71
Performance plan for Reference Period 3 Consultation meeting Helsinki 16 August 2019
Performance plan for Reference Period 3
Consultation meeting
Helsinki
16 August 2019
Agenda
‒ Introduction + tour de table
‒ Finnish Transport and Communications Agency Traficom
‒ Legal background + timeframes
‒ Draft performance plan + targets on each Key Performace Area (EU/National)
‒ Safety
‒ Environment
‒ Capacity
‒ Forecasts for traffic, service units and inflation
‒ Cost-efficiency
• Total cost base (en route + terminal)
• Cost evolution
• ANS Finland – costs by nature
• ANS Finland – cost allocation
• Unspent CAPEX in RP2
• WACC (Weighted average cost of capital)
Agenda
‒ Charging policy & traffic risk sharing
‒ Incentive schemes
‒ Investments (ANS Finland)
‒ Questions & Answers
‒ Comments on already received questions
‒ Next steps
‒ Questions / Discussion on performance plan as necessary
16.9.2019 4
Agency reform under the Ministry of Transport and Communications
Traficomofficial functions of
transport and communications
Traffic control companytraffic control and
management services
Transport Infrastructure Agency
management of the State’s infrastructure
assets
16.9.2019 5
Division of responsibilities in transport administration as of 1.1.2019
Finnish Transport and Communications Agency
Traficom
Transport and communications:
• regulation, licence, registration and approval matters
• promoting safety• reducing environmental
impact and
• developing the transport system and digital society
Transport Infrastructure Agency
Road, rail and maritime transport infrastructure:
• maintaining service level• development and
automation• coordinating transport
and land use policies• reducing environmental
impact
Traffic control company
Traffic Management Finland
Road, rail, aviation and maritime traffic:
• traffic management• traffic control data
systems
Trafi, FICORA, Finnish Transport Agency Finnish Transport Agency Finnish Transport Agency, Finrail, ANS Finland
Legal background and timeframes
‒ Commission Implementing Regulation (EU) 2019/317 of 11 February 2019 laying down a
performance and charging scheme in the single European sky and repealing Implementing
Regulations (EU) No 390/2013 and (EU) No 391/2013
‒ Commission Implementing Decision (EU) 2019/903 of 29 May 2019 setting the Union-wide
performance targets for the air traffic management network for the third reference period
starting on 1 January 2020 and ending on 31 December 2024
‒ Requirement for National Supervisory Authority (NSA) to draw up performance plan for
reference period 3 (RP3) covering years 2020 to 2024 inclusive
Initial cost data from NSA to Commission – 19 months before start of of RP3
Indicative target ranges (EU-wide targets) by Commission + consultation – 15 months before
Adoption of EU-wide targets (Commission) – 7 months before
Drawing up performance plans + consultation – 4 months before
Draft Performance Plan
Key Performance Area - Safety
Draft performance plan - Safety
‒ Key Performance Indicator (KPI)
‒ The minimum level of the effectiveness of safety management to be achieved by air
navigation service providers certified to provide air traffic services. This KPI measures the
level of implementation of the following safety management objectives:
• (a) Safety policy and objectives
• (b) Safety risk management
• (c) Safety assurance
• (d) Safety promotion
• (e) Safety culture
‒ NSA proposal for targets to be reached by the end of 2024:
‒ At least level C in the safety management objectives ‘safety culture’, ‘safety policy and
objectives’, ‘safety assurance’, and ‘safety promotion’
‒ At least level D in the safety management objective ‘safety risk management’
RP2 – Effectiveness of Safety Management
Based on self-evaluation questionnaire + NSA confirmation verified on EASA audits
Draft performance plan - Safety
‒ There are also 5 safety performance Indicators (PIs) that will be monitored during RP3
• The rate of runway incursions at airports located in a Member State;
• The rate of separation minima infringements within the airspace of all controlling air traffic services
unit in a Member State;
• The rate of runway incursions at an airport calculated as the total number of runway incursions
with any contribution from ATS or CNS services with a safety impact that occurred at that airport;
• The rate of separation minima infringements within the airspace where the air navigation service
provider provides air traffic services, calculated as the total number of separation minima
infringements with any contribution from ATS or CNS services with a safety impact.;
• Use of automated safety data recording systems by the air navigation service providers as a
component of their safety risk management framework, if applicable
‒ NSA will monitor these indicators on a yearly basis
Draft Performance Plan
Key Performance Area - Environment
Draft performance plan - Environment
‒ Key Performance Indicator (KPI):
‒ The average horizontal en route flight efficiency of the actual trajectory (KEA)
‒ EU-wide target:
‒ … shall not exceed the following percentages: 2,53 % in 2020, 2,47 % in 2021,
2,40 % in 2022, 2,40 % in 2023 and 2,40 % in 2024.
