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        • Regulatory Result

    Cost-efficiency - Denmark

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    Terminal charging zone

    Unit cost (KPI#1)

    Actual and determined data
    Total costs - nominal (M€) 2020-2021 2022 2023 2024
    Actual costs 48 NA NA NA
    Determined costs 48 24 25 25
    Difference costs 0 NA NA NA
    Inflation assumptions 2020-2021 2022 2023 2024
    Determined inflation rate NA 1.4% 1.5% 1.6%
    Determined inflation index NA 104.2 105.7 107.4
    Actual inflation rate NA NA NA NA
    Actual inflation index NA NA NA NA
    Difference inflation index (p.p.) NA NA NA NA
    Focus on unit cost

    AUC vs. DUC

    In the combined year 2020-2021, the terminal AUC was -2.4% (or -62.74DKK2017, or -8.44€2017) lower than the planned DUC. This results from the combination of higher than planned TNSUs (+2.2%) and lower than planned terminal costs in real terms (-0.3%, or -0.9 MDKK2017, or -0.1 M€2017).

    Terminal service units

    The difference between actual and planned TNSUs (+2.2%) falls outside the ±2% dead band, but does not exceed the ±10% threshold foreseen in the traffic risk sharing mechanism. The resulting gain of additional terminal revenues is therefore shared between the ATSP and the airspace users, with the ATSP (NAVIAIR) retaining an amount of +7.0 MDKK2017.

    Terminal costs by entity

    Actual real terminal costs are -0.3% (-0.9 MDKK2017, or -0.1 M€2017) lower than planned. This is driven by the main ANSP, NAVIAIR (-0.2%, or -0.1 M€2017) and the MET service provider (-4.6%, or -0.02 M€2017).

    Terminal costs for the main ANSP at charging zone level

    The lower than planned terminal costs in real terms for NAVIAIR (-0.2%, or -0.1 M€2017) result from:
    - higher staff costs (+1.1%), “mainly driven by costs for extra shifts primarily driven by COVID-related absence;”
    - lower other operating costs (-4.0%), “driven by low travel expenses, lower costs on administrative IT, and on fewer costs for training, e.g. COVID-related delays;”
    - slightly higher depreciation (+0.2%);
    - lower cost of capital (-5.7%), due to “fewer costs of debt related to lower renegotiated interest on subordinated loan;”
    - lower deduction as exceptional costs (-5.7%, as amounts are negative it reflects an increase of total costs), due to no deduction in 2021 actuals.

    Actual unit cost incurred by the users (AUCU) (PI#1)

    AUCU components (€/SU) – 2020-2021
    Components of the AUCU in 2020-2021 €/SU
    DUC 361.53
    Inflation adjustment 1.18
    Cost exempt from cost-sharing −1.21
    Traffic risk sharing adjustment −0.43
    Traffic adj. (costs not TRS) −0.07
    Finantial incentives 0.00
    Modulation of charges 0.00
    Cross-financing 0.00
    Other revenues −1.82
    Application of lower unit rate 0.00
    Total adjustments −2.35
    AUCU 359.18
    AUCU vs. DUC −0.6%
    Cost exempt from cost sharing by item - 2020-2021 €'000 €/SU
    New and existing investments −163.8 −1.20
    Competent authorities and qualified entities costs 0.0 0.00
    Eurocontrol costs 0.0 0.00
    Pension costs −1.1 −0.01
    Interest on loans 0.0 0.00
    Changes in law 0.0 0.00
    Total cost exempt from cost risk sharing −164.9 −1.21
    Focus on AUCU

    The actual terminal unit cost incurred by airspace users (AUCU) in respect of activities performed in combined year 2020-2021 for Denmark terminal charging zone (2 682.70DKK or 360.39€) is -0.3% lower than the nominal DUC (2,691.15DKK or 361.53€) which includes DUC initially charged: 1,113.77DKK (or 149.63€); and to be charged: 1,577.38DKK (or 211.90€). The difference between these two figures (-8.45DKK/SU or -1.13€/SU) is due to:
    - the positive inflation adjustment resulting from higher than planned inflation (+8.76DKK/SU or +1.18€/SU);
    - the deduction of the traffic risk sharing adjustments (-3.18DKK/SU or -0.43€/SU) and the traffic adjustment (-0.49DKK/SU or -0.07€/SU) for the costs not subject to traffic risk sharing to be reimbursed in future years;
    - the deduction of the other revenues (-13.54DKK/SU or -1.82€/SU).

    The share of regulatory result in the terminal AUCU is 8.2%.

    Regulatory result (RR)

    Focus on regulatory result

    NAVIAIR net gain on terminal activity in the Denmark charging zone in the combined year 2020-2021
    NAVIAIR reported a net gain of +1.1 M€, as a combination of a gain of +0.1 M€ arising from the cost sharing mechanism and a loss of -1.0 M€ arising from the traffic risk sharing mechanism.
    NAVIAIR overall regulatory results (RR) for the terminal activity
    Ex-post, the overall RR taking into account the net gain from the terminal activity mentioned above (+1.1 M€) and the actual RoE (+3.0 M€) amounts to 4.0 M€ (8.3% of the terminal revenues). The resulting ex-post rate of return on equity is 6.8%.

     
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