The economic benefits of expansion at Heathrow

Chancellor Rachel Reeves’ announcement today cited Frontier’s most recent study for Heathrow exploring the economic benefits of a third runway. 

Heathrow currently has two runways and is limited to 480,000 flights per annum. It has been operating at full capacity for over 20 years. With Heathrow full (and with other airports forecast to also become capacity constrained in the coming years), the Department for Transport (DfT) forecasts that as many as 100 million passengers per annum in the UK may not able to fly by 2050. 

Heathrow has been exploring different expansion capacity growth scenarios. 

Frontier was commissioned by Heathrow to consider the overall net benefits of the different expansion scenarios, analysing the various consumer, social, environmental, and wider economic impacts of capacity growth at Heathrow. 

Capacity constraints come at a cost: connectivity is not as strong as it could be; passengers who continue to fly end up needing to pay more to do so; and many passengers are essentially priced out of flying, leading to missed social and economic benefits. But at the same time there are also environmental costs, and expansion must be consistent with the UK’s commitment to achieving Net Zero by 2050 as well as legally binding noise and local air pollution standards. Frontier’s analysis found that expansion would lead to a positive net benefit for the UK, in line with similar analyses carried out by the Airports Commission (2015) and the DfT (2017).

Click here to read the report Heathrow expansion benefits

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