and Saffron Walden has had a number of such applications backed up by consultants urging that the government wants higher densities. Our local Council has tried to resist these arguments - such high density developments are not suitable in small market towns, though the first attempt to resist was lost at Appeal.

The enforcement of a Countryside Protection Zone round Stansted Airport shows that a determined Council can preserve the countryside. Now this is at risk from a government approved airport expansion. However, both BAA and the consultants Buchanan, who devised the plan for accommodating John Prescott's extra houses, reduced the number of airport related houses that would be required for an expanding airport. They decided that fewer extra employees would be needed. The bulk of the extra houses proposed in Great Dunmow, Stansted. Henham and Harlow (thereby joining London to Newport and Saffron Walden) were stated to be included in Buchanan's Plan to meet the M11 Plan, not the Airport's needs. This of course is being very economical with the truth. John Prescott is very keen on what he calls "sustainable development". No development can be sustainable unless there are jobs available. It is doubtful if the M11 plan would have been produced if Stansted had not been regarded as an airport to be expanded.

We have to object to both the numbers of extra houses as well as to the airport expansion, either or both could mean a massive urbanisation of Uttlesford countryside.

Pat Dale

The swarms of brightly painted budget aircraft flying over Europe are busier, cheaper and more plentiful than ever. But they are creating a painful headache for air traffic controllers, who face a challenge in coping with skies packed with a record number of flights.

At the present rate of growth Europe's skies will become "full" in little more than a decade, with current procedures unable to cope, according to Europe's top air traffic controller. The warning is set to reopen fierce controversy over the safety of the continent's congested skies. It comes days ahead of the publication of an official report which is likely to blame failures in air traffic control for one of the most devastating air disasters in European history – a mid-air collision over Lake Constance two years ago which claimed 71 lives.

National control centres across the continent are coordinated by a network run by a Brussels-based agency, Eurocontrol, which matches take-off and landing slots in 33 countries stretching from Ireland to Ukraine. In a typical 24 hour period Eurocontrol looks after 29,000 flights. Despite a slowdown in air travel following the terrorist attacks of September 11th 2001, it predicts that annual traffic across Europe will double to 16m aircraft by 2020.

Victor Aguado, director general of Eurocontrol, said last week: "in the middle of the next decade, we shall reach capacity using the present systems. Beyond that, we'll need something else, which today's technology can't provide."

To cope with booming numbers of flights, the minimum height separation between aircraft has already been cut from 2,000 ft to 1,000 ft. Safety experts are now working towards "self-separation" technology that will limit the role of controllers by improving electronic equipment allowing aircraft to set safe paths away from each other automatically.

At any daytime moment, there are 3,500 aircraft in the skies over Europe, carrying some 400,000 people. One in ten of them is operated by low cost airlines, which have come from nowhere to create a booming industry over the last decade.

To the consternation of experts, much of the growth is forecast to come from the east European states, where budget airlines are looking for new destinations. Safety chiefs have warned that the quality of air traffic control in Europe's new member states is variable.

Erik Merkx, Eurocontrol's head of safety enhancement, said: "If we don't get these new states up to speed, with the increasing traffic levels we're predicting, we will have a problem."

No-frills revolution

Ireland and Britain led the way in the no-frills revolution through Ryanair and EasyJet, which are well established as the top two low-cost carriers in Europe. Scores of also-rans have entered the market, including nine budget airlines based in Germany alone.

Next month a Hungarian carrier, Wizz, will enter the battle, offering flights from Luton airport to Budapest and Katowice in Poland.

While annual growth in traffic is set to be a modest 3% in Britain and 2.9% in France, a proliferation of services is forecast to increase flights over Ukraine by 7%, over Belarus by 5.5%, over Turkey by 5.9% and over Bulgaria by 5%.

Eurocontrol reckons six states have safety management below "acceptable" levels though it declines to name them. While Britain's air traffic control scores more than 95% for safety and maturity, three countries languish below 20%.

Unions warn that progress could be tough as free movement of labour within the enlarged European Union allows experienced controllers to move west in search of better paid vacancies. Shane Enright, aviation secretary of the International Transport Workers' Federation, said: "There's a Europe-wide shortage of controllers. There needs to be harmonisation of pay and conditions, otherwise these new member states are going to lose out."

Cost pressures are tight: no-frills carriers are reluctant to pay anything they can avoid for air traffic control. Ryanair's outspoken boss Michael O'Leary last year accused safety authorities of building "marble palaces" for their staff rather than providing the basic service needed.

