Business Cases and Cost Benefit Analyses
Why the need for a Cost Benefit Analysis?
In the ATM world, we are often confronted with projects that involve huge initial , that require investment by different actors and whose benefits occur in different years or simply are only reachable in the long term.
This makes difficult to weigh the costs against the benefits of the initiative. Consequently, a serious analysis must be performed in order to minimize the inherent risks associated to any investment decision.
Be it a new radar system for a small airport or a new operational procedure affecting the whole Pan-European Network, a CBA provides the relevant information we need to take an investment decision.
What the team does?
At EUROCONTROL, there is a dedicated team of experts helping stakeholders consider the best available facts in order to choose among alternative solutions. For more than 15 years, EUROCONTROL has been aiming at giving ATM decision makers the relevant information needed in order to take well-reasoned investment decisions in the long term.
The Team is very active when it comes to collaborating with stakeholders:
- Key players in the ATM domain such as ANSPs, Airspace Users, Airports and the Military are involved in the different studies performed.
- The team is an active contributor in the definition of the Business Case maintenance of the SESARJU.
- We give equally support to the Single Sky initiative.
- Finally, the team is increasingly collaborating with other international organisations in the aviation sector like ICAO, EASA and the FAA.
EMOSIA, EUROCONTROL's Cost Benefit Analysis methodology, has been developed together with our stakeholders in the ATM domain.
Take a more detailed look at what we do and the different areas we are involved by clicking the tabs below:
ATM Master Plan
We worked with the SESAR partners to select Essential Operational Changes for the next wave of SESAR deployment, beyond Pilot Common Projects.
You can find the preliminary cost-benefit analysis of these changes in Chapter 6 of the latest edition of the Master Plan, Edition 2015 on the ATM Master Plan Portal.
Given the costs that many stakeholders will incur to implement SESAR new operational concepts and infrastructures, Business Cases are gaining increasing importance within the SESAR programme. As a decision support management tool, they can provide substantional evidence to decision-makers for investment decisions.
The EUROCONTROL Business Case Team is leading SESAR Project 16.06.06 - Business case maintenance, support and coordination. In cooperation with partners and the SESAR Joint Undertaking, the Team delivers and maintains business cases on SESAR key improvements, including Cost-Benefit Analysis (CBAs). Project 16.06.06 also provides common methods and guidance.
Our role in SESAR:
- We work together with the SESAR Joint Undertaking partners to provide Cost Benefit Analyses and Business Cases for key improvements and deployment packages.
- We build Business Cases through the integration of inputs not only from Cost Benefit Analyses but also inputs from safety, security, environment, human performance and other areas such as capacity and quality of service, deployment or finance.
- We support projects in specific cost and benefit assessments.
- We provide common Cost and Benefit Analyses and Business Case methods for application across the work programme.
You can find the latest Business Cases and cost benefit deliverables prepared in the framework of SESAR under the SESAR Joint Undertaking extranet: Project 16.06.06. (log in and password required). The guidance material is also available in our Publications page.
At EUROCONTROL, we see Centralised Services as a necessary step forward to reduce ATM fragmentation in Europe. At the Business Cases Team, we are working to provide credible and consistent Cost Benefit Analyses for each of the 9 Centralised Services proposed. We use EMOSIA: EUROCONTROL's methodology for Cost Benefit Analyses.
For the moment, we are improving our estimates as new data are available. Our initial findings prove that the savings to be achieved are in the order of EUR 150-200 Million per year. You can have a good summary on the article on EUROCONTROL's Skyway magazine, or watch the following video.
Single European Sky
The Business Case Team provides ad-hoc support to assess the economic impact of new ATM regulations in the scope of the Single European Sky. You can see examples of these impact assessments in the final reports of completed mandates.