SESAR Innovation Days
Key note briefing SID 2015Challenges and opportunities for innovation
Xavier FRONEUROCONTROL
Performance Coordinator
01/12/2015
Topics
� A bit of history� What is the current situation?� Why do we need to act? � Key challenges and opportunities for innovation� Final word
Key note briefing SID 2015 2
Some innovations in ATC
� Surveillance� 30’s-40’s: Radar, identification (IFF)
� Accidents, safety requirements (Normandie liner, 1935)� MIL requirements: WW II
� 70’s: Digitalisation, radar processing� Technology opportunities (computers, signal processing)
� NAS, CAUTRA III in 70’s
� TCAS� Developed in US after collision (Grand Canyon, 1956)� Standardised in ICAO� Mandated in US from 1/1/1993 after collision (San Diego, 1978)
� Central Flow Management� Implemented in US after US controllers’ dismissal (1981)� CFMU implemented (1995) following delay crisis at end of 80’s
Key note briefing SID 2015 3
4
ANS in the European aviation context (1/2)
≈ 6% of Airline operating costs (Europe)
Source: AEA
Air transport delay (2013)All ≈ 9 min. per flight
ANS-related ≈1 min. per flight
≈ 6% of aviation related CO2 emissions (0.2% of total emissions)
Safety No accident with ANS contribution since 2011
Reported incidents in 0.3% of flights
Although ANS is comparatively small in aviation context….
GDP from Air Transport in EU ≈ €121 B
Source: ATAG
Air Navigation Services ≈ €7.5 B
Key note briefing SID 2015
5
ANS in the European aviation context (2/2)
ANS generates….
� Value…..� Aviation Safety
� Efficient flow of air traffic
� Environmental impact
� Emissions, noise
� Costs ….� Ground economic cost ≈ € 10.5 B
� Direct ANS provision costs (user charges)
� Indirect service quality related costs
� Airborne ANS costs (€2.5B p.a. for 10 years?)
� High penalties to economy if disrupted
� Daily loss of some €1.5B per day (volcano)
… but the stakes are still high!
Key note briefing SID 2015
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
Performance improvements
Key note briefing SID 2015
European policies bring improvements in 3 KPAs while maintaining safety at acceptable levels
No fatal ANS-related accidents since 2011
0
1
2
3
4
5
6
7
8
9
10
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
Nu
mb
er
of
acc
ide
nts
ANS-related accidents and accidents with ANS contribution in
Commercial Air Transport (CAT), (fixed-wing, weight > 2 250 kg)
Fatal
Non-Fatal
Accidents with
ANS Contribution
Source: EASA
6
Flight-efficiency improving faster than traffic (carbon neutrality)
Improvements in both unit costs and delaysFurther improvements driven by SES
KEP(FlightPlan)
KEA(Actualroute)
0.0
1.0
2.0
3.0
4.0
5.0
6.0
0.5
0.6
0.7
0.8
0.9
1.0
1.1
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
€2
00
9 p
er
kil
om
etr
e
En-route unit costs (€2009/km)
Traffic in km (index: 1990=1)
En-route delay (summer)
All States in Route Charges system
Source : EUROCONTROL/CRCO, NM (delay)
Min
utes
of e
n-ro
ute
AT
FM
del
ay p
er fl
ight
and
traf
fic in
dex
How does European ANS system compare?
High unit costsSimilar Punctuality
2011 ATM/CNS provision costs (€/flight hour)
+50%
(SES)
70%
72%
74%
76%
78%
80%
82%
84%
86%
88%
90%
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Departures (<=15min.) Arrivals (<=15min.)
70%
72%
74%
76%
78%
80%
82%
84%
86%
88%
90%
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
On-time performance compared to schedule
(flights to or from the 34 main airports)
Europe US (CONUS)
Source: CODA; PRC analysis Source: ASPM data
Acceptable Safety levelson both sides of Atlantic
0
100
200
300
400
500
600
+100%
Similar environmental impact
Key note briefing SID 2015 7
Increasing focus on economic efficiency
Why do we need to act?