‒ NSA proposal for targets:
‒ 0,97% in 2020 and 2021
‒ 0,96% in 2022, 2023 and 2024
Source: PRU dashboard
Draft performance plan - Environment
‒ Performance indicators (PIs) for monitoring
‒ The average horizontal en route flight efficiency of the last filed flight plan trajectory
‒ The average horizontal en route flight efficiency of the shortest constrained trajectory
‒ The additional time in the taxi-out phase
‒ The additional time in terminal airspace
‒ The share of arrivals applying Continuous Descent Operation (CDO)
‒ The effective use of reserved or segregated local airspace
‒ The rate of planning via available local airspace structures
‒ The rate of using available local airspace structures
NSA will monitor these indicators on a yearly basis
Draft Performance Plan
Key Performance Area - Capacity
Draft performance plan - Capacity
‒ The capacity key performance area includes two KPIs - en route air traffic flow management
(ATFM) delay per flight, and terminal and airport ANS ATFM arrival delay per flight
a. The en route ATFM delay is the delay calculated by the Network Manager, expressed as the difference
between the estimated take-off time and the calculated take-off time allocated by the Network
Manager
b. Terminal and airport ANS ATFM arrival delay per flight means the average time, expressed in
minutes, of arrival ATFM delay per flight attributable to terminal and airport air navigation services
‒ There are 3 performance indicators, which NSA will monitor throughout the reference period
‒ The percentage of IFR flights adhering to their ATFM departure slots;
‒ The average minutes of air traffic control pre-departure delay per flight caused by take-off restrictions
at the departure airport;
‒ The average time, expressed in minutes, of departure delay from all causes per flight
‒ Member states are also required to adopt financial incentives for the ANSPs in capacity KPA.
En-route historical delays
Terminal navigation (TN) historical delays
TN weather delays and target setting
Capacity targets
‒ En route
‒ Terminal
ATFM delayminutes/flt
2020 2021 2022 2023 2024
EU wide target 0,9 0,9 0,7 0,5 0,5
National reference value
0,09 0,09 0,07 0,06 0,06
NSA proposal for targets
0,09 0,09 0,07 0,06 0,06
ATFM delayminutes/flt
2020 2021 2022 2023 2024
EU wide target N/A N/A N/A N/A N/A
NSA proposal for targets
0,30 0,30 0,30 0,30 0,30
Draft Performance Plan
Forecasts for traffic, service units and inflation
Traffic forecasts
‒ The performance plan shall include:
‒ (f) en route traffic forecasts, expressed in terms of IFR movements and in service units and based on
Eurocontrol's STATFOR base forecast;
‒ (g) terminal traffic forecasts, expressed in terms of IFR movements and in service units, based on
Eurocontrol's STATFOR base forecast;
‒ However, as regards point (f) and (g), national supervisory authorities may decide to use other en
route and terminal traffic forecasts than those based on Eurocontrol's STATFOR base forecast. In that
case, they shall consult the airspace users' representatives and air navigation service providers
concerned and set out the reasons for using the other forecasts in the performance plan.
Any differences with the Eurocontrol's STATFOR base forecast shall be related to specific local factors
not sufficiently addressed by Eurocontrol's STATFOR base forecast. The same forecasts shall be used
for all key performance areas.