Swiss air traffic control said last week that four near misses occurred in its airspace in April alone. A close shave between an Iberia passenger plane and a business jet over Zurich could have had "disastrous consequences", according to Switzerland's NZZ am Sonntag newspaper.

The Swiss, who handle a key corridor for aircraft passing over the heart of the continent, will come under further pressure on Wednesday. German investigators are due to publish the results of a two year examination of the Uberlingen disaster, in which a DHL freight aircraft crashed into a charter aircraft packed with Russian school children.

The accident is expected to be blamed on mistakes by Peter Nielson, a controller working the night shift in an inadequately staffed Swiss control centre. Mr Nielson was stabbed to death in February by a grieving Russian father who lost his wife and two children in the crash.

The Uberlingen crash was Europe's third fatal accident in three years caused by errors in air traffic control. It followed collisions on the ground at Paris's Charles de Gaulle airport in 2000 and Milans's Linate airport in 2001. The sequence ended a 16 year run without any deaths.

Eurocontrol admits it is concerned about the trend. Mr Aguado said: "It worries us a lot when we see two accidents on runways in successive years and a mid-air collision – which is something that Europe has not experience for many years."

It is working on a new system which will give controllers an 18 minute warning of any potential collision, rather than the present 2 or 3 minutes.

At present one in 10m flights ends in an accident caused by air traffic control. But in the constant congestion at 30,000 ft predicted by 2020, that rate could mean two disasters in Europe's skies a year.

OUR COMMENT: After that depressing picture we wonder again at the irresponsibility of any government not only allowing a big expansion in air traffic without full confirmation from air control authorities that such expansion is safe, but in also promoting a policy for a new runway at Stansted without any plans for flight routes, with the risk of possible congestion with Luton traffic and even Heathrow, and further congestion in holding areas, one of which is shared with Luton. We expect to learn about these plans when the expansion applications are finally published. It would be madness to consider any application without vital information on flight paths. On them depend not only safety but also noise and air pollution distribution on the ground.

Pat Dale

A REMINDER to all your readers that the consultation process on BAA's Home Owner Support Scheme (HOSS) closes on Monday, May 31.

We would like to hear the views of as many local people as possible on the options we have put forward.

The scheme is a voluntary initiative launched by BAA to offer compensation to home owners who live outside the proposed expanded airport boundary, but whose property values might be significantly affected by the proposed new runway.

HOSS enables those who qualify to sell their homes without financial penalty and move, if they want or need to, before the new runway opens.

If readers would like to find out if they qualify for the scheme, or if anyone wishes to take part in the consultation, an explanatory booklet and map are available by calling 01279 663014, or email stansted.consultation@baa.com

TERRY MORGAN
Managing Director
BAA Stansted

OUR COMMENT: Comments are invited from all local people, not just those that BAA has written to. If you have not seen the leaflet, do telephone or email BAA as suggested above - you have 2 more weeks to answer.

If you want to see what SSE's views are you can read them here.

Remember that the White Paper made it clear that BAA would be expected to produce a scheme for those whose houses have been "blighted" by the runway plans and will continue to be blighted until the excessive government expansion policy is reversed or the application is turned down. It is not, therefore, a generous gesture from BAA.

Neither is it reasonable or fair. It applies only to the smaller number of those who will be affected within the average noise contour of 66 decibels. Bearing in mind the fact that the World Health Organisation (WHO) considers that to avoid annoyance you need to live outside the average 50 decibel contour, the offer is ridiculous.

It takes no note of air pollution (which should include the partly burned kerosine that falls from the sky) or of those residents who would be affected by the increased use of the original runway.

This scheme has nothing to do with the statutory compulsory purchase arrangements available to those whose house has to be knocked down if another runway is built. BAA have also introduced their version of this scheme. All affected residents are entitled to compensation irrespective of BAA's offers, though not unless and until a new runway is approved.

Pat Dale

Who has BAA got on board for plan?

Saffron Walden Reporter - 13 May 2004

SO Mr Francis (Postbag, April 29 "Public transport exempt from VAT") would prefer any second runway at Stansted to be built to the north?

While many question the need for any new runway at all it is ironic to note that, if BAA gets its way, there may be a third or even fourth - perhaps to the north?

He mentions the absence of fuel tax levy enjoyed by the air industry and points out that other public services like trains and buses are also exempt.

Yet railways, like airlines, are very much privately-owned concerns, albeit "public companies" in some cases.

