Summary:

The Master Plan does not convince us of the need for airport expansion. In summary the economic analysis of the potential benefits and costs of this expansion to the local economy is flawed. The report misses a number of crucial factors and does not consider adequately how such a heavily subsidised sector of the economy will deliver economic benefit when such subsidies cannot be guaranteed in the future. There is also a failure to discuss the implications of 'peak oil' and how demand for oil will increasingly outstrip oil supply over the coming years; in short airfare prices will rocket and demand for flights will plummet.

Climate change is the greatest environmental and indeed economic challenge facing the world. There is a total lack of recognition of the enormous environmental impacts airport expansion will have on climate change and human health. The report downplays any need for aviation to cut emissions and the role expansion will have on degrading the local environment, in terms of noise, visual amenity and traffic congestion. This expansion runs counter to any long term view of economics or sustainability.

Finally there is a lack of any objective analysis of how expansion compares with more sustainable ways of improving the local economy and environment, and with alternative means of transport provision.

Comments relating to the Master Plan in more depth:

1. Forecasts of growth in aviation

The Master Plan notes: "the growth in the popularity and importance of air travel is expected to continue over the next 30 years (chapter 5). Various figures are given for the expected growth, but there is no analysis made of the wider economic factors.

Much of the current aviation growth is not based on ‘need’ but artificially inflated demand: the five-fold growth of passenger movements in the past ten years is the result of an artificial and unsustainable bubble brought about by discounted fares from budget airlines. The aviation industry has benefited from vast subsidies in the form of tax exemption on fuel and total exemption from the need to contribute to local infrastructure, public transport etc (see 2 below). There is no acknowledgment of the situation regarding 'peak oil' (see 2.e).

One further factor is that, as public concern about climate change grows, and as people become increasingly aware of aviation's contribution to this and other problems, more people will seek alternatives: the demand for air travel will fall.

2. Economic and Social considerations

We acknowledge the airport is a significant employer in the region and has some inbound tourism. However again a wider analysis in the Master Plan is missing.

(a) Bad for regional economy

The recent Friends of the Earth report, "Why airport expansion is bad for regional economies" makes a strong case that needs answering (i). This is all the more so when previous research like that by the Airport Council International focuses on what might come into the country. Similarly the Master Plan quotes Roger Tym and Partners have "considered the impacts on the regional economy from overseas visitors using BIA."

What might leave the country is also crucial.

The UK already runs a massive economic deficit from air travel. Foreign visitors arriving by air spent nearly £11 billion in the UK in 2004 but UK residents flying out spent £26 million abroad: a loss to the UK economy of £15 billion.

The Master Plan acknowledges that tourism will make up 80% of passenger numbers, and that those leaving the UK will out number those arriving here by many times. Domestic spending already accounts for 83% of tourism spending: if more people travel abroad then the amount they spend here will reduce. As the analysis in the Friends of the Earth report shows when these factors and others are taken into account then airport expansions will lead to economic drain not economic boom.

In addition to people traveling abroad spending more money,fewer tourists visiting the Uk there is also the growing factor that more flights by local residents to second homes abroad will be bad news for local shops and businesses.

The FoE report estimates that airport expansions in the South West will lead to a massive £30 billion currency outflow between 2004 and 2020.

(b) Aviation subsidies

The aviation industry enjoys a privileged tax-free status through duty free on flights outside the EU and exemption from tax on aviation fuel and VAT. These exemptions add up to about £10 billion per year for the UK alone of which less than £1 billion is recovered through Air Passenger Duty. The Master Plan fails to take into account this when they consider the economic and employment benefits of the airport. Instead of subsidising air travel this money could be used to provide better public transport or public services like schools and hospitals.

The expansion of the airport will be heavily dependent on public subsidy, through the provision of infrastructure to serve the airport, and through many tax incentives (like those mentioned) that give unfair advantage to aviation over other more sustainable transport providers. It would not make sense to base plans on expansion on the unsustainable use of these incentives, which will certainly be removed within the lifetime of these proposals.

(c) Employment

The UK aviation industry as a whole directly employs about 200,000 people. However given the subsidies noted above this translates into a subsidy of around £45,000 per year, per job! This does not appear to have been considered in any assessment of the job creation effects of the airport.

The low-cost airline business model driving much of the current growth requires minimisation of employment through adopting practices like web-based booking. Therefore the airport’s previous job growth forecasts have turned out to be over optimistic. This can be demonstrated by comparing recent employment forecasts with the actual position of employment now.