Before the STATFOR forecast is published ECTL requests stakeholder to review the input data and
draft output before publication, and to suggest additional or refined assumptions (ANSP’s has been
informed about this by NSA).
NSA has asked from ANSPs if there are any specific local factors not sufficiently addressed by
STATFOR.
NSA has not received any detailed statistical ”competing” forecasts with reasoning from ANSPs and
therefore NSA is of the opinion that STATFOR base forecast should be used for RP3.
Total Service Unit (TSU) forecast for en-route
Total Service Unit forecast for Terminal Navigation
Inflation forecast
‒ (11) ‘forecast inflation index’ means the annual inflation index based on the third year before the start of a reference
period and computed by using the latest available inflation forecast of average Consumer Price Index
percentage change published by the International Monetary Fund for the Member State concerned at the time
of drafting the performance plan. In case the percentage change published by the International Monetary Fund for a
given year is negative, a zero value shall be used.
2019 2020 2021 2022 2023 2024
5.1 Inflation % 1,33 % 1,51 % 1,80 % 1,90 % 2,00 % 2,00 %
Draft Performance Plan
Key Performance Area – Cost-efficiency
Total en-route cost base including baseline and targets
a) Baseline value for the determined costs and the determined unit costs (in real terms and in national currency)
2019 baseline value for the determined costs (in real terms and in national currency) 44 086 514
2019 latest available service units forecast (actual route flown, see point 1.2 of Annex VIII) 1 001 883
2019 baseline value for the determined unit costs (in real terms and in national currency) 44,00
b) Cost-efficiency performance targets
En route charging zone Baseline 2014 Baseline 2019 RP3 Performance Plan (determined 2020-2024) CAGR CAGR
Finland 2014B 2019 B 2020 D 2021 D 2022 D 2023 D 2024 D 2014A-2024D 2019B-2024D
Total en route costs in nominal terms (in national currency) 47 103 724 49 488 268 50 911 212 51 887 984 54 069 042
Total en route costs in real terms (in national currency at 2017 prices) 44 317 361 44 086 514 45 611 493 47 278 913 47 932 069 48 141 000 49 492 750 1,1% 2,3%
YoY variation 3,5% 3,7% 1,4% 0,4% 2,8%
Total en route Service Units (TSU) 793 689 1 001 883 1 022 649 1 035 657 1 050 666 1 063 675 1 076 683 3,1% 1,5%
YoY variation 2,1% 1,3% 1,4% 1,2% 1,2%
Real en route unit costs (in national currency at 2017 prices) 55,84 44,00 44,60 45,65 45,62 45,26 45,97 -1,9% 0,9%
YoY variation 1,4% 2,4% -0,1% -0,8% 1,6%
Real en route unit costs (in EUR2017) 1 55,84 44,00 44,60 45,65 45,62 45,26 45,97 -1,9% 0,9%
YoY variation 1,4% 2,4% -0,1% -0,8% 1,6%
National currency EUR
1 Average exchange rate 2017 (1 EUR=) 1,0
Consistency (en-route)
e) Description and justification of the consistency between local and Union-wide cost-efficiency targets
1. The RP3 DUC trend or the long-term DUC trend (covering both the reference period covered by the performance plan and the previous reference period):
These are not decreasing at the same rate with the corresponding Union-wide targets. The RP3 DUC trend is +0,9 % p.a. (Union wide target is -1,9 % p.a.). The long-term DUC trend is -1,9 % p.a. (Union wide change
should -2,7 % p.a.).
2. The peer group review:
When comparing the baseline value for the determined unit cost to the same values of the comparator group (where ANSPs have a similar operational and economic environment) the value is considered as
consistent with the Union-wide target. That group includes Finland, Sweden, Norway, Denmark and Ireland. The value is about - 8,5 % below the average of the comparator group, when using the latest available
estimates (situation on 5.7.2019). With the same available estimates the DUC value for 2024 is still well below the average of the comparator group for en-route services.
Note: In addition to what is mentioned above, the NSA is of the opinion that e.g. the excellent level of historical and expected delays should be taken into account when assessing the cost-efficiency.
