Congestion Pricing - Airports

Airports

Many airports are facing extreme congestion, runway capacity being the scarcest resource. Congestion pricing schemes have been proposed to mitigate this problem, including slot auctions, such as with the Panama Canal, but implementation has been piecemeal. The first scheme was started in 1968 when higher landing fees for peak-hour use by aircraft with 25 seats or less at Newark, Kennedy, and LaGuardia airports in New York City. As a result of the higher charges, general aviation activity during peak periods decreased by 30%. These fees were applied until deregulation of the industry, but higher fees for general aviation were kept to discourage this type of operations at New York's busiest airports. In 1988 a higher landing fee for smaller aircraft at Boston's Logan Airport was adopted; with much of the general aviation abandoned Logan for secondary airports. In both US cases the pricing scheme was challenged in court. In the case of Boston, the judge ruled in favor of general aviation users due to lack of alternative airports. In the case of New York, the judge dismissed the case because "the fee was a justified means of relieving congestion".

Congestion pricing has also been implemented for scheduled airline services. The British Airports Authority (BAA) has been a pioneer in implementing congestion pricing for all types of commercial aviation. In 1972 implemented the first peak pricing policy, with surcharges varying depending on the season and time of the day, and by 1976 raised these peak charges. London-Heathrow had seven pricing structures between 1976 and 1984. In this case it was the US carriers that went to international arbitration in 1988 and won their case.

In 1991, the Athens Airport charged a 25% higher landing fee for those aircraft arriving between 11:00 and 17:00 during the high tourism season during summer. Hong Kong charges an additional flat fee to the basic weight charge. In 1991–92 peak pricing at London's main airports Heathrow, Gatwick and Stansted was implemented; airlines were charged different landing fees for peak and off-peak operations depending on the weight of aircraft. For example, in the case of a Boeing 757, the peak landing fee was about 2.5 times higher than the off-peak fee in all three airports. For a Boeing 747 the differential was even higher, as the old 747 carries a higher noise charge. Though related to runway congestion, the main objective of these peak charges at the major British airports was to raise revenue for investment.