� Performance is improving� But major challenges remain in ANS…
� Opaqueness in Safety� Risk measure, safety built in new concepts
� Environmental impact of aviation� Emissions, noise� Politically sensitive, at EU, national and local levels
� High ANS costs� Poor productivity of a labour intensive industry� Rigid service provision� Fragmentation of airspace, service provision, infrastructure
� Organisational/governance issues� Monopolies, little competition, weaknesses in oversight� Human resource and social issues� Airspace users bear all ANS costs, have little say� Complex decision making
� … and new challenges are emerging� Volatile economy, air traffic demand� High demand for R/F spectrum� Remotely Piloted Aircraft Systems (RPAS)
8Key note briefing SID 2015
9
25
2035-10%
-5%
5%
Flig
hts
in E
urop
e (M
illio
n)
Ann
ual G
row
th
20302020201520102005200019951990198519801975197019651960 2025
15
0
20
10
5
-5
IFR traffic in Europe1960-2012 historical figures2013-2035 forecast
0%
Long-TermTrend before 2009
Long-Term Trend
=
AnnualGrowth
ActualTraffic
Long-TermAverage Growth
ForecastTrafic
Key challenges - Air Traffic predictability
-8
-6
-4
-2
0
2
4
6
8
10
12
14
1971
1973
1975
1977
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
2009
2011
2013
2015
% c
han
ge o
ver
year
(R
PK
s)
-5
-3
-1
1
3
5
7
9
% c
hang
e o
ver
year
(G
DP
)
Global RPKs (left scale)
World GDP (right scale)
Growth in global Gross Domestic Product (GDP) a nd Revenue Passenger Kilometres (RPK)
sources:GDP: data and forecasts - EIU, RPK: data 1971-2009 - ICAO, RPK: estimate and forecasts 2010-2016 - IATA December 2010
• Traffic foreseen for 2020 may happen in 2035!• Highly volatile economic growth• Air traffic closely linked with economic growth� Wide uncertainties in traffic forecasts• Flexibility to remain efficient in different scenarios!
Key note briefing SID 2015
Driving ANS Safety Performance
10
- ICAO USOAP audits
- SES targets for RP2
Compliance based
- Accidents
- Serious Incidents
- Other measures?
Risk based
Adequate KPIs, incentives
and regulations
Behaviors
1
2
3
Key note briefing SID 2015
Airspace design and management
� Aviation ENV objectives � ACARE: emissions halved in 2050,
Carbon-neutral in 2020
� Environmental impact� Free routes implemented
in 30/65 ACCs (AF 3)� KEA: Improving faster than traffic� En-route already Carbon-neutral!
� Economic impact� Economic cost estimate: €2.2B � No heavy infrastructure required,
unlike train, road� A key area for further improvement
� Improving performance further� SES-wide free routes� Advanced FUA� Sequencing and TMA (RTA, etc)� Key role of Network Manager� Innovations?
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
11Key note briefing SID 2015
Sequencing and TMA
� Much room for improvement� Fuel, flight, economic efficiency� TMA/Runway throughput� Safety
� But very challenging� ENV constraints� Interactions with airport, airlines operations� Hundreds of very different airports� Weather, wake vortex, etc
� Real challenges and opportunities for innovation
Key note briefing SID 2015 12
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
Predictability of operations
� Strong links between airline, airport and ATC operations� A tightly coupled network� Added value of better predictability on Aviation GDP (~€120B)
and passenger value of time
13
Network Management
Runway capacity
Taxi-in
Turn-around
ATFM slots
Taxi-out
ATC - Departure
ATC En-route
ATC - Arrival Arrival
Departure
Key note briefing SID 2015
• Staff: an essential part of ATM• Essential role in delivery• 2/3 of costs (€ 4B p.a.)• 43 500 workers
• Research on productivity, human factors• Shifting the labour/capital balance?