Consistency (en-route)
Total TN cost base including baseline and targets
a) Baseline value for the determined costs and the determined unit costs (in real terms and in national currency)
2019 baseline value for the determined costs (in real terms and in national currency) 17 842 629
2019 latest available terminal service units forecast 127 478
2019 baseline value for the determined unit costs (in real terms and in national currency) 139,97
b) Cost-efficiency performance targets
Terminal charging zone Baseline 2019 RP3 Performance Plan (determined 2020-2024) CAGR
Finland - TCZ 2019 B 2020 D 2021 D 2022 D 2023 D 2024 D 2019B-2024D
Total terminal costs in nominal terms (in national currency) 18 748 069 19 507 839 19 780 379 19 852 751 20 415 146
Total terminal costs in real terms (in national currency at 2017 prices) 17 842 629 18 051 977 18 450 635 18 334 110 18 037 320 18 189 854 0,4%
YoY variation 1,2% 2,2% -0,6% -1,6% 0,8%
Total terminal Service Units (TNSU) 127 478 132 590 133 342 134 490 135 069 135 150 1,2%
YoY variation 4,0% 0,6% 0,9% 0,4% 0,1%
Real terminal unit costs (in national currency at 2017 prices) 139,97 136,15 138,37 136,32 133,54 134,59 -0,8%
YoY variation -2,7% 1,6% -1,5% -2,0% 0,8%
Real terminal unit costs (in EUR2017) 1 139,97 136,15 138,37 136,32 133,54 134,59 -0,8%
YoY variation -2,7% 1,6% -1,5% -2,0% 0,8%
National currency EUR
1 Average exchange rate 2017 (1 EUR=) 1,0
Contribution (TN)
e) Description and justification of the contribution of the the local targets to the performance of the European ATM network
1. Comparison with the RP3 en-route DUC trend at local level:
When comparing RP3 DUC trend with the en-route DUC trend it can be seen that TN trend exceeds the en-route trend. En-route trend for RP3 is +0,9 % p.a. and TN trend is -0,8 % p.a.
2. Level and trend of actual performance during the reference period which precedes the reference period covered by the performance plan:
Because TN was not SES regulated the comparison has to be made between 2015 and 2024. The trend for TN between 2015 (actual unit cost) and 2024 DUC is -0,60 % p.a.. The trend for
en-route between 2015 (actual unit cost) and 2024 DUC is -2,84 % p.a.. However, it must be taken into account that for RP2 Finland set the target as proposed by the PRB. That was to
freeze the real total costs. That led to DUC trend of -2,2 % p.a. between 2015 and 2019.
3. At airport level, comparison of performance with similar airports:
NSA compared the TN services with the same comparator group countries (where ANSPs have a similar operational and economic environment) that was set for en-route services.
When comparing the baseline value for the determined unit cost to the same values of the comparator group the value is about - 11 % below the average of the comparator group,
when using the latest available estimates (situation on 3.7.2019). With the same available estimates the DUC value for 2024 is about -24 % below the average of the comparator group
TN services.
