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Wednesday, October 04, 2006

Aviation and climate change

I am speaking at the annual dinner of the British Airports Group tonight and thought some of my readers would be interested in the speech I am making.

It deals with the problems facing Heathrow, the need for a more integrated transport strategy that recognises aviation as part of the public transport system and the problem of climate change - in other words the world, the universe and everything!

British Airports Group

I don’t need to spell out to this audience the importance of aviation to the British economy. You know the facts better than I do. But there are two important areas of policy that will increasingly affect aviation. They are the rapidly developing global economy with all that that means for air transport and the acute and growing concern over climate change.

I want to address those two issues tonight but before I do let me just make the following comments about the immediate challenges facing Heathrow. I first became concerned about the future of Heathrow in 1999 when I warned in a Parliamentary question that Heathrow could collapse like the London docks unless we addressed the issue of expansion - but expansion in the context of modernisation and greater sustainability. Some people accused me of scare mongering. Now that Munich has overtaken Heathrow in the number of destinations served pushing us into fourth place in Europe people are beginning to pay attention. Soon Milan, Rome and Madrid will overtake us. When the Dubai international hub gets into its stride Heathrow will be squeezed again.

The current security restrictions on Heathrow are pushing increasing numbers of passengers to Amsterdam, Frankfurt and Paris. It will not be easy to get those passengers back again. Currently you can fly to more British regional cities from Amsterdam and Paris then you can from Heathrow. 21 from Amsterdam; 19 from Paris; just 9 from Heathrow. There is a very real struggle to be the premier hub airport for NW Europe and right now Heathrow is in fourth position. That should be a matter of concern for all of us. Yet people still say the future of Heathrow is safe because of the high volume of passengers. Remember this. In the 1960’s the London docks were beating all previous records in terms of imported tonnage. By 1980 every one of them was closed. Technical and economic change happens very fast.

So let me now turn to the global economy and our position in North West Europe. Think of South East England – that region from the Wash round through Oxford to Southampton. There are about 21 million people in that area. One of the most densely populated regions in the world. It is one of the richest regions in Europe and it is a dynamic generator of wealth, prosperity and employment. The Heathrow region within that is critical to its dynamism. Hub airports are like high tech cities. They generate jobs at all levels and drive technological change. If we think of this region in relation to North West Europe then we are part of that equally dynamic and prosperous area which includes northern Germany, northern France, Belgium and Holland. We are on the western edge of that region and that means we need as many of the high tech drivers to locate in this region as possible. Heathrow and air transport is crucial to this regions continuing prosperity. London and the SE of England have many of the characteristics of a mega metropolis but too often we think of London as separate from the south east and the south east as separate from continental Europe. If you want evidence of this look at the various web sites dealing with high speed rail links and airports. I want to quote from just one. It deals with the expansion of Frankfurt airport and its infrastructure. It sums up the challenge we face and how far we are behind in the race to develop a transport infrastructure to service a modern economy serving a global market.

This is the section I wish to quote – with apologies for the jargon!

“In terms of its transportation and economic significance, Frankfurt Airport has long been more than an airport in the classical sense focused only on air traffic. Two examples highlight this especially:  The development of the airport into an intermodal hub, intelligently networking air traffic with rail and road transportation.  And the gradual expansion of the airport to become a freight and logistics centre, offering complete logistics solutions beyond its core airfreight business.

Thus expansion of Frankfurt Airport is not only aimed at the necessary increase in capacity but also has a qualitative dimension: Innovative services in the mobility, logistics, real estate development, facility management and retail fields are developed and offered here, which can be realized only in connection with the existing local airport infrastructure. By networking air and rail traffic Frankfurt Airport has been a trendsetter for many years. The keyword is multi-modal transportation concepts, the technical term for which is intermodality. The Frankfurt airport intermodal transportation hub is connected to all transportation systems: Rail, road, and even waterways. A large share of the fuel needed at Frankfurt airport is brought in via the latter. The airport rail station (today's regional station) went into operation below Terminal 1 as far back as 1972.