If job creation is one of the Plan's objectives, we would argue that more sustainable sectors of the economy could provide far greater numbers of jobs that would be more secure than could be envisaged by expanding the airport. There is no public policy justification for prioritising airport expansion over more environmentally sustainable job creation.

(d) Reliance on low cost airlines and tourism

The Master Plan acknowledges that the airport will become more dependent on low cost airlines and tourism. It does not make sense to rely on a sector which relies on its ability to cut costs, including relocating to areas of lower cost. Many examples of this have already happened at other regional airports in the UK. A more secure and sustainable plan would be for the airport to become more reliant on transport providers who are based within the local economy.

(e) Hidden subsidies

Of all European Union countries, the UK is the worst offender when it comes to passing the hidden costs of aviation on to society as a whole. The UK generates over a quarter of the European Union's hidden aviation costs that include health costs and the costs of climate change.

The overall hidden economic costs of the European Union's aviation sector are currently estimated at £14.7 billion a year - of which the UK alone accounts for £3.767 billion, or 26% (ii). This doesn't include the costs of aviation accidents, accident services, and direct subsidies like the £500 million given to BAe to help it develop a new airbus. Hidden subsidies to the aviation sector also include the costs of building and maintaining the surface transport infrastructure which serves airports - costs which are growing fast in parallel with the growth of aviation.

Even the Royal Commission on Environmental Pollution 18th Report, Transport and the Environment', October 1994 said: "...the demand for air transport might not be growing at the present rate if airlines and their customers had to face the costs of the damage they are causing to the environment."

Other aspects of the environmental impact of airport expansions will be discussed more later in this report.

(f) Fuel prices and realities of 'peak oil'

In the last year, the price of jet fuel has risen again by between 40% and 50%. The airlines have tried to absorb this price hike, keeping fares low and hoping for the best: worldwide some have posted massive losses, some are reported to be close to bankruptcy. No doubt fuel prices will stabilise again in the short term - and may even come down - but the reality is that this is a taste of the future: a taste of the effects of 'peak oil'.

Peak Oil in a nutshell is the moment in history when our global oil supply can no longer keep pace with demand. In other words all the easy-to-get at oil is extracted first, then the slightly harder-to-get-at oil, then a variety of methods are used to get the harder-still-to-get-at-oil and then, finally, when you are spending as much energy getting the remaining oil out as the energy embedded in that oil itself, you just give up and leave it there. There is simply no point in trying to remove the remainder.

When will this happen? The best estimates by oil companies and scientists are sometime between 2002 and 2012.

James May, CEO of the Air Transport Association writing in the New York Times said (iii): "No business model of any airline can survive with sustained jet-fuel prices of $90 to $100 a barrel." Yet those are exactly the prices predicted by many experts in the relatively near future; a major natural or manmade disruption could bring them about in a day. There is no relief in sight. This situation cannot be sustained. Within some years or less affordable passenger flight will be history.

It is quite extraordinary that this Master Plan leaves out this most significant factor from it's analysis. More information is included in the notes at the end of this response (vi). A basic understanding of economics shows that this means airfares will skyrocket and schedules will be pared to the bone. As airlines fail and the surviving carriers cut back, flights will be fewer, especially to smaller cities. None but the rich will holiday abroad.

3. Climate Change

Chapter 10 of the Master Plan acknowledges that aviation is a major contributor to climate change and notes that the Department of Transport does not require BIA to take climate change in to account. The Plan states that the effects on climate change from aviation are small and cannot be easily put against individual companies.

Climate change is the greatest environmental challenge facing the world. It is widely acknowledged that aviation is responsible for the fastest growing source of greenhouse gases, and this is particularly severe due to the special nature of the atmosphere in which many aircraft fly. It has been calculated for example that on a London to Sydney flight the carbon emitted per passenger is equivalent to a Mini driving around the earth 640 times (iv).

During the period covered by the Master Plan the Government estimate that aviation could account for about a quarter of the UK’s total contribution to global warming. A European Commission report also says that if the current rate of growth in air travel is continued, it will result in a 150 per cent increase in emissions from international flights from EU airports by 2012. That will offset more than a quarter of the reductions required under the European Union's agreed Kyoto target.

The Government has set a target to cut emissions by 60 per cent by 2050. If aviation emissions continue to grow at the current rate it will make it virtually impossible for the 60 per cent target to be met. Indeed just this week the Government has admitted it will be unlikely to even meet it's Kyoto targets. There is no technological breakthrough on the horizon that will significantly reduce emissions from individual aircraft.