While some may be dismayed that despite grants our rail service could be improved, one may travel on a low-cost airline for 1p to Spain, apparently.

I only wish I only had that to pay when travelling from Audley End to Liverpool Street, but I doubt I ever will, just as millions of drivers will continue to pay VAT on petrol until Domesday.

Yet some car drivers may be operating for the public good - hauliers certainly are, but they have to pay tax on diesel. Some are forced out of business by these overheads.

Why are these airlines able to operate on a shoestring and charge such absurdly low fares?

Perhaps it is because Stansted is being cross-subsidised by BAA using Heathrow and Gatwick and, to its chagrin, British Airways et al, with the knowledge of the Government?

Mr Francis reminds us Stansted will have to finance any development itself.

As Jacqueline Cooper (Postbag, April 22 "Like smashing the Mona Lisa") pointed out, BAA makes £50million a year from "commercial aspects", which include lucrative car parking, warehousing etc.

It is its intention to obtain a vastly augmented "safeguarded" area, larger than Heathrow, and pad it out with more car parks, shopping malls, roads and the new terminal and satellites to facilitate the new runway.

Then come the houses on irreplaceable green belt land.

As for creating work, it's all relative. It is not so much a case of providing work for local people per se as the creation of whole new communities emerging to, in time, absorb the existing ones.

One wonders how many long-haul operators will be attracted to Stansted when cross-subsidies ends in 2008.

I also fail to see how Mr Francis can prove that "air transport produces fewer local emissions than either cars or diesel trains per passenger kilometre".

This in the face of growing worldwide debates linking flying and global warming/climate change as a contributory factor.

How is it that people in Molehill Green have to remove layers of kerosene from their water butts?

One daren't think what it might be doing to poor Hatfield Forest and its lovely old trees, or to asthma sufferers. To say nothing of the impending noise.

This is why Stop Stansted Expansion fights so well to get the message across and it is winning the argument, despite the nebulous Stansted support group.

Why should BAA need this if it's all done and dusted, as people fear?

It is a myth BAA is invincible and that this madness is either necessary or inevitable.

JONATHAN HOWARTH
Saffron Walden

Airport's flights of fancy

Saffron Walden Reporter - 13 May 2004

WELCOME to the Alice in Wonderland world of BAA

Your story last week "Bid to increase runway limits" contains a statement from the planning director of BAA Stansted that with its planned increase from the present throughput of 20 million passengers a year to 35 million per year (a 75 per cent increase), "there will be less noise" because there will be no heavy long-haul aircraft.

On this basis may we soon expect Gordon Brown to announce a rise in basic income tax rates from 22 per cent to 40 per cent but that "we will actually be paying less tax", because there isn't going to be a 50 per cent tax rate?

Or a promoter of an all-night heavy metal concert in Audley End Park claiming that "actually it will be quieter" because the original plan was to have a week-long festival?

Or Cambridge United claiming that 16th position in Division Three entitles them to promotion to Division Two because they won a few more games than they were expecting to?

Still, at least we now know what BAA stands for: Bleedin' Amazin' Arithmetic.

C S BENNETT
Hadstock

Seeing the big picture

Saffron Walden Reporter - 13 May 2004

WITH reference to Ms Daw's letter of May 6, she thinks Stop Stansted Expansion is adpting a NIMBY attitude.

If she took the time or trouble to become acquainted with what SSE is doing, that is far from the truth.

SSE has frequently said not in anyone's backyard and that is why it has received support from Heathrow and other anti-airport expansion groups.

I have frequently read comments like the anti-lobby hates change, think of the wider picture, think jobs, freedom to fly and the car pollutes more than the plane etc.

Others have said airport expansion has been on the cards for years and the "moaning minnies" have only got themselves to blame for moving to this area.

Perhaps us "anti's" were a little foolish but I think that not in our wildest dreams could we believe that a "responsible" Government could sanction a monster like this for greed.

Whether you are for or against depends on what sort of person you are and where your values lie.

I can quite understand if you are "for" airport expansion if you think retail therapy is your God, you still have urban routes, you are a plane spotter and you are more than happy to support the ever-growing rodent population which feast on left-overs outside fast food outlets.

If you, like me, appreciate the finer things in life like our heritage, country pursuits, 16th century pubs and clean air, the thought of expansion is quite abhorrent.

T DAVIS
Clavering

FOOTNOTE: The Dunmow Broadcaster reports that the low cost Canadian airline ZOOM is going to start a fortnightly flight from Stansted to Vancouver - apparently they already run a service from Glasgow and Gatwick and will now give Stansted a try. This will be the second long haul airline to use Stansted. The first had to give up after the 9/11 terrorist attack when passenger bookings to America fell dramatically.