Human resources (5th pillar)
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
2011 data US SES areaUS vs. SES
Flights 16.0 M 9.4 M +70%
ATCO staff 13 300 14 300 -7%
Other staff 22 200 29 200 -24%
Total 35 500 43 500 -18%
Flight per staff 450 216 +108%
14
48%
52%
Exceptional Items0.8%
Cost of capital7.2%
Staff costs62.5%
Non-staff operating costs
18.0%
Depreciation costs11.5%
ATCOs in OPS employment costs
Other staff employment costs
Contributions to social security scheme and
taxes8.2%
Pension contributions
14.5% Gross wages and salaries
75.4%
Other staff related costs or
benefits1.9%
Key note briefing SID 2015
Ground infrastructure, airborne equipment
� Highly fragmented, disparate, costly ground infrastructure� Difficult to synchronise evolutions (e.g. data-link)� Blocks rapid progress� High capital expenditure and maintenance costs
� Book value approx. €6B (RDPS, FDPS, CWP, etc)� €2-3B annual costs
� Minimising the cost of Airborne equipment� How to ensure interoperability, synchronisation,
while minimising air/ground infrastructure cost and fostering innovation?� Industry standards, mandates� Leaving room for initiative, innovation� Balance is needed
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
15
Lower Airspace
Lower Airspace
FDP system suppliersAerotekhnikaBespokeCS SOFTIndraLockheed MartinNorthrop GrummanRaytheonSI ATMSelexThales
Key note briefing SID 2015
ANSP fragmentation, monopolies
� Airlines � Strong incentives for innovation with de-regulation � Learnt to minimise costs, adapt capacity to demand
� ANSPs� Designated by States, mostly monopolies� Fragmented service provision, infrastructure� 90% of ANS costs� Economic surplus: 10% in average, up to 20%
� Driving behaviours of providers, users� SES Performance/charging Regulations� Incentives, e.g. modulation of revenue?� Opening the market?
� Industrial organisation� A rich scientific corpus: Nobel prize (Jean Tirole)� Application to ANS
Key note briefing SID 2015 16
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
130
260
390
520
650
780
910
1 040
1 170
1 300
DS
NA
DF
S
Ae
na
NA
TS
(C
on
tin
en
tal)
EN
AV
DH
MI
Sk
yg
uid
e
Uk
SA
TS
E
Av
ino
r (C
on
tin
en
tal)
LFV
Au
stro
Co
ntr
ol
LVN
L
RO
MA
TS
A
Be
lgo
con
tro
l
HC
AA
PA
NSA
MU
AC
NA
V P
ort
ug
al
(Co
nti
ne
nta
l)
AN
S C
R
NA
VIA
IR
IAA
Hu
ng
aro
Co
ntr
ol
Cro
ati
a C
on
tro
l
BU
LAT
SA
SM
AT
SA
Fin
avi
a
LPS
DC
AC
Cy
pru
s
Slo
ven
ia C
on
tro
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Na
vig
aci
ja
LGS
Alb
con
tro
l
EA
NS
MA
TS
Mo
ldA
TS
A
M-N
AV
AR
MA
TS
M€
Gate-to-gate ATM/CNS provision costs (in M€) Cumulative share ATM/CNS provision costs
56.0% of total European
gate-to-gate ATM/CNS
provision costs
36.1% of total European gate-to-gate ATM/CNS
provision costs
7.9% of total European gate-to-gate ATM/CNS
provision costs
Employment
costs for
ATCOs in OPS
€2 442 M
Composite flight-
hours
18.2 M
ATCO in OPS
hours on duty
22.6 M
ATM/CNS
provision costs
€7 937 M
Support cost ratio
3.3
ATCO-hour
Productivity
0.81
ATCO employment
costs per ATCO-hour
€108
Financial
cost-effectiveness
indicator
€436
EUROCONTROL/PRU
Support costs
€5 495 M
Support costs per
unit of output
€302
ATCOs employment
costs per
unit of output
€134
ATCO productivity
� Average productivity (flight-hours/ATCO-hours) � Very low (0.8), less than 1 aircraft under control per ATCO on duty!� Improves slowly
� Ambitious targets in SESAR 2020: Innovation required!