The Plan makes no suggestion of any serious measures being put in place, such as increased landing charges, to start to pay for any of the massive environmental costs that air journeys already create and which will be exacerbated by the proposed expansion.

Growth in passenger numbers must be managed so that the sector plays its part in tackling climate change. This will require action at national, EU and international level to remove the tax exemptions that drive aviation growth. Targets will be needed for the aviation sector to reduce its emissions to 8 per cent below 1990 levels by 2010 and to 15-30 per cent below 1990 levels by 2020. These targets can either be met by direct cuts in the sector’s emissions or by paying for emission reductions in other sectors through any future emissions trading scheme.

Improvements in aircraft technology can deliver 1 per cent a year cuts in emissions so at a local level so allowing a maximum passenger growth of 1 per cent a year would only stabilise emissions.

Other aspects of the expansion will also increase climate change. The effect of concreting over a large section of the hillside for car parking and parking space for aircraft, as well as additional runway space, will lead to greater run off from heavy rainfall and more absorption of heat by the tarmac, both exacerbating the effect of climate change locally. The next sections make some further points regarding the additional traffic generated by the proposed airport expansion.

The European Commission in 2000 stated (v): "The air transport industry is growing faster than we are currently producing and introducing technological and operational advances which reduce the environmental impact at source. The overall environmental impact is bound to increase since the gap between the rate of growth and the rate of environmental improvement appears to widen in important fields such as emissions of greenhouse gases. This trend is unsustainable and must be reversed because of its impact on climate and the quality of life and health of European citizens."

It is clear that any development which takes such little account of climate change should be rejected outright.

4. Roads

The Master Plan is wholly inadequate to deal with any airport expansion: such an expansion will rely on much better local access to the airport than on the currently congested road network.

Lulsgate is in a particularly poor location: distant from any major public transport provision. The Master Plan sets itself a target of increasing usage of the Bristol Flyer bus service, which it describes as being 'challenging'. However, there is no evidence given as to how the target will be realistically achieved, and given the airport's reliance on income from its car parking provision, it seems unlikely that it will have the necessary willingness to support the necessary measures for this.

Even if the target were to be achieved, the number of car journeys to the airport would still be far higher than at present. The Master Plan acknowledges this with its proposals for the 6,000 additional car parking spaces. Implicitly, the Masterplan depends on road improvements outside of its control to provide for these journeys. Whilst these are the subject of consultation elsewhere, the impact of road proposals, such as the South Bristol Ring Road, will be devastating to the local environment of the areas they go through. These include both heavily built up and poor neighbourhoods in south Bristol and areas of particular natural beauty on the hills around the airport and between it and Bristol. In short the expansion proposals rely on measures elsewhere 'doing their dirty work', ruining the local environment for many people who will gain no benefit from the expansion of the airport.

Whatever measures are eventually put in place to improve transport links to the airport, the existing congestion on much of the local road network will undoubtedly get worse, as any road 'improvements' will be filled with extra traffic arriving at both the airport and at workplaces and other facilities which locate in areas close to the airport. Air and noise pollution from traffic in much of Bristol, including roads that are used to convey traffic to the airport, are already very poor, ruining the quality of life for many people.

The direct expansion of land to be used by the airport will have a detrimental effect on the environment around the airport, however much BIA says it will mitigate this. This will affect the visual amenity of the area for some distance around. Past expansion has already affected the road layout on both sides of the airport, adversely effecting local journeys in these areas.

The forecast significant levels of road traffic will have an impact on climate change. Surface transport is responsible for 22 per cent of the UK’s carbon emissions and is a major contributor to local air quality problems.

5. Aircraft noise and health implications

Aircraft noise is a serious health issue for those living close to airports and for those living near flight paths. Studies show that children in schools under flight paths may have their reading age delayed by six months by the noise. Noise from aircraft can also have cardiovascular and psycho physiological effects on human health. A Swedish study found that living under a flight path can increase the likelihood of having high blood pressure by 80 per cent .

The Master Plan tries to show that expansion of services will not be detrimental to those who are affected by aircraft noise. It does this by relying on decibel levels (57dcb) which do not include many who will be severely affected. Both the World Health Organisation and the European Union recommend a maximum level of 50dcb for daytime noise and 30dcb for night noise before noise becomes a particular nuisance. This is a much lower level than that used in the Masterplan, and one which we suspect would include a far larger number of the local population.

In addition, the increased number of flights will mean that it will be necessary to have many more flights passing over more built up areas in the locality, especially in Bristol. This will lead not just to more nuisance from increased noise, but also to other pollution from emissions and waste removal from aircraft here and to more likelihood of risk from aircraft having an accident over an urban area.