Pat Dale

A new report casts serious doubt on controversial government plans to increase airport capacity in London and the South-East.

It finds that six of the top 10 destinations from the capital could be better served by new high-speed rail links, which would be far less damaging to the environment.

It rejects fears that Heathrow's status as an international hub would be damaged without a third runway and calculates that only a third of air passengers contribute to London's economy - because other flights involve transfers or leisure trips by people living outside the South-East.

And, in a finding sure to be seized upon by anti-expansion campaigners, the report concludes: "The case for expansion of airports in the South-East has not been made."

The report comes from the London Sustainable Development Commission, set up by Mayor Ken Livingstone to promote green policies.

It follows the announcement by Transport Secretary Alistair Darling last year that a new runway is to be built at Stansted by 2012, with a third runway at Heathrow between 2012 and 2020 if "stringent environmental limits" can be met.

Mr Darling said extra capacity was needed to cope with an expected increase in demand for air travel two-and a-half times current levels by 2030. But Mr Livingstone said he opposed a new runway at Heathrow, preferring to see Stansted and Gatwick expand first - if at all.

He said: "The document questions the whole need for any increase in runway capacity by focusing on the pretty massive subsidies to allow people to be able to travel by air without the same tax burdens if they travel by rail."

"If the business community can demonstrate that not to build another runway at Heathrow would lead to decline, most probably the majority of Londoners would say that is something we have got to do. But the business community hasn't made that case."

The commission's report calls on the Government to recast its projections for growth in air travel - noting that demand would fall if fares rose with the removal of subsidies. It says there is "not a level playing field" with other forms of transport - no tax on aviation fuel, no VAT on air tickets and no VAT on consumer goods purchased at British airports. The industry also benefits from duty-free sales.

According to the researchers, up to six of the top 10 destinations from London - Amsterdam, Edinburgh, Glasgow, Paris, Manchester and possibly Frankfurt - could be served by high-speed rail rather than air.

This would remove 16.9 million passengers a year - 14 per cent - from London airports. The report said: "Rail can achieve a very high market share if services of appropriate quality and speed are offered." It also calls for improvements in the two London-Scotland rail lines. It finds that low-cost flights accounted for 85 per cent of the growth of passengers at London airports in the last five years, and calls for business and inbound tourist flights to be prioritised.

It says: "Only a third of flights are highly valuable to London's economy. If the costs of flying reflected external environmental costs and subsidies were removed, the growth in demand would be reduced."

John Stewart, of anti-expansion group HACAN ClearSkies, said the aviation industry benefited from ££9 billion in subsidies a year. "If we put some of that into high-speed rail it could give passengers a real choice."

Amid all the worries over global warming, there's one quick, though impractical, way to turn down the heat: ground all jets. That's one conclusion to be drawn from a new NASA study linking the world's rising temperatures to the proliferation of wispy cirrus clouds that can form as a result of trails of condensation left by airliners.

A team headed by Patrick Minnis, a senior scientist at NASA's Langley Research Center in Hampton, Virginia, analyzed 25 years of cirrus-cloud counts and 20 years of temperature records and found that cloud cover increased most where jet traffic was highest, including flight corridors over the Atlantic and Pacific Oceans.

Clouds, which reflect sunlight, ought to cool the earth. But they can also hold in warmth. That second effect swamps the first. According to Minnis' calculations, increased cloud cover since the 1970s ought to have led to a warming of 0.2^oC to 0.3^oC per decade. The actual warming during this period falls within that range, at just under 0.28^oC. That may not sound very much, but when only 5^oC separate our current temperature from the last ice age, it's clear that a little warming makes a big difference. "This study," says Minnis, "demonstrates that contrails should be included in climate-change scenarios."

The only way to prove that point is to keep the jets on the tarmac and see what happens. That's exactly what occurred in 2001, from Sept. 11 to 14, when U.S. air travel was shut down following the terrorist attacks. During that period, the swing between daytime highs and nighttime lows sometimes measured more that twice as much as usual, perhaps owing to a reduction in cirrus clouds that allowed collected solar heat to radiate away.

New and larger passenger planes may exacerbate the problem, but it is the frequency of flights that matters most. One way to tackle warming would be to have planes fly roughly 25% lower - altitudes less conducive to cirrus-cloud formation. But there's a catch: fuel consumption would go up if planes were forced to plow through thicker air.