17
0.73 0.78 0.80 0.80 0.81
0.0
0.2
0.4
0.6
0.8
1.0
2009 2010 2011 2012 2013
Co
mp
osi
te f
lig
ht-
ho
ur
pe
r A
TC
O-h
ou
r
on
du
ty
30%
70%
2013
Key note briefing SID 2015
Matching en-route capacity with demand
� ATC capacity tends to be very rigid� Better matching ATC capacity with demand
� Gaining on both capacity costs (charges) and delays� Impact on some €2.5B p.a.
� Addressing traffic variability
� More flexible en-route capacity� Flexible rostering (e.g. Maastricht UAC)� Virtual centres, Industrial partnerships � Business drivers (e.g. modulation of user charges, ANSP revenues, SATURN)� Innovation: new concepts, e.g. Flight-centric ATC
18
Sectors
Cap
acity
Offered
Unused CapacityUsed
Capacityshortfall
Delay costs
Time
2.2 B
0.8 B
2.0 B
3.5 B
0.8 B
TotalUser cost(ground)
€ 10.5 B
Flight-efficiencyEn-route: 1.0 BTMA, taxi: 1.2 B
ATFM DelaysER: 0.5, Apt: 0.3
ATCO
Other costsECTL, MET, NSA
UserCharges
€7.5 B
Estimated TEC 2012 (SES)
Support costsOther staff
Other operating
CAPEXDepreciation
Cost of capital1.2 B
Airborne ANS
Key note briefing SID 2015
New operational concepts
Time of day
Cap
acity
Offered
Used
� Flight-centric ATC � Separation responsibility allocated per flight, not per sector
� ATC load is more stable and predictable: much better use of resources� Capacity is much more scalable, not locked in small sector silos
� Full use of trajectory-based concept of SESAR� Flight-centric is trajectory based, makes full use of 4D� SESAR 1 concept perpetuates weaknesses associated with sectors,
does not use full 4D potential
� Other concepts: Room for innovation!
Sectors
Cap
acity
Offered
Unused CapacityUsed
Capacityshortfall
Delay costs
Time
19Key note briefing SID 2015
Flight-oriented view
P: Piloting, S: Separation
Current SESAR 1 Flight-centric
Delegatedseparation
RPAS
Sectors Flight-oriented view
Air P P P P P P P S
Ground S S S S S Flow, Police P S
20
� Flight-centric ATC � Both piloting and separation functions have flight-oriented view
� Separating own aircraft against all others
� Delegated separation � Piloting and separation both airborne, both flight-oriented view
� RPAS� Piloting and separation on the ground, both flight-oriented view
� Flight-oriented view • Would ease productivity, integration of RPAS, delegation of separation
Key note briefing SID 2015
RPAS
� Wide variety � From toys to high-end aircraft
� Big challenges and opportunities� Integration or segregation?� Mass market� R/F spectrum� etc
Key note briefing SID 2015 21
Efficient use of Radio Spectrum
� Aviation has significant radio spectrum allocations� VHF band (Voice, NAV, VDL)� L, S bands (Radar, DME, shared with military)� C band (MLS)
� High value, high demand for spectrum� High demand, e.g. 4G networks� A licence for a 5 MHz band in a large State can be worth some € 2B…
� Active spectrum management� Spectrum-efficient technology exists, but high retrofit costs for aviation� 8,33kHz, VDL2 are low efficiency, low capacity technologies� New Spectrum requirements, e.g. Data/Link, mainly RPAS
� Opportunity for use of new CNS technology � e.g. addressed COM for flight-centric
Key note briefing SID 2015 22
Key challenges and opportunities for innovation
• Improvements in performance, but much room for further improvements• Opportunities from crises, technology, …• A volatile world, high uncertainties• Safety: measuring, controlling risk• Enhanced environmental efficiency• Sequencing and TMA• Predictability of operations• Human factors, behaviours, culture� Deployment: Balance between standards/plans and innovation� Industrial organisation
� Research, Incentives, Partnerships, ANSP governance…
� Step change in productivity, flexibility � New concepts, e.g. flight-centric ATC� RPAS: mass market power� Spectrum efficient CNS, technology supporting new concepts
Key note briefing SID 2015 23
Conclusions
� Plenty of challenges and opportunities for innovation� Some hints
24Key note briefing SID 2015
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