Cost-efficiency - Austria

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PRB monitoring

▪ Actual en route service units (3,248K) in 2022 were 8.1% higher than the determined service units (3,004K).

▪ Total actual en route costs in 2022 were 1.7 M€2017 (-0.9%) lower than determined. The increase in staff costs (+3.5 M€2017, or +2.8%) compared to determined was offset by decreases in all the other cost categories.

▪ The main decreases were attributable to depreciation costs (-2.0 M€2017, or -9.1%) and cost of capital (-1.4 M€2017, or -26%). The NSA noted that it is mainly due to delayed investments as a result of the prolonged COVID-19 situation.

▪ Austro Control spent 29 M€2017 in 2022 related to costs of investments, 13% less than determined (33 M€2017), due to delayed investment as a result of the prolonged COVID-19 situation.

▪ As for the previous monitoring year, the discrepancies regarding costs of investments were significant. The PRB invites the NSA to analyse the discrepancies, identify their reasons, and the Member State to take immediate, adequate, and proportionate action to ensure the implementation of the investment plans to avoid future capacity gaps.

▪ Actual en route unit cost in 2022 of Austria was 56.91 €2017, 8.3% lower than the determined unit cost (62.09 €2017). Actual terminal unit cost in 2022 was 267.42 €2017, 20% higher than the determined unit cost (223.52 €2017).

▪ Actual en route unit cost incurred by users in 2022 was 67.45€, while the actual terminal unit cost incurred by users was 301.37€.

En route charging zone

Unit cost (KPI#1)

Actual and determined data
Total costs - nominal (M€) 2020-2021 2022 2023 2024
Actual costs 363 211 NA NA
Determined costs 381 202 196 196
Difference costs −17 9 NA NA
Inflation assumptions 2020-2021 2022 2023 2024
Determined inflation rate NA 2.5% 2.0% 2.0%
Determined inflation index NA 110.3 112.5 114.8
Actual inflation rate NA 8.6% NA NA
Actual inflation index NA 117.3 NA NA
Difference inflation index (p.p.) NA +7 NA NA

AUC vs. DUC

In 2022, the en route AUC was -8.3% (or -5.18 €2017) lower than the planned DUC. This results from the combination of significantly higher than planned TSUs (+8.1%) and slightly lower than planned en route costs in real terms (-0.9%, or -1.7 M€2017). It should be noted that actual inflation index in 2022 was +7.0 p.p. higher than planned.

En route service units

The difference between actual and planned TSUs (+8.1%) 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 en route revenues is therefore shared between the ANSP and the airspace users, with the ANSP (Austro Control) retaining an amount of +5.8 M€2017.

En route costs by entity

Actual real en route costs are -0.9% (-1.7 M€2017) lower than planned. This is the result of lower costs for the MET service provider (-14.0%, or -1.7 M€2017) and the NSA/EUROCONTROL (-1.7%, or -0.2 M€2017) and higher costs for the main ANSP, Austro Control (+0.1%, or +0.2 M€2017).

En route costs for the main ANSP at charging zone level

Slightly higher than planned en route costs in real terms for Austro Control in 2022 (+0.1%, or +0.2 M€2017) result from:
- Higher staff costs (+3.8%), due to overtime hours to cope with the increase in traffic, impact of the inflation on salaries and the higher pension costs than determined;
- Lower other operating costs (-4.7%), mainly due to the inflation index impact (+7.0 p.p.) since in nominal terms the costs are just slightly higher than planned (+1.4%);
- Lower depreciation (-9.3%), reflecting delays in investments due to the impact of COVID-19;
- Significantly lower cost of capital (-25.6%) reflecting delayed investments and “short-term financing conditions of the Republic of Austria, due to which the average net working capital was subject to interest at 0% in 2021”
- Lower exceptional costs (-6.0%), due to the inflation index (+7.0 p.p.) since in nominal terms the actual costs are equal to determined; and,
- Lower deduction for VFR exempted flights (-6.6%).

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

AUCU components (€/SU) – 2022
Components of the AUCU in 2022 €/SU
DUC 67.16
Inflation adjustment 3.20
Cost exempt from cost-sharing −0.30
Traffic risk sharing adjustment −2.34
Traffic adj. (costs not TRS) −0.62
Finantial incentives 0.00
Modulation of charges 0.00
Cross-financing 0.00
Other revenues 0.00
Application of lower unit rate 0.00
Total adjustments −0.06
AUCU 67.10
AUCU vs. DUC −0.1%
Cost exempt from cost sharing by item - 2022 €'000 €/SU
New and existing investments −3,319.0 −1.02
Competent authorities and qualified entities costs −352.4 −0.11
Eurocontrol costs 293.9 0.09
Pension costs 2,392.6 0.74
Interest on loans 0.0 0.00
Changes in law 0.0 0.00
Total cost exempt from cost risk sharing −984.9 −0.30

The actual en route unit cost incurred by airspace users (AUCU) in respect of activities performed in 2022 (67.45 €) is +0.4% higher than the nominal DUC (67.16 €). The difference between these two figures (+0.29 €/SU) is due to:
- the positive inflation adjustment resulting from higher than planned inflation (+3.20 €/SU);
- the impact of adjustments resulting from the costs exempted from cost-sharing mechanism (+0.04 €/SU);
- the deduction of the traffic risk sharing adjustments (-2.34 €/SU); and
- the deduction of the traffic adjustment (-0.62 €/SU) for the costs not subject to traffic risk sharing.
The share of the regulatory result in the AUCU (before the deduction of other revenues) is 4.3%.

Regulatory result (RR)

Austro Control net gain on activity in the Austria en route charging zone in the year 2022

Austro Control reported a net gain of +5.7 M€, as a combination of a loss of -1.1 M€ arising from the cost sharing mechanism, with a gain of +6.8 M€ arising from the traffic risk sharing mechanism.

Austro Control overall regulatory result (RR) for the en route activity

Ex-post, the overall RR taking into account the net gain from the en route activity mentioned above (+5.7 M€) and the actual RoE (+1.1 M€) amounts to +6.7 M€ (3.5% of the en route revenues). The resulting ex-post rate of return on equity is 46.3%, which is higher than the 7.3% planned in the PP.

Note 1: Ex-ante and ex-post RoE are computed based on the notional gearing of 85% debt used in the Performance Plan for RP3. The actual gearing of Austro Control should be reported.
Note 2: The analysis presented excludes MET services of Austro Control since MET data are disclosed separately in en route and terminal reporting tables.