Cost-efficiency - Spain

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PRB monitoring

▪ The en route 2020/2021 actual unit cost of Spain Continental was 105.84 €2017, -1.7% lower than the determined unit cost (107.71 €2017). The en route 2020/2021 actual unit cost of Spain Canarias was 99.65 €2017, -5.1% lower than the determined unit cost (104.97 €2017).

▪ The terminal 2020/2021 actual unit cost of Spain was 221.77 €2017, -3.8% lower than the determined unit cost (230.44 €2017).

▪ The en route 2021 actual service units of Spain Continental (6,383K) were in line with the determined (6,370K). The en route 2021 actual service units of Spain Canarias (1,008K) were +6.1% higher than the determined (950K).

▪ In 2021, Spain Continental decreased total costs by -19 M€2017 (-3.3%) compared to determined costs. All cost categories decreased, except depreciation costs. The decrease was mainly due to staff (-11 M€2017, or -3.0%) and other operating costs (-7.3 M€2017, or -7.7%) in ENAIRE. The NSA explained that budgetary limitations and a restrictive expenditure policy have still been applied in 2021.

▪ In 2021, Spain Canarias decreased total costs by -3.6 M€2017 (-3.9%) compared to determined costs. As for Spain Continental, all cost categories have decreased, except depreciation costs. The NSA provided the same explanations as for Spain Continental, since the variations are mainly attributable to ENAIRE.

▪ ENAIRE spent 112 M€2017 in 2021 related to costs of investments, -1.0% less than determined (113 M€2017). The difference was due to a combination of lower en route depreciation costs attributable to a delay in investments (due to the COVID-19 pandemic), and slightly lower than planned terminal cost of capital induced by a lower net book value and WACC.

▪ The en route Spain Continental actual unit cost incurred by users in 2020/2021 was 112.68€, while the en route Spain Canarias actual unit cost incurred by users was 87.05€. The terminal actual unit cost incurred by users was 58.80€.

En route charging zone - Spain Continental

Unit cost (KPI#1)

Actual and determined data
Total costs - nominal (M€) 2020-2021 2022 2023 2024
Actual costs 1,180 NA NA NA
Determined costs 1,191 622 630 634
Difference costs -11 NA NA NA
Inflation assumptions 2020-2021 2022 2023 2024
Determined inflation rate NA 1.3% 1.5% 1.6%
Determined inflation index NA 104.9 106.5 108.2
Actual inflation rate NA NA NA NA
Actual inflation index NA NA NA NA
Difference inflation index (p.p.) NA NA NA NA

AUC vs. DUC

In the combined year 2020-2021, the AUC was lower than the planned DUC (by -1.7%, or -1.87€2017). This results from the combination of slightly higher than planned TSUs (+0.1%) and lower than planned en route costs in real terms (by -1.6%, or -18.8 M€2017).

En route service units

The difference between actual and planned TSUs (+0.1) falls within the ±2% dead band. Hence the resulting additional revenue is kept by the ANSPs.

En route costs by entity

Actual real en route costs for 2020-2021 are -1.6% (-18.8 M€2017) lower than planned. This result is driven by the main ANSP, ENAIRE (-1.8%, or -17.9 M€2017), the MET service provider (-0.4% or -0.2 M€2017) and the NSA/EUROCONTROL costs (-3.8%, or -2.9 M€2017), whereas other ANSPs cost are higher than planed (+4.9% or +2.2 M€2017).

En route costs for the main ANSP at charging zone level

Lower then planned en route costs in real terms for ENAIRE in 2020-2021 (-1.8%, or -17.9 M€2017 lower) results from:
- lower staff costs (-1.5%), although the additional information to the en route reporting tables clarify that “two provisional rulings unfavourable to ENAIRE, as a consequence of claims of control staff, have impacted in 2021 Annual Accounts for ENAIRE, with a total amount of 32.2M€ higher salaries. This mentioned total amount, although included as higher staff expenses in the 2021 ENAIRE Accounts, has not been considered in the costs submitted by ENAIRE pending national Supreme Court final rulings”;
- lower other operating costs (-6.6%), as result of restrictive expenditure policy;
- slightly higher depreciation (+0.3%);
- lower cost of capital (-3.2%), due to lower asset base (-1.6%) and WACC.

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

AUCU components (€/SU) – 2020-2021
Components of the AUCU in 2020-2021 €/SU
DUC 110.16
Inflation adjustment 0.81
Cost exempt from cost-sharing -0.25
Traffic risk sharing adjustment 0.00
Traffic adj. (costs not TRS) -0.02
Finantial incentives 0.00
Modulation of charges 0.00
Cross-financing 3.15
Other revenues -1.13
Application of lower unit rate 0.00
Total adjustments 2.56
AUCU 112.72
AUCU vs. DUC + 2.3%
Cost exempt from cost sharing by item - 2020-2021 €'000 €/SU
New and existing investments 218.2 0.02
Competent authorities and qualified entities costs -391.9 -0.04
Eurocontrol costs -2,492.9 -0.23
Pension costs 0.0 0.00
Interest on loans 0.0 0.00
Changes in law 0.0 0.00
Total cost exempt from cost risk sharing -2,666.7 -0.25

The actual en route unit cost incurred by airspace users (AUCU) in respect of activities performed in combined year 2020-2021 for Spain Continental en route charging zone (112.68€) is +2.3% higher than the nominal DUC (110.16€) which includes DUC initially charged: 54.45€; and to be charged: 55.71€. The difference between these two figures (+2.51€/SU) is due to:
- cross-financing Spain Canarias (+3.15/SU);
- the positive inflation adjustment resulting from higher than planned inflation (+0.81€/SU);
- the deduction of the traffic adjustment (-0.02€/SU) for the costs not subject to traffic risk sharing to be reimbursed in future years;
- the deduction of the other revenues (-1.13€/SU);
- and the impact of adjustments resulting from the costs exempted from cost-sharing mechanism (-0.29€/SU).
The share of regulatory result in the AUCU is 5.2%.

Regulatory result (RR)

ENAIRE net gain on en route activity in the Spain Continental charging zone in the combined year 2020-2021
ENAIRE’s net gain amounts to +19.6 M€, as a combination of a gain of +18.4 M€ arising from the cost sharing mechanism and a gain of +1.2 M€ arising from the traffic risk sharing mechanism.
ENAIRE overall regulatory results (RR) for the en route activity
Ex-post, the overall RR taking into account the net gain from the en route activity mentioned above (+19.6 M€) and the actual RoE (+42.6 M€) amounts to +62.2 M€ (6.1% of the en route revenues). The resulting ex-post rate of return on equity is 9.8%, which is higher than the 6.7% planned in the PP.