AIRail Terminal

In operation since May 1999, Frankfurt airports new high-speed train station has been trailblazing the future of the Frankfurt intermodal transport hub. The high-speed train station connects our airport directly to the European high-speed rail network. Some 150 inter-city express and long-distance trains serve our main line rail station every day. In 2004, the main line station handled some 4.2 million passengers. In financing the station, we put up some two thirds of the costs – an investment of well over €150 million. The AIRail Terminal is also the starting point for the new inter-city express high-speed line to Cologne, connecting the Rhine-Main region with the Rhine-Ruhr region in about one hour. With the further expansion of the high-speed rail network, Frankfurt Airport will become one of Europe's key integrated transportation complexes.”

(Ref: http://www.ausbau.fraport.com/cms/default/rubrik/6/6967.infrastructure@de.htm )

Similar developments are taking place in Amsterdam and Paris not to mention the rapidly expanding emerging global players like China, India and Brazil.

Where is our response to such visionary concepts? Are we really content with a Heathrow development that is primarily focussed on Terminal Five, Crossrail, airtrack and a possible third runway? I want to see a similarly visionary approach to Heathrow and the British transport infrastructure. That is why I was so anxious to get BAA to look at ARUP’s proposals for a development that would link Heathrow into the high speed rail network and at the same time develop a hub arrival point that is designed to check the expansion of road traffic which is a large part of the problem affecting the area around Heathrow. If we are serious about Heathrow remaining a hub airport then we not only need a third runway but we urgently need to think about a modern integrated transport system to support it.

So part of my aim now is to get the people in this region to see continuing change not as a threat but as an opportunity and that brings me to the issue of climate change. I have seen climate change as a growing threat for many years. The scientific evidence isn’t absolute but it is now so strong as to tell us that if we were not to proceed on the basis of a need to reduce carbon output then we would be seriously irresponsible. So, as some of my colleagues and ex colleagues say to me how can you support the aviation industry? Precisely because I have been concerned about climate change for some years I came to the conclusion that only a coherent policy involving individuals, business, government and all other sectors of society have to have a common agenda for the reduction of carbon emissions. Lecturing or hectoring people will not work and the danger is that people lurch between apathy when they think the problem is too big for them to address and panic when they are told that we are on the edge of runaway global warming. When people say that aviation is the fastest rising cause of greenhouse gasses – an assumption I don’t wish to challenge here but simply to observe that it might be useful to look at the way we measure and define industries – I know that it is not enough to point out that (particularly for British aviation) it is from a low base in terms of total carbon emissions. UK domestic and international aviation accounted for six per cent of UK man-made CO2 emissions in 2004 and 0.1% of global CO2 emissions.

But what I really want to ask them is what they are suggesting we do about it? Are they saying we should stop flying, or ration flying? Are they simply asking for higher taxes even though the evidence that higher taxes, unless truly punitive, would not slow the rate of increase in any significant way? Getting people to change their behaviour is famously difficult. As I understand it most people in the aviation industry would readily agree that climate change is a serious threat. But perhaps because aviation is driven by science and technology they recognise that the last thing we need in the face of such a challenge is panic reactions. We could close down the British aviation industry or seriously restrict it and yet have relatively little effect on the overall problem. Similarly we could close down or severely restrict the motor industry or any other rapidly developing service or manufacturing sector of the economy in the vain hope that we would overcome the problem in that way. We could, as a small minority appear to want to do, return to a preindustrial society. That would be a blind and foolish mistake particularly for the country that played such a key role in the scientific and industrial revolutions.

In recent years the media has been doing a particularly good job in alerting the public to the problem of climate change but we now need to build on that and start reporting what is being done so that others can follow best practice. We need to encourage change rather then pick on particular industries as though they alone were the problem. We can all be found guilty of doing too little but guilt is not enough. Some time ago I was doing an interview on a well known and respected national news programme which often reports on the issue of climate change. The office adjoining the studio was well lit with natural daylight and about a quarter of the size of a football pitch. There were no more then six people in it but every single light was on.

I have the same problem. Far too infrequently you can see me in the House of Lords opening 19th century oak panels looking for the light switches. It is not what Lords use to do! I give examples like this not just to show that we can all do much more but also to indicate why picking on one industry is not good enough. I was told on another less well known and respected programme that “We don’t need to fly so much”. But who decides this? I could make a very good case against the need for very many TV programmes. Shall we take out East Enders or Big Brother to help fight climate change? People do express concern about climate change but they also want to fly, drive cars and watch TV. Our job is to try and meet people’s needs in an environmentally sustainable way not to lecture them on what we think their needs should or should not be. In fact we need a concerted approach across all industries and services as well as in our own personal life styles. To pick on one industry or service enables others to think that the problem can be dealt with simply by increasing taxes on one sector of the economy or by restricting a particular service. The problem is more serious than that and psychologically it would encourage people to think that by changing just one or two industries we could solve the problem. It isn’t true.