OUR COMMENT:  DEPARTMENT FOR TRANSPORT - PLEASE TAKE NOTE

Pat Dale

The claims from Airbus about the new "super-jumbo" aircraft include, as David Gow and John Vidal report in their article "Bigger, greener and with space for a sauna - the A380", The Guardian 8th May 2004, the rather stunning statement that fuel consumption will be "comparable with the best small, modern turbo-diesel cars".

When describing their new aircraft on the company's website, www.airbus.com, Airbus say that "Indeed, the A380 will be the first long-haul aircraft to consume less than three litres of fuel per passenger over 100 kilometres (95 miles per imperial gallon)". Now I simply cannot find a current production car that comes anywhere near this claim. The best is a small Citroen that reaches 68.9 mpg for the combined urban/extra urban cycle and a Vauxhall that reaches 80.7 for the extra urban cycle, sourced from the Vehicle Certification Agency database. It seems that Airbus have been, and this is being charitable, somewhat selective in their use of comparison cars and mileage figures - just what is this wonderful small modern turbo-diesel car that does more than 95 mpg in everyday use? I'm sure every Guardian reader will want one!

Airbus also claim that the A380 will fly "without negatively impacting the environment thanks to significantly reduced noise and emissions levels". Well, Airbus say that with the latest Roll Royce Trent 900 engines, when the A380 flies over densely populated West London heading to land at Heathrow at night, its official noise output will be around 101 Effective Perceived Noise decibels. This will be similar to having a motorbike, petrol lawn mower or refuse truck passing overhead at intervals throughout the night. Those intervals could well be fewer, as one of the major design goals for the A380 has been to get its noise performance within the Heathrow limits, guaranteeing more night flights for its airline customers - and less sleep for the airport's neighbours.

And unless this aircraft is totally exhaust-free, its contribution to both atmospheric climate change and around-airport local air quality impacts will increase and make matters worse as this monster takes to the skies. An environmentally benign 555-seat aircraft? Back to the drawing board, Airbus.

EasyJet this week unsettled the stock market by warning of intense price pressure generated by more than 50 low-cost airlines operating in Europe. EasyJet's announcement followed similar gloom from Michael O'Leary, chief executive of Ryanair, who said that many of the recent start-ups would fail but that, in the meantime, next winter would be "awful" for the airlines because of Europe's fare wars.

What is awful for the airlines is not, of course, awful for their passengers, many of whom are finally benefiting from the lower fares promised by the deregulation of Europe's aviation market in 1997. But travellers should enjoy the cheap flights while they can. While fares are unlikely to return to their pre-deregulation levels, the eye-catchingly low special offers cannot stay that way forever.

The low-cost airline shake-out promised by Mr O'Leary will almost certainly happen. Europe is set to follow the pattern set by the US when its airline market was deregulated in 1978. Asia, just beginning its own aviation deregulation, should observe closely.

In the US, many low-fare airlines set up shop, but few have survived. The most successful of them all, Southwest Airlines, the model for no-frills carriers everywhere, has been joined by a handful of others. JetBlue and AirTran, which was known as Valujet until an air crash in the Florida Everglades in 1996 almost destroyed its business and forced it into a change of name. Europe's low-fares sector is less mature. Many would say the same of Mr O'Leary, who is much given to fruity language when talking about travel agents or customers who demand refunds. Nevertheless, Ryanair is expected by most analysts to be among the low-cost survivors, as is EasyJet. Most of the remaining 50 are expected to disappear. Duo, a UK based operator collapsed at the weekend.

Aviation is a difficult industry in which to survive. The low-cost airlines avoid many of the problems of the full-service carriers. They have less restrictive working practices and can demand greater productivity from their crews, with more flights each day and less time hanging around at airports. Fixed costs are high, margins are slim and price wars can easily force poorly capitalised airlines into bankruptcy. Nor, as Valujet showed, can airlines compromise on safety.

Not that life is much easier for the big carriers, as demonstrated by the Italian Government's unveiling yesterday of yet another plan to stop Alitalia from going under. The US airlines have yet to emerge from their worst period since commercial flight began.

Why do people start new airlines ? "Maybe its sex appeal, but there's something about an airplane that drives investors crazy", Alfred Kahn, architect of American airline deregulation, once observed. Warren Buffett jokes that there is a helpline he calls if he is ever tempted to buy airline shares. Potential investors should ask him for the number.

OUR COMMENT: Those thinking of investing in the expansion of the home airport of low-cost airlines, namely Stansted, should also consult this helpline!

