ACCHANGE
12.47
From 2013 to 2015
Since the 1970s, the number of passengers and flights in Europe has increased dramatically. This increase led to capacity problems in the air and in airports, resulting in delays and additional costs for airlines and passengers. Therefore, the European Commission (supported by Eurocontrol) undertook several initiatives, including the Single European Sky (SES). However, to date, the results of the SES initiatives have not met expectations.
Within the ACCHANGE project, we investigated whether vertical integration of air navigation service providers (ANSPs), airports, and airlines in a regional context could facilitate a change - driven from the industry itself - while EU regulation promotes the standardisation process. This approach differs from current ideas on SESAR deployment, which are more focused on centrally driven and synchronised implementation. In contrast, ACCHANGE proposes a behavioural solution to accelerate the introduction of new technologies. The focus is on changing air traffic control (ATC) incentives. We developed and used several models to examine the effects of policy changes.
The ACCHANGE project first analysed current developments in ATC and in the aviation sector in Europe (Deliverable 2). We compared these with developments in other sectors (Deliverable 1). We focused on institutional factors, such as cost efficiency, technological innovation, and regulation, as well as the factors that hinder change within ATC. We first developed a set of scenarios (Deliverable 3) and then developed four different models to analyse possible paths for change within ATC: a network congestion game, a trade union model, an economic efficiency model, and a simple economic network model (Deliverable 4). The first model focuses more on estimating the effects of particular scenarios, the other models on explaining the current inefficiencies within ATC and its regulation.
The added value of the four theoretical models developed lies in the fact that they comprehensively demonstrate that price regulation remains the cornerstone for change, but that this alone is insufficient to ensure change. Instead of focusing only on cost efficiency, it is better to also consider monetary compensation for other performance indicators (delays, technology adoption, environmental objectives, and safety). Price regulation could then take the form of a hybrid price cap. Alternative incentives for change within the aviation sector will have very little effect due to the low elasticity of demand. This was demonstrated in the network model. The ACCHANGE project concluded that it is necessary to change institutional and regulatory mechanisms to encourage greater cost efficiency and accelerated technological adoption simultaneously.
The study also suggests that introducing some competitive elements can help drive change from the bottom up. This is a different approach from the usual collaborative approaches to developments within ATC. In this context, regional precursor or vertical collaboration is the way forward, as it provides greater competition and incentives for higher cost efficiency and for the adoption of capacity-enhancing technological options. A more radical approach is to franchise air navigation services to a private company for a predetermined period using regular tenders. This could further boost the SES approach.
TML was project coordinator of the ACCHANGE project and was responsible for the comparison with other sectors, developing three of the four models and drafting the conclusions.
Within the ACCHANGE project, we investigated whether vertical integration of air navigation service providers (ANSPs), airports, and airlines in a regional context could facilitate a change - driven from the industry itself - while EU regulation promotes the standardisation process. This approach differs from current ideas on SESAR deployment, which are more focused on centrally driven and synchronised implementation. In contrast, ACCHANGE proposes a behavioural solution to accelerate the introduction of new technologies. The focus is on changing air traffic control (ATC) incentives. We developed and used several models to examine the effects of policy changes.
The ACCHANGE project first analysed current developments in ATC and in the aviation sector in Europe (Deliverable 2). We compared these with developments in other sectors (Deliverable 1). We focused on institutional factors, such as cost efficiency, technological innovation, and regulation, as well as the factors that hinder change within ATC. We first developed a set of scenarios (Deliverable 3) and then developed four different models to analyse possible paths for change within ATC: a network congestion game, a trade union model, an economic efficiency model, and a simple economic network model (Deliverable 4). The first model focuses more on estimating the effects of particular scenarios, the other models on explaining the current inefficiencies within ATC and its regulation.
The added value of the four theoretical models developed lies in the fact that they comprehensively demonstrate that price regulation remains the cornerstone for change, but that this alone is insufficient to ensure change. Instead of focusing only on cost efficiency, it is better to also consider monetary compensation for other performance indicators (delays, technology adoption, environmental objectives, and safety). Price regulation could then take the form of a hybrid price cap. Alternative incentives for change within the aviation sector will have very little effect due to the low elasticity of demand. This was demonstrated in the network model. The ACCHANGE project concluded that it is necessary to change institutional and regulatory mechanisms to encourage greater cost efficiency and accelerated technological adoption simultaneously.
The study also suggests that introducing some competitive elements can help drive change from the bottom up. This is a different approach from the usual collaborative approaches to developments within ATC. In this context, regional precursor or vertical collaboration is the way forward, as it provides greater competition and incentives for higher cost efficiency and for the adoption of capacity-enhancing technological options. A more radical approach is to franchise air navigation services to a private company for a predetermined period using regular tenders. This could further boost the SES approach.
TML was project coordinator of the ACCHANGE project and was responsible for the comparison with other sectors, developing three of the four models and drafting the conclusions.