To confront the challenge of climate change we need action from everyone, whether in the way we use energy in our own homes or in our place of work. We need all sectors in the economy to look at the way they can change working practices and improve technology. And of course we need the Government to draw up the national and international policies that help us face the challenge. I am particularly pleased that all the major political party’s are now committed to developing such policies. Many of you know what the aviation industry has already done. The sustainable aviation strategy launched last year is due to make a progress report at the end of this year. That should and I’m sure will be, given as much publicity as the industry can manage. If we can tell the public that aviation aims to get another 50% fuel efficiency gain by 2020 it will help people to understand that we do not have to close down the aviation industry to combat climate change. Entering the EU emissions trading scheme will also help.

The aviation industry faces a real challenge in getting its message through on the media. In the last couple of weeks I have heard at least two major items on the BBC Today programme in which the primary focus was on cheap flights and the need to “do something” about aviation. Aircraft and aircraft engine manufacturers have been working on more fuel efficient and quieter aircraft for some years and they have made real progress. Fuel efficiency measured in passenger miles on the most modern aircraft is now not that different from family cars but very few people know that. Virgin Atlantic with their recent announcement about fuel research and environmental studies is a good example of how we can show the world we are taking this matter very seriously.

Last year when I was speaking at the Airport Operators Association I said that far more could and should be done to improve ground operations. So I was particularly pleased to hear that the AOA has set up the Airports Carbon Management Group. Every airport needs to advertise the work they are doing to reduce carbon emissions. For example they could inform passengers that they use bio diesel or electric vehicles on the airport itself. Or that they are making sure all new and modernised buildings are made carbon neutral. Or that they are buying some if not all the airports electricity from renewable sources suppliers – something that many householders and some companies already do. There has been talk of a university of aviation being established possibly in the Heathrow region. I would suggest that such a university could have a role in researching aspects of aviation and the environment.

Let’s be quite clear about this. If the scientific evidence becomes so serious to suggest that the challenge of climate change cannot be met without truly drastic action then it isn’t just air transport that will have to be curtailed – it will be much of our modern economy and the impact on our societies will be catastrophic and it is difficult to imagine what life would be like. The evidence however does not suggest panic reactions. It does suggest that in every walk of life and in all our policy options we need to start driving down carbon emissions.

The aviation industry needs to demonstrate what it can do and how it can fit into a transport infrastructure to fit both the economic needs of modern life and the environmental needs. We need to convince the public and some politicians that aircraft are in fact part of the public transport system and look at them in the same way that Frankfurt does in the quote I gave earlier. Perhaps we could start with a discussion about how we fit Heathrow into the high speed rail network. A major and well publicised campaign to reduce carbon emissions on ground operations along with more fuel efficient aircraft and including aircraft emissions in carbon trading would show the public that we are serious about this. In Britain we have a long history of showing how scientific and technological progress can help overcome problems. Remember the people who opposed the growing development of railways in the 19th century arguing that they were noisy and dirty? They were. But we didn’t give in to those arguments. We developed trains so that they became better and cleaner – just as we are with aircraft.

I hope I have helped set an agenda for the future of British aviation. This should be the start of a major effort by all of us to address the challenges and the opportunities.

The issue is too important for us to fail to rise to this challenge.

As always Clive this is engaging and comprehensive. And the question of Heathrow is more complex than at first sight, whatever side of the debate you are sitting on.

Whilst public transport in Britain is frequently maligned, transport as an industry is still a crucial part of the economy: it forms the last significant bastion of manufacturing for example (Britain still makes buses and trains in addition to aviation projects).

Heathrow as the major hub airport compliments the above in a different way - it is a service industry, and its importance can scarcely be overstated. I agree with you fully that the amount of jobs Heathrow provides must run into at least 100,000.

So whether people agree with the expansion of Heathrow or not, it is indisputable that the airport needs to modernise and change what is currently on offer.

We've debated the issue of whether Heathrow can become a 'transfer hub' like Paris or Frankfurt before. I am glad to see that you recognise that for an airport to become a transfer hub in needs to be an 'intermodal' hub ie offering rail and bus services on a regional and national level in addition to links to London. Because Heathrow totally lacks that kind of infrastructure, i can't see Heathrow competing with Paris CDG/Amsterdam Schiphol/Frankfurt in that way.