6. Air pollution

Aircraft engines emit various pollutants including nitrogen oxides and particulates which have significant impacts on human health and on natural ecosystems. Studies around Zurich Airport and Stockholm Arlanda Airport show that aviation contributes a significant share of total emissions within a well-defined geographical area (ii). The London Borough of Hounslow, which borders on Heathrow Airport and monitors air pollution, is of the view that "further expansion of the airport and associated road traffic congestion could lead to significant worsening of local air quality."

Binding EU health limits are being introduced to limit nitrogen oxide concentrations for people to 40microgrammes/m3 by 2010. Some have suggested it maybe hard to reach this target currently let alone in the future. We need better current air quality monitoring to assess the validity of this claim.

However in any case local air pollution is already a major problem in many parts of the locality, again especially within Bristol, with Government targets being breached in some areas quite regularly. Greater numbers of aircraft flying over the city can only exacerbate this.

7. Unique position of site

Lulsgate's situation is also particularly susceptible to problems caused by the local weather. This is particularly due to the frequent amount of low cloud on the hills reducing visibility here, and has repeatedly led to flights having to be diverted or cancelled. No recognition of this issue regarding the suitability of expansion at Bristol seems to have been made in the Master Plan.

8. Sustainability appraisal

Chapter 11 quotes a definition of sustainable development as: ‘development which meets the needs of the present without compromising the ability of future generations to meet their own needs.’ Yet it is clear that the development of the airport over recent years has not conformed to principles of sustainability. The Master Plan is based on extrapolation from what has already been unsustainable.

The Royal Commission on Environmental Pollution, 18th Report on Transport and the Environment stated as long ago as 1994 that: "…an unquestioning attitude toward future growth in air travel, and an acceptance that the projected demand for additional facilities must be met, are incompatible with the aims of sustainable development."

We in the Green party are committed to the principle that the polluter must pay. Air fares should therefore reflect the real cost of aviation. Aircraft fuel should be subject to an environmental tax, airports should be responsible for paying for necessary infrastructure (surface access, policing, landscaping, noise insulation of properties etc.). We believe that moves towards the ‘polluter pays’ principle will have dramatic downward effects on the forecasts made in chapter 5 of the Plan.

Notes:

(i) Friends of the Earth report: "Why airport expansion is bad for regional economies" August 2005

(ii) A Green party report by Prof John Whitelegg, Dr Spencer Fitz-Gibbon with Dr Seth Crook"Aviation's Economic Downside" (December 2003).
See: http://www.greenparty.org.uk/files/reports/2004/AED3.htm

(iii) The Air Transport Association is the trade association for the leading U.S. airlines. ATA members transport more than 90 percent of all passenger and cargo traffic in the United States.

In a statement before the Aviation Subcommittee Committee on Commerce, Science and Transportation United States Senate, James C. May, President and CEO Air Transport Association of America, Inc. (14/09/05) said:

Re: economic losses: "Over the last four years, the industry – in total – has recorded over $32 billion in net losses (including federal reimbursements for the shutdown and a portion of our security costs). In this post-Katrina economic environment of higher fuel prices and lost revenue from Gulf Coast tourism we are projecting additional losses of at least $9 billion in 2005 – up from earlier projections of $5 to $7 billion. These losses have led us to borrow huge sums to survive, with few assets left to pledge as collateral. For the nine largest airlines, including Southwest Airlines, net debt stood at $81.3 billion at the end of 2004, resulting in a staggering net debt-to-capital ratio of 110.1 percent."

Re: fuel prices: " In January 2001, the price of jet fuel on the spot markets averaged 85.8 cents per gallon. On August 17, as Katrina was building in the Gulf of Mexico, the price stood at $1.87. Today it is hovering around $2.05 per gallon, a 239 percent increase over four years. In 2004, the industry paid $21.4 billion for jet fuel. That tab would have been $5.5 billion lower at 2003 jet fuel prices and a whopping $8.0 billion lower at 2002 jet fuel prices. Moreover, the differential between what refiners pay for a barrel of oil and what are able to sell the same amount of refined product has grown dramatically in recent years, and been driven higher since Katrina.

Re; Future fuel prices: "...the future doesn’t look any brighter. Our forecast shows that we will pay $9.2 billion more for fuel in 2005 than in 2004. If these projections prove accurate, the industry will have faced a 103 percent increase in its fuel costs from 2001 ($14.8 billion) to 2005 ($30.6 billion)... At today’s fares and jet fuel prices, the average breakeven load factor for the industry would need to approach 85 percent (passenger load), including all the low- cost carriers...As I alluded to earlier, the rapid economic expansion in countries like China and India will
demand more and more oil and keep pushing prices higher."