Contribution (TN)
Draft Performance Plan
Cost evolution & Costs by nature
Cost evolution
‒ Total costs including all entities (en route and terminal)
‒ NSA – Finnish Transport and communications Agengy
‒ MET – Finnish Meterological Institute
‒ ANSP – ANS Finland (~ 90 % of all costs)
‒ ANS Finland – costs by nature
All entities - cost evolution in real terms – En route
ANS Finland - staff cost evolution in real terms – En route
26,8926,08
25,18
22,23 21,84 21,67 21,45 21,18 20,94 20,70
0,00
5,00
10,00
15,00
20,00
25,00
30,00
18500
19000
19500
20000
20500
21000
21500
22000
22500
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
ost
s (2
01
7€
)
Tota
l co
sts
(20
17
€)
Staff cost evolution in real terms (Enroute)
Staff (total costs) Staff (unit cost)
ANS Finland - other operating cost evolution in real terms – En route
17,1317,85
13,18
11,60 11,71 11,89 11,80 11,74 11,69 11,69
0,00
2,00
4,00
6,00
8,00
10,00
12,00
14,00
16,00
18,00
20,00
0
2000
4000
6000
8000
10000
12000
14000
16000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
ost
s (2
01
7€
)
Tota
l co
sts
(20
17
€)
Other operating cost evolution in real terms (Enroute)
Other operating costs (total costs) Other operating costs (unit cost)
ANS Finland - depreciation cost evolution in nominal terms – En route
5,20
5,80
3,61 3,69
3,273,50
4,26 4,354,62
5,55
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
0
1000
2000
3000
4000
5000
6000
7000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
ost
s
Tota
l co
sts
Depreciation cost evolution in nominal terms (Enroute)
Depreciation (total costs) Depreciation (unit costs)
ANS Finland - cost of capital evolution in nominal terms – En route
2,72
2,43
0,820,75
1,00
1,22
1,45
1,59
1,74 1,77
0,00
0,50
1,00
1,50
2,00
2,50
3,00
0
500
1000
1500
2000
2500
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
ost
s
Tota
l co
sts
Cost of capital evolution in nominal terms (Enroute)
Cost of capital (total costs) Cost of capital (unit costs)
All entities - Cost evolution in real terms – Terminal
ANS Finland - staff cost evolution in real terms - Terminal
73,17 73,25
82,06
74,92 75,05
73,35 73,2272,80 72,70 72,87
68,00
70,00
72,00
74,00
76,00
78,00
80,00
82,00
84,00
0
2000
4000
6000
8000
10000
12000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
ost
s (2
01
7€
)
Tota
l co
sts
(20
17
€)
Staff cost evolution in real terms (TN)
Staff (total costs) Staff (unit cost)
ANS Finland - other operating cost evolution in real terms - Terminal
37,80 37,53
50,40
45,14
47,45 47,01 47,48 48,09 48,9450,20
0,00
10,00
20,00
30,00
40,00
50,00
60,00
0
1000
2000
3000
4000
5000
6000
7000
8000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
ost
s (2
01
7€
)
Tota
l co
sts
(20
17
€)
Other operating cost evolution in real terms (TN)
Other operating costs (total costs) Other operating costs (unit cost)
ANS Finland - depreciation cost evolution in nominal terms - Terminal
13,53 13,69
7,71
7,086,72
5,88 5,83
3,31
2,14 2,01
0,00
2,00
4,00
6,00
8,00
10,00
12,00
14,00
16,00
0
200
400
600
800
1000
1200
1400
1600
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
oss
t
Tota
l co
sts
Depreciation cost evolution in nominal terms (TN)
Depreciation (total costs) Depreciation (unit costs)
ANS Finland - cost of capital evolution in nominal terms - Terminal
6,22
4,96
1,53
1,211,38 1,28 1,28
1,111,00 0,92
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
0
100
200
300
400
500
600
700
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024
Un
it c
oss
t
Tota
l co
sts
Cost of capital evolution in nominal terms (TN)
Cost of capital (total costs) Cost of capital (unit costs)
Draft Performance Plan
Cost Allocation
ANS Finland – Cost allocation principles
‒ All ACC cost are allocated to en route cost base
‒ All TWR cost are allocated to terminal cost base
‒ APP cost are allocated to en route and terminal cost bases according to distance based rule.
a) Costs related to flight 0-20km from the airport are in terminal cost base (=TWR cost)
b) Costs related to flight over 20km from airport are in en route cost base.
c) 20 km has been chosen because according to charging regulation 20km is deducted from
chargeable en route flight in both ends of the flight
d) For practical reasons costs of APP and TWR are in the same cost center. 40% of total TWR/APP
costs are allocated to en route and 60% to terminal
e) Costs of services common to both en route and terminal services are allocated in proportional
way. These service include for example technical ANS, AIS and administration.