The problem is that BAA don't seem to recognise that 'transfer traffic' isn't necessarily 'flight to flight' but can be 'rail to air' or 'coach to air'. The one region of Britain where Heathrow is still the main airport is the West Country - yet The Great Western railway does not serve Heathrow. The consequence is that whilst Heathrow will tap into some of this market, poor transport links make it easier to fly from Bristol or Cardiff to Tokyo via Amsterdam than to access Heathrow.

So we see here an example of how disjointed planning means Heathrow loses traffic to Europe by default of not integrating the airport into other forms of transport: Heathrow was designed as the 'local' airport for London rather than a regional/national airport.

BAA is then it's own worst enemy in this. With Heathrow Connect for example, a railway geared towards suburban Londoners and airport workers becomes hugely expensive, so people drive into the airport causing congestion.

The wider context of this is how BAA sees rail/bus transport merely as an addendum to its balance sheet rather than enabling the airports it runs to become better airports. BAA makes money via high charges. As demand for London is very high it will always be guranteed good business - i do not see Heathrow going the way of London Docks, which is where i disagree with you.

But Heathrow is at threat not so much of going bust, as of going into relative decline. The summer security problems were the straw that broke the camel's back as far as British Airways was concerned: the major rows it has with BAA were to do with the poor planning and infrastructure which security changes exposed.
Heathrow's reputation went into freefall as a consequence of botched contingency planning. In the world of airlines alliances, your city and hub has to be the selling point. London is British Airways' greatest asset, Heathrow its drawback. The summer disruption (and all airports are subject to security scares of some sort now and then) angered BA because it meant that the airport can't deliver a robust system of handling aircraft or passengers at peak-time demand.

BAA seems to charge a lot for delivering little in return. And this is now affecting the airport's competitiveness. For example, low cost airlines like Easyjet and Ryanair provide the major domestic and regional feeder services within Britain. Yet because of Heathrow's high landing fees such airlines will fly to Heathrow's direct competitors: Amsterdam Schiphol is both a mainstream and low cost carrier hub.

So Heathrow lacks the national rail infrastructure which in turn forces regional passengers to fly to European hubs (though in turn such feeder services stimulate regional airports in Britain which helps local economies), lacks the cost competitiveness to attract low cost carriers from regional airports, and now seems to lack the ability to operate properly even as an efficient origin and departure airport for Londoners. This harms British Airways/British Midland. But in some ways it further harms Britain's reputation for transport design: a third class airport does not send out the right message to investors. Britain has excellent engineers and industrial designers, but it is notable now that countries seeking to develope air hubs look elsewhere. The new Athens Airport in Greece was built by the same consortium that designed Munich Airport; nobody there was going call in advice from BAA. Plus the airport, already linked via Metro and suburban rail to the city is now developing rail links to ports and regional cities. This in the long term will take some congestion off domestic flights to Athens.

So the case for change is unanswerable. But what form does it take? Does Heathrow Airport alone need to change, or are there wider factors in the balance of air/rail travel that have to be considered?

Clive you have consistently argued the case for a third runway. This was take care of short-haul narrow bodies planes, leaving Heathrow's two main runway to handles higher capacity wide bodies. This would bring in more passengers and aircraft and so in your view protect Heathrow's position as the Europe's prime airport.

But what this summer has proved is that Heathrow badly needs to improve what it does at the moment rather than aim for more expansion. What good does it do to build another runway if at the end of the day you still can't process passengers efficiently? In the long run this would merely underline Heathrow's mediocrity and lose more traffic to Paris CDG/Frankfurt/Amsterdam. BAA's complacency about the damage to its reputation and inadqeuate passenger facilities in turn undermined its claim for a new runway, because it can't cope properly at the moment. BAA is more interested in running airports as overpriced second rate shopping malls than as efficient transport hubs.

This is why changing Heathrow rather than expanding it must come first ahead of claims for a third runway. This is why Terminal 5 in its own way is so crucial: can BAA construct a terminal as efficient and pleasant as Amsterdam Schiphol. How BAA manages passengers and planes is as important as the volume of passengers. Plans to rebuild Terminal One and Terminal Two are also promising: many cities redesign rather than expand airports (eg Toronto Pearson's Terminal 1)

The third runway is for narrow bodies short haul planes, a large number of which will be heading for Paris/Amsterdam plus Glasgow/Edinburgh/Newcastle. And this highlights the case for change of another sort: high speed and affordable rail.