Pat Dale

Amid razzmatazz and Europop, the world's largest aircraft was unveiled yesterday at Europe's biggest factory, a purpose built assembly line in Toulouse. The Airbus A380 will have 50% more floor space than arch rival Boeing's 747 Jumbo, with room for duty free shops, restaurants and even a sauna – it is forecast to revolutionise international air travel.

The company also claims it will cost 17% less per seat than the 747, burn considerably less fuel, alleviate congestion in the skies and at airports and meet stringent new controls on noise and other forms of environmental pollution – but green campaigners argue it will cause more noise and pollution.

Opening the assembly line in the Jean Luc Lagardere plant in front of 3000 guests, Jean Pierre Raffarin, the French Prime Minister, hailed the joint European venture aircraft a celebration of "our new Europe". He praised Airbus for "making an extraordinary step towards the challenge of the new epoch".

In a stunning coup de theatre, coloured veils fastened to the ceiling of the building parted to reveal hundreds of the tens of thousands of A380 workers and, then again, the show the nose and fuselage of the huge new plane.

The rows of clapping employees included staff from Broughton, north Wales, who make the giant wings, and Filton, Bristol, who make the landing gear. Airbus, in which Bae Systems holds a 20% stake, employs 12,000 in the UK.

Executives said the A380, which cost between £140m and £157m each compared with the £84 for Boeing's new Dreamliner jet, would create 26,000 jobs in Britain and sustain a further 100,000 among suppliers. It is being built at 16 Airbus factories in Germany, France and Spain as well as in the UK.

The report goes on to describe how the parts are brought to the huge factory by ship and boat up the Garonne river as far as possible. At the moment there are difficulties in bringing the wings from Wales down the river Dee as the Environment Agency do not want the river to be dredged as deeply as the company considers necessary. The wings are too large to travel by road.

The report continues: Activists in Britain warned of more noise and pollution from the superjumbo. "There's some truth in the Big is Beautiful argument. The plane will use less fuel per passenger and be cheaper, but this will only encourage more people to fly further" said Nic Ferriday a spokesman for Airport Watch. "The impacts could be felt by communities living near airports. Big planes inevitably cause more noise and pollution than small ones, but the superjumbo may also mean that airports have to expand to cope. They may need bigger terminals and satellites".

Airbus's US rival, Boeing, believes there will not be a great demand for huge aircraft over the next decade and has put its faith in a new much smaller 7E7 Dreamliner. But Airbus is pinning its hopes on the 'big is beautiful" theory, leading to a US-European battle for dominance of the skies.

The report finishes with the information that Airbus claims that it already has 129 firm orders for the plane and hopes to sell 750 in the next 20 years.

OUR COMMENT: Airbus claims that fuel burn will be about 13% less than its closest rival. It will generate half the noise produced by competitors at take-off. It will carry up to 800 passengers with a range of 9,300 miles.

These figures mean very little unless we know what the performance of "the competitor" is. Neither will we know the true position until the actual plane undergoes its tests when CO2, NO emissions and noise produced will be accurately measured. In addition, comparisons will then have to be made between the environmental effects of possibly 2 or 3 flights by a smaller plane v. one trip by this superjumbo. We have to remember that predictions on climate change suggest that CO2 engine emissions will need to be reduced by as much as 50% as well as NO2 for local air quality, not forgetting noise.

It is, however, an advance in design. In the original SERAS predictions it was assumed that long haul planes might appear at Stansted if it expanded but in the White Paper the decision was taken to include only the new Boeing 7E7 in the predicted fleet and no larger long haul aircraft. So, no account has been taken of the greener claims of this new giant as far as Stansted is concerned.

Pat Dale

Industry targets for carbon dioxide emissions were lowered by the government yesterday in response to concerns from businesses.

The decision to relax the national allocation plan drew criticism from environmental groups which said it undermined the government's commitment to tackling climate change.

But some industrialists also complained, saying the government had not gone far enough to address their concerns about competitiveness.

The decision to make more generous allowances to industry in the first phase of the EU's emissions trading scheme puts the UK on course to cut CO2 emissions by 15.2% between 1990 and 2010. An earlier draft plan set the target at 16.3%.

The report follows on with quotes from both sides including pessimistic forecasts about an increase in electricity prices from the Energy Intensive Users Group and from Friends of the Earth who dismissed the original intention of the government to reduce CO2 emissions by 20% by 2020 as "a distant dream".

