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Heathrow Airport to recoup runway planning costs

Aviation regulator allows airport to charge airlines more to recover £320m spent on third runway early design.

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Heathrow Airport has been permitted to increase charges to airlines to recoup £320 million spent on the initial stages of its third runway project. The aviation regulator confirmed the decision, which is expected to add 15 pence to the cost of a passenger ticket in 2028, with a further increase to 30 pence in subsequent years.

The costs being recovered are specifically for early planning and design work conducted in 2025 and 2026. The Civil Aviation Authority (CAA) and Heathrow Airport have stated that measures will be implemented to safeguard consumers from unjustified price hikes.

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Rival bidder costs also covered

Arora Group's Heathrow West, a bidder that proposed an alternative shorter runway design, will also recover £4.1 million in costs. Heathrow Airport will collect these expenses by adding them to its airport charges.

The CAA had previously proposed capping Heathrow's airline fees between £27.20 and £30.50 per passenger for the period of 2027 to 2031. Tim Johnson, the CAA's director of consumers and markets, informed the BBC that the regulator has approved the recovery of this initial tranche of costs, up to a maximum of £320 million.

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Johnson stated that the decision balances the need to support Heathrow expansion for consumer benefits with protecting passengers from excessive cost increases. The regulator's safeguards include transparency and cost reporting requirements, along with independent expert assurance.

The potential cost impact on ticket prices from the actual construction of a third runway remains unclear at this stage. The government announced in November its preference for Heathrow's £33 billion scheme over Arora's alternative, citing it as the most deliverable option with the highest likelihood of a planning decision within the current parliamentary term.

Heathrow Airport, in response, stated that a third runway would make travel more affordable, offer greater choice, and provide a significant economic boost across the country. The airport is currently reviewing the CAA's proposals before making investment decisions.

Plans for a third runway at Heathrow have been discussed for decades, with government backing dating back to 2003. However, the proposal has faced opposition from climate campaigners, local residents, and politicians concerned about increased air and noise pollution, and potential breaches of climate commitments.

Questions this report answers

+How much will Heathrow charge airlines to recover the runway planning costs?

Heathrow Airport will charge airlines up to £320 million to recover costs spent on early planning and design of the third runway between 2025 and 2026. This amount is part of the airport’s overall charges and will be collected from airlines operating at Heathrow.

+How will this affect ticket prices for passengers?

The additional costs will add 15 pence to passenger ticket prices in 2028, rising to 30 pence in later years. These increases are expected as Heathrow recovers the planning expenses through higher airport charges.

+What safeguards are in place to protect passengers from excessive price hikes?

The Civil Aviation Authority (CAA) has introduced safeguards including transparency, cost reporting requirements, and independent expert assurance. These measures aim to ensure that any price increases are justified and do not unfairly burden consumers.

+Will the costs for rival runway proposals also be recovered?

Yes, Arora Group’s Heathrow West proposal will recover £4.1 million in costs through Heathrow Airport’s charges. This covers the expenses incurred by the rival bidder for their alternative runway design.

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Heathrow to charge airlines £320m for runway planning | Harrow News London