16.9.2019 47
TWR+APP
0-70 km
APP 50 % of costs
= 5-70 km
50 km
77 % Enroute
40 % TWR+APP costs are allocated to enroute(Helsinki-Vantaa, Rovaniemi, Kuopio, Jyväskylä,
Tampere-Pirkkala)
15 km
23 % TN
TWR 50 % of costs
=0-5 km
100 % TN
TWR+APP cost allocation, 20 km rule
Draft Performance Plan
Unspent CAPEX in RP2
Unspent CAPEX in RP2 in nominal terms
‒ Unspent depreciation costs in RP2
‒ Unspent cost of capital in RP2
Enroute M€ Terminal M€
Planned cost of capital costs RP2 9,2 2,5
Actual cost of capital RP2 est. 6,3 1,6
2,9 0,9
Structural change 2017 (2017-2019), Est. 24 % enroute / 56 % Terminal -0,7 -0,5
Unspent depreciation costs in RP2 2,2 0,4
Enroute M€ Terminal M€
Planned depreciation costs RP2 25,0 8,0
Actual depreciation costs RP2 est. 18,2 5,3
6,8 2,7
Structural change 2017* est. (2017-2019) -1,6 -1,5
*Part of the asset base is owned by Finavia -> ANS Finland's leasing costs 5,2 1,2
Decreased/compensated in RP3 cost base -1,2 0
Unspent depreciation costs in RP2 4,0 1,2
Draft Performance Plan
Weighted Average Cost of Capital (WACC)
WACC
‒ During RP3 the efficient model suggested by Steer Davies Gleave in their study on cost of
capital, return on equity and pension costs of air navigation service providers is used as a
guidance in WACC calculation.
This is the same model as was used for RP2. According to the study, this model will ensure
cost reflective charges and align with the broad objective of economic regulation to
encourage an efficient allocation of resources across the economy.
‒ Application of this option would require the following:
‒ The cost of equity to be calculated using the CAPM;
‒ The cost of debt should be estimated by reference to market borrowing rates;
‒ The assumed gearing should be the optimal level rather than the level actually prevailing when the calculation is made;
‒ The assumed risk free rate should be set by reference to government bond yields providing financial markets are
relatively stable, and by reference to an appropriate comparator such as ECB bond rates otherwise;
‒ The asset beta should be within a recommended range of 0.3 to 0.5 unless the ANSP is able to justify a value outside
the range; and
‒ All components of the calculation should be identified transparently and justified.
WACC
‒ After ANS Finland was incorporated to Traffic Management Finland Group it was decided that
ANS Finland pays back all ANS Finland’s loans. However, the previous target gearing of 1,5
of ANS Finland has been used as a proxy for the optimal gearing in the WACC calculations.
‒ NSA is of the opinion, that the above mentioned actual leverage is not based on an
assessment of the optimal level of gearing. Raising debt is a cost-efficient way of raising
finance as the interest rates are typically significantly lower than the cost of equity. This is
also reinforced by the tax benefits. Hence, the NSA has decided that the gearing of 1.5 shall
be used for the RP3 WACC calculations. This should encourage towards the optimal capital
structure.
WACC
Draft Performance Plan
Charging policy & Traffic Risk Sharing
Charging policy
‒ Charging policy includes, inter alia, the timing of adjustments to unit rates and cross-
financing between terminal charging zones. In can also considered to cover, where
applicable, the (intended or already applied) implementation of a mondulation mechanism
(Supporting material for the development of RP3 PPs, developed by EY and Helios).
Finland’s policy has always been to make adjustments as soon as possible but to avoid big
changes in prices. E.g. Finland has delayed underrecoveries form RP1 (due to traffic risk
sharing) until as far as RP3.
Most of the timings of the adjustments are determined in the regulation. There is a change
in the regulation with regard to underrecoveries. Now also the underrecoveries must be
must be recovered through adjustments of the unit rate in year n+2.