OUR COMMENT: We continue to ask why air travel remains the favoured beneficiary not only of financial subsidies but is also excused from making any contribution to preventing climate change? Surely industry as a whole is more important than catering for the presumed wish of would be tourists to have more than one foreign holiday a year? It could even be expressed as "pay more for your electricity but get it back on your air fare". This policy is not helpful either to preventing climate change or to the cost of living. Energy charges should be made, for the future benefit of all of us but it should be fairly spread across the whole community. The government should be pressing for aviation to be included in the EU emissions scheme and should consider a U Turn on airport expansion policies.

The latest move - the government is asking all airport operators to revise their airport plans (AMPs) this year and to take into account the plans in the White Paper. Regional planners are asked to take account of AMPs when they are revised. This makes nonsense of their claim that the White Paper is only an enabling Plan and it is up to the airport operators and local Planning Authorities to reach a decision locally. It is pre-empting the Planning system without any legislative backing. Regional Plans should not be required to include plans for the future that are as yet unformulated and unapproved. The government may have the ultimate say on any planning application but a lot of water has to pass under the Stansted planning bridge before anything is finalised.

Pat Dale

CLIMATE MOVIE SPARKS SPOOF NET CAMPAIGN

Environmental campaigners have taken up a challenge from the producers of the upcoming blockbuster The Day After Tomorrow, by launching a new website.

www.thedayaftertomorrow.org is a spoof on the dot com website of the same name. The movie, to be launched on 28 May, recounts a fictional disaster in which climate change brings about a new ice age. The producers have stated that campaigners should take advantage of the film.

The parody website, launched today by Greenpeace, has the same look and feel as the official site for The Day after Tomorrow. It will roll out in at least six countries and four languages. But the Greenpeace site lays the blame for climate change squarely at the feet of the U.S. administration and oil company Esso by asking the question: "The Day After Tomorrow - Who will you blame"?

"Millions of people will see this film and want to do something about the growing menace of global warming. When they visit our site, they'll learn about the real life disaster of climate change - currently being directed by Esso and produced by George W Bush", said Rob Gueterbock of Greenpeace. "This movie may be fiction, but climate change is real and we know who the bad guys are".

Visitors to the site can see Greenpeace's own movie trailer, which features real impacts of climate change (special effects), a factual update on the science and a chance to re-write the ending by taking action.

Greenpeace is also launching a massive subvertising campaign. More than a million movie-style stickers are now in the hands of activists across the UK, ready to let the public know who's to blame for global warming. The environmentalists' campaign comes as the Bush administration attempts to stifle the film's message. The New York Times recently published an internal administration memo showing how NASA scientists were ordered not to comment on the film. NASA later rescinded the order, after scientists protested.

The U.S. refuses to sign up to the only international treaty on global warming, the Kyoto Protocol, with President Bush's policies largely focussing on research with no real cuts in C02. Most American scientists are clear that global warming is happening and is caused by humans. Esso, the world's richest company, also refuses to accept the scientific consensus. The company pays front groups to block action and invests nothing in clean, renewable energy.

Stansted leads way with training ground

STANSTED Airport now boasts the country's most advanced airport training ground

Chief executive of BAA Mike Clasper yesterday unveiled the £4.6 million facility which took just over a year to build and houses a mass of high-tech computer and gas equipment underground.

The training ground enables firefighters to deal with a range of incidents from external fuel spillage to a blaze in a toilet, overhead cabin or baggage hold. Liquid petroleum gas is used instead of kerosene to make training more environmentally friendly.

Assistant divisional fire officer Tom Murney said "From a training point of view you cannot beat the real thing and this training ground enables us to replicate what could happen." Stansted airport fire station has eight appliances and 60 firefighters who will each use the training ground at least once a month.

OUR COMMENT: Congratulations to BAA!

Plans for Expansion

It was revealed on 5th May that Stansted Airport will submit a planning application within the next 12 months for permission to go from 25 to 35 million passengers a year.

It is just over a year since the airport was granted planning permission by Uttlesford District Council to increase from 15 to 25 million passengers.

Current trends, which have seen Stansted become a lead player in the low fares market, mean the airport is likely to reach 25 million during 2006 rather than the original predicted date of 2010.

Chris Butler, business development and planning director outlined the next steps at a meeting of Stansted Airport Consultative Committee. He said: "It is clear that we should move forward now and I want to confirm to you that it is our aim to submit a planning application within the next 12 months for permission to go beyond the current capacity limit of 25 million passengers per annum. Subject to the outcomes of the appropriate effect studies we will be seeking to increase capacity to around 35 million."