There is a rule in the transport industry that the balance of air and rail travel is measured within three/four hours: that's to say a train journey of around three/four hours can compete with air journeys of comparable distance as in total the journey times are the same (when you add getting to the airport/check-in compared to the point-to-point train journey.

A huge environmental opportunity is missed through not making rail more attractive for select short haul services. Rail fares in Britain are absurdly complex or require you to book substantially in advance to get decent price. Whilst Eurostar has killed much of the air market between Heathrow and Paris/Brussels, it is still often cheaper to get an Air France flight than go by Eurostar. British Airways competes with rather than co-operates with GNER or Virgin Trains. With real investment on the West Coast Main Line plus East Coast, and an extension of Eurostar to Amsterdam, TGV style high speed trains would make many of the domestic and short haul air destinations viable as a train option. This would lead to a reduction in Heathrow-Scotland/Paris/Amsterdam flights, which are operated by just the narrow bodied aircraft for which a third runway is deemed necessary. Cut these flights and you can take away some of these planes from the existing runways without building a third runway.

Air France for example, despite having a much bigger home base to Heathrow, Paris CDG, full works with the TGV system and even is planning on operating Air France TGV trains. Lufthansa in Frankfurt co-operates with Deutsche Bahnhof closely. Because both Paris and Frankfurt airports are pro-rail, their plans for new runways become more plausible because they are not over-reliant on that option alone, but also seek to see how they can relieve pressures on the system in other ways. BAA show get behind improving high speed rail in the UK plus pressuring for more London rail links (eg to Waterloo plus Crossrail)

So there are some non-aviation changes the airport could make to relieve existing congestion both airside and landside. The first step is make Heathrow better on the basics first - so BAA's plans for rebuilding the airport are more plausible than just aiming for runway three as a panacea for the airport's ills.

I don't believe any of this can necessarily prevent Heathrow being in the long run overtaken by Paris CDG or Frankfurt in the aviation stakes. The gap in infrastructure is too large, plus yes both airports have more runways. But it is because they have rail links first that makes them put additional runways to the best advantage. Heathrow is not in that position and a third runway is still not going to compete with Paris' four runways. People from Brussels will catch the TGV to Paris CDG to fly to Toronto, they will not head for Heathrow to go there. Of course Paris CDG has its own faults: it's terminals are lousy (except for 2F), but it has great rail services and large space to expand runways. Frankfurt Main Airport which you chose to analyse is also a major competitor. It has better terminals than Paris CDG, and also a regional/national rail hub, but hasn't the same room for runway expansion than Paris CDG has. What Paris CDG needs to do - and ironically what Heathrow has in mind - is to rebuilt its terminal infrastructure.

But a changed Heathrow, with better regional rail links, better terminals and more efficient customer service would at least repair the airport's reputation as a third world hub. Good rail links would take off some the pressure on Heathrow domestic flights. Better terminal design would make changing planes easier and so boost Heathrow's share of transfer traffic. All this would require substantial investment - so i am not somehow advocating the case for stagnation, rather to improve Heathrow to give London a decent hub airport. An aggrandisment of the present mess would be a trap: more planes and passenger badly managed would lead to more chaos of the sort we have seen this Summer. That would damage Heathrow's reputation further and drive more people within the airport's existing market to head elsewhere.

But if Heathrow really wants to stay number one then in the long run the answer lies in expanding Stansted. Paris Orly was never going to be the busiest airport in mainland Europe, because (like Heathrow) it is surrounded by conurbations. But Paris CDG, built in open space, is. Hindsight is History's way of irritating us, but the decision of Lord Balfour back in 1943 to place London Airport in an area surrounded by suburbs meant that Heathrow never had the chance to be fresh drawing board London and Britain needs for the future of its aviation policy.

I agree that aviation and human activity in the air is one of the causes for the climate change, but still, if we imagine that is the only action we did to provoque climate change, we are having an ireallistic start. It is not the air, which determines the fate of the climate. It is the ocean that does it. Multiple naval war from the last century modified the climate so much.

See more details on http://www.1ocean-1climate.com

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