Traffic risk sharing
5.1.1 Traffic risk sharing - En route charging zones
Finland no
Dead bandRisk sharing
band
% loss to be
recovered
Max. charged if
SUs 10% < plan
% additional
revenue returned
Min. returned if
SUs 10% > plan
Standard parameters ±2,00% ±10,0% 70,0% 5,6% 70,0% 5,6%
5.1.2 Traffic risk sharing - Terminal charging zones
Finland - TCZ no
Dead bandRisk sharing
band
% loss to be
recovered
Max. charged if
SUs 10% < plan
% additional
revenue returned
Min. returned if
SUs 10% > plan
Standard parameters ±2,00% ±10,0% 70,0% 5,6% 70,0% 5,6%
Traffic risk-sharing parameters adapted?
Traffic risk-sharing parameters adapted?
Service units lower than plan Service units higher than plan
Service units lower than plan Service units higher than plan
Draft Performance Plan
Incentive Schemes
Incentive scheme (en-route)
5.2.1.1 Parameters for the calculation of financial advantages or disadvantages - Enroute
Enroute Expressed in
fraction of min
% of DC
% of DC
modulated
2020 2021 2022 2023 2024
0,09 0,09 0,07 0,06 0,06
±0,050 ±0,050 ±0,050 ±0,050 ±0,050
0,09 0,09 0,07 0,06 0,06
0,05 0,05 0,03 0,02 0,02
[0-0,1] [0-0,1] [0-0,08] [0-0,07] [0-0,07]
n/a n/a n/a n/a n/a
[0,1-0,1] [0,1-0,1] [0,08-0,08] [0,07-0,07] [0,07-0,07]
ANS Finland
NOP reference values (mins of ATFM delay per flight)
Performance Plan targets (mins of ATFM delay per flight)
Bonus range
Value
±0,050 min
0,00 %
0,50 %
Dead band Δ
Max bonus (≤2%)
Max penalty (≥ Max bonus)
The pivot values for RP3 are
Pivot values for RP3 (mins of ATFM delay per flight)*
Alert threshold (Δ Ref. value in fraction of min)
Financial advantages / disadvantages
Dead band range
Penalty range
* When modulation applies, these figures are only indicative as they will be updated annually on the basis of the November n-1 NOP and the methodology
described in 5.2.1.2.a2 below. The pivot values for year n have to be notified to the EC by 1 January n.
Incentive scheme for en-route (2020)
Incentive Scheme (TN)
5.2.2.1 Parameters for the calculation of financial advantages or disadvantages - Terminal
Terminal Expressed in
fraction of min
%
% of DC
% of DC
modulated
2020 2021 2022 2023 2024
0,3 0,3 0,3 0,3 0,3
±0,150 ±0,150 ±0,150 ±0,150 ±0,150
0,30 0,30 0,30 0,30 0,30
[0,23-0,37] [0,23-0,37] [0,23-0,37] [0,23-0,37] [0,23-0,37]
[0,15-0,23] [0,15-0,23] [0,15-0,23] [0,15-0,23] [0,15-0,23]
[0,37-0,45] [0,37-0,45] [0,37-0,45] [0,37-0,45] [0,37-0,45]
Bonus/penalty range Δ (in fraction of min)
Value
Dead band Δ ±0,070 min
Bonus/penalty range (% of pivot value) ±50%
Max bonus 1,50 %
Max penalty 1,50 %
The pivot values for RP3 are
Performance Plan targets (mins of ATFM delay per flight)
Pivot values for RP3 (mins of ATFM delay per flight)*
Dead band range
Bonus range
Penalty range
Financial advantages / disadvantages
* When modulation applies, these figures are only indicative as they will be updated annually on the basis of the methodology described in 5.2.1.2.a below. The
pivot values for year n have to be notified to the EC by 1 January n.
Incentive scheme for TN (2020)
Investments (ANS Finland)
Draft Performance Plan
Questions & Answers
Questions & Answers
‒ Comments on already received questions
‒ Finnish Air Traffic Controllers Association (SLJY)
• Question about the group contibution to Traffic Management Finland which they claim to be 2 M€.
This will inrease the costs that users are paying. Is this in compliance with the regulation?
• NSA has not been aware of this fixed amount group contribution. NSA’s undestanding has been
that these are administrative/overhead costs and they have been allocated based on sound accounting
principles.
• The regulation is clear which costs are eligible.