The company which designed the Eden Project in Cornwall has been named as architects for the new terminal and other buildings at Stansted Airport. Architect firm Grimshaw, which also designed the Euro star train terminal at Waterloo station in London, has been appointed by airport operator BAA to begin design work at Stansted.

OUR COMMENT: No congratulations for this news. Note: Architects have been engaged for the new terminal. Is this for the extra runway? We have been assured in a recent letter from BAA that the first application for an increase in passenger numbers to 35 mppa would not require any increase in terminal accommodation.

Pat Dale

European Airlines faced mounting turmoil yesterday as EasyJet shares fell by 25% in response to intensifying fare wars and mounting competition from a host of new low-cost carriers, and Alitalia shares were suspended in Italy.

Ray Webster, chief executive of EasyJet, one of the two leading European low-cost airlines, said: "We are seeing unprofitable and unrealistic pricing by airlines across all sectors of the European industry, seeking to grow or maintain their market share". He said growing competitive pressure could undermine the group's performance in the second half of the year, when it traditionally generates all its profits.

In Italy shares in Alitalia, the Italian majority state-owned flag carrier, were suspended before an expected board meeting today as the group held talks with the government and trade unions to avert bankruptcy and mounting losses.

Several small scheduled and charter airlines have collapsed in France, Germany and Belgium in recent months. Duo, launched last year at Birmingham and Edinburgh airports, became the latest casualty in the European aviation industry at the weekend when it collapsed, leaving more than 1000 passengers stranded with the immediate loss of 260 jobs.

Last week Michael O'Leary, Ryanair chief executive, said that the next winter season would be "awful" in the European airline sector amid continuing fare wars and a shake-out among the many recent start-up low-cost airlines.

The report goes on to describe how more new low-cost airlines are still being launched, notably in the countries who have just joined the EU, attracted by the profit margins achieved by the leaders Ryanair and EasyJet. It closes with further details about the position of EasyJet.

In further comments in the Financial Times, the "Observer" and in the Companies and Markets section, it is suggested that the stock market's reaction to EasyJet's news was an over-reaction, and that the financial situation would right itself later in the year. It is also suggested that seat prices would continue to fall!

Low cost carrier EasyJet sent its share price into a tailspin yesterday after it warned it was suffering from the impact of fierce competition from full service airlines and budget start-ups. Its market value plummeted by a quarter after the company revised its full-year outlook from "cautiously optimistic" in February to "cautious".

Chief executive Ray Webster said: "We are seeing unprofitable and unrealistic pricing by airlines across all sectors, seeking to grow or maintain their market share."

The report goes on to record that passenger numbers were up by 14% to almost 1.95 million, but fares were down 5% - in part because of timing differences between Easter and May bank holidays.

Mr Webster's more optimistic forecasts are then detailed with predictions of further expansion and the company's ability to see off competition. There are now 50 low-cost carriers in Europe and there is no possibility of them being able to follow Ryanair and EasyJet's rapid expansion. Mr Webster considered that those past rates of growth are not possible now. He pointed out that "there are now 38m low-cost seats available in London, excluding Heathrow. London's a big city but that's mind boggling". He continued, saying that the Stansted market was particularly out of balance, but EasyJet had a wide-spread route network which gave it a "very distributive income stream".

OUR COMMENT: What are BAA's views? Is Stansted "out of balance"? Is BAA taking note of these dangers when it costs its plans for another runway? Are BAA's possible backers taking note?

No-one wishes to see a well run airline get into financial difficulties, especially when they provide a full report on the situation and a warning as to what damage overkill in the cheap fares market can do. It has surely been clear that there is a limit to the ability of any airline or any other form of transport to lower their fares and at the same time to provide fully maintained aircraft serviced by staff who are well qualified and have good standards of pay and working conditions. It is also important that the costs of environmental damage are reduced as much as possible and paid for.

Can ever cheaper air fares be compatible not only with air safety but also with the urgent need for airlines to invest in greener aircraft, which will probably cost more since they will involve new engine and frame designs.

The government needs to get its head out of the sand and not encourage this dangerous competition by helping to provide ever increasing airport space. It should drop the policy of expansion and introduce that environmental charge that was promised - if it were an emissions charge then the best airlines would benefit.

Pat Dale

Low-cost airlines, including Ryanair, yesterday launched a legal challenge to new European Union regulations that could force them to pay out hundreds of Euros in compensation i