James C. May then goes onto argue for cuts in fuel prices and investment in looking for more oil. This is clearly a misguided analysis of what needs to take place as we've discussed in our response above.

(iv) Figures on jet fuel and greenhouse gases based on 80% occupancy on jumbo jet DC-747. All greenhouse gases expressed as warming equivalent in CO2. Source: air travel calculator at www.chooseclimate.org and United Nations Environment Programme.

(v) Communication on Air Transport and the Environment (COM(1999)640-C5-0086/2000).

(vi) More information about 'peak oil'

The total amount of oil available has always been finite and we've already used up about half of it. We're not going to find any more of it on this planet and thanks to the wonders of geophysics, we now know pretty well how much is left, where it is and who owns it. At current rates of use what is left will last less than 100 years and it gets harder and harder to extract.

Back in 1956, an Amercian geophysicist working for Shell by the name of Dr. M. King Hubbert, figured out that by plotting the rates of extraction of various individual oil wells, he could extrapolate the figures to predict when a particular oil well would start to run dry. Hubbert went on to correctly predict that the U.S.A would reach its maximum peak of oil extraction in the early 1970s. It turned out to be 1971. The peak in oil extraction was henceforth known as 'Hubbert's Peak' or 'Peak Oil'.

Before America 'peaked' in 1971, other countries had gone through the same phase: Austria in 1955 and Germany in 1968. After the U.S came Indonesia in 1977. Recent peaks have been: Gabon (97), U.K. (99), Australia and Oman (00) and Norway (01). All these countries still produce some of their own oil but they all need to import increasing amounts to make up for the growing shortfalls.

OPEC - The Organisation of Petroleum Exporting Counties, in concert with G7 governments, has acted as the world's economic thermostat by regulating the supply, and thereby the price of oil. Traditionally, Saudi Arabia has acted as the ‘swing producer’ by stepping up or cutting back production as required. It is a balancing act between global economic growth and oil supply. Too much oil and the economy races, too little and it stalls. Countries vie for cheap oil to maintain their standards of living and political and economic stability.

The last two great oil-producing regions are Russia together with the countries around the Caspian Basin (expected to peak in 2007), and the Middle East. Soviet oil and gas, although theoretically plentiful, presents enormous technical and geo-political problems for refinement, transportation and delivery. There is also growing competition with the U.S. for these dwindling resources from China, Japan and Europe. China's GDP growth rate continues to exceed a staggering 9%.

By far the largest reserves of easy-to-produce and transport oil are, and always have been, in the Middle East, principally: Saudi Arabia, Iraq and Iran. However, it has now become clear that the OPEC oil companies have been exaggerating reserves to increase quotas and simultaneously using reserve damaging techniques to squeeze oil out faster to meet demand. There doesn't seem to be as much oil left as they say there is, and Saudi Arabia, the cornerstone of OPEC, is on the verge of peaking.

Governments, through official bodies such as the IEA (International Energy Agency), have promulgated the lie of false reserves to maintain political stability and perhaps they were doing so in our best interests while hoping to find viable alternatives. At the same time, illegal wars are started to manoeuvre into favourable positions for future energy supplies. The U.S. is now in control of Iraqís oil output. It was often speculated that Iraq would be the new swing producer after Saudi Arabia peaks, and that the so-called sanctions put in place after the first Gulf war were simply to mothball the oil supply.

A major wildcard is how the global economy will respond to Peak Oil. Our whole debt-based financial system is predicated on economic growth; it is one gigantic house of cards. Stock market volatility is therefore of serious concern as investors, faced with financial turbulence, may behave in wholly irrational ways. However, ask an economist about Peak Oil they will probably say something along the lines of ìthe market will respond, meaning: if a shortage occurs, the price will rise making alternatives financially viable. In other words, a substitute for oil will be found. But there is no substitute for oil.

Predicting an event such as Peak Oil is notoriously difficult, we can only be sure of the exact time of the peak after it has passed. However, the range of estimates given by an informed collection of esteemed energy insiders suggest a time frame between 2005 and 2010. Secondly, the peak as such will probably resemble a bumpy plateau with the oil economies of the world flickering and spluttering as the supply gradually tightens. We may see growing political turmoil and civil unrest, further restrictions of civil liberties, drastic cutbacks on public services, rushed corporate mergers and acquisitions, financial market instability and more small-scale conflicts and insurrections.

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