• The cost base for en route and terminal charges shall consist of the determined costs related to the provision of air navigation services in the charging zone concerned.
• The costs to be taken into account in this context shall be those assessed in relation to the facilities and services provided for and implemented under the ICAO Regional Air Navigation Plan, European Region.
• In short, charges should be based on the costs to provide these services (cost relatedness).
NSA will verify this issue before finalising the performance plan
Questions & Answers
‒ SLJY’s question about the change in allocation between the amount of operative
traffic controllers and superiors which do not work full time in operative traffic
controlling functions. They claim that this will increase costs and ask if this in
compliance with the regulation.
NSA considers this to be fully ANS management/owner decision (including safety
management). Staff costs are eligible if they are related to the provision of air
navigation services in the charging zone concerned.
Questions & Answers
‒ SLJY’s question about the cost of delays for airspace users. What is the acceptable
delay in Finland?
Capacity targets are set in the PP. If targets are met the delays are acceptable from the NSA’s and
Network Manager’s point of view. However, incentive schemes must be taken into account too which
incentives performance.
For the cost of delay there are several estimates. NSA has not calculated these costs but ECTL has
used in their calculations 100€ per min (PRB Advice to the Commission in the setting of Union-wide
performance targets for RP3, Annex C)
Note. Zero delay may not be optimal delay because of the costs to provide this capacity and on the other hand the cost
of delays for the airspace users. To calculate the optimal capacity cost-to-delay elasticy has to be known. ECTL was not
able to calculate that for Finland. ANS Finland has informed the NSA that they do not have additional costs to provide
zero delay compared to NOP target.
Questions & Answers
‒ SLJY’s question about the personnel rewarding system. SLJY claims that the
present system in not adequate to the situation. Part of the profits of the financial
period will be paid to personnel according to the agreed criterion.
This is decided by ANS Finland and it belongs to the management/owner of the
company.
Note. The regulation limits the risk (and therefore profits) of the service provider.
Traffic risk sharing limits the profits (or losses) to 4,4%. The only way to gain
more is to reduce costs below determined costs. The return on equity is defined in
the performance plan.
Questions & Answers
ANS Finland
‒ Comment that biggest customers (airspace users) have requested no delays
‒ ANS Finland comments that it cannot make investment decision on behalf of Finavia
NSA has not claimed or assumed so. The reasoning is explained in the incentive scheme part (TN).
‒ Comment that there should also be ”bonus” possibility in en route incentive scheme. In contradiction to
the previous information received from ANS Finland, they now state that this level of service has required
a lot of measures. However NSA has not received any detailed calculations/evidence.
The reasoning has already been discussed. When costs were asked from ANS Finland earlier they claimed that there is
no additional costs to provide capacity below NOP target. NSA has not been informed e.g about a rewarding system
related to capacity. All the costs needed for the zero capacity are already included in the determined costs. With the
available information the NSA has created the incentive scheme for en route.
Questions & Answers
Finavia
‒ Finavia asked about the inflation assumpion. Why such a high inflation is used? They
compare inflation forecast to one profided by the Finnish Ministry of Finance
This is already explained in the ”inflation forecast” part.
‒ Finavia asked about the traffic forecast for TN being too low.
The reasoning has already been given in the ”traffic forecast” part.
Next steps
‒ Consultation period ends on 23rd of August
Traficom will evaluate the comments received and adjust the plan as
necessary
Performance plans must be submitted to the Commission by the end of
September
By the end of October, the Commission will conduct a verification process
on draft performance plans
If all necessary elements are found in the draft plans, they will come into
effect on 1 January 2020
Formal assessment of performance plans and targets by the Commission
If the Commission’s assessment is positive, a formal decision will be
adopted formalising the performance plan and targets by the end of
February 2020
Contact
Jani Luiro
Adviser
Jani.Luiro(at)traficom.fi
Päivi Palokangas
Special Adviser
Paivi.Palokangas(at)traficom.fi
Markku Tyynelä
Senior Inspector
Markku.Tyynela(at)traficom.fi
