Cost-efficiency - Poland

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Terminal charging zone - Poland EPWA

Unit cost (KPI#1)

Actual and determined data
Total costs - nominal (M€) 2020-2021 2022 2023 2024
Actual costs 16 12 15 NA
Determined costs 19 11 12 12
Difference costs −3 1 3 NA
Inflation assumptions 2020-2021 2022 2023 2024
Determined inflation rate NA 2.5% 2.5% 2.5%
Determined inflation index NA 113.4 116.2 119.1
Actual inflation rate NA 13.2% 10.9% NA
Actual inflation index NA 127.6 141.5 NA
Difference inflation index (p.p.) NA +14.2 +25.3 NA

AUC vs. DUC

In 2023, the terminal AUC was +2.5% (or +11.56 PLN2017, +2.72 €2017) higher than the planned DUC. This results from the combination of higher than planned terminal costs in real terms (+4.9%, or +2.2 MPLN2017, +0.5 M€2017) and higher than planned TNSUs (+2.3%). It should be noted that actual inflation index in 2023 was +25.3 p.p. higher than planned.

Terminal service units

The difference between actual and planned TNSUs (+2.3%) 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 ANSP and the airspace users .

Terminal costs by entity

Actual real terminal costs are +4.9% (+0.5 M€2017) higher than planned. This is the result of higher costs for the main ANSP, PANSA (+4.4%, or +0.4 M€2017) and the NSA (+51.0%, or +0.1 M€2017) and lower costs for the MET service provider (-14.0%, or -0.05 M€2017).

Terminal costs for the main ANSP at charging zone level

Higher than planned terminal costs in real terms for PANSA in 2023 (+4.4%, or +0.4 M€2017) result from:
- Significantly higher staff costs in real terms (+12.9%) and nominal terms (+37.4%), driven by significant increase in inflation rates; these costs reflect mainly obligations of PANSA towards its employees based on the current remuneration scheme reflecting inflation compensation payments calculated for 2022 and 2023;
- Significantly lower other operating costs in real terms (-22.1%) and nominal terms (5.1%), driven by cost reductions, which more than offset the increase in energy costs due to higher energy prices.
- Lower depreciation (-2.8%), mainly “uncertainty from global crises and the war in Ukraine, which led to the postponement or review of some projects.”;
- Lower cost of capital (-2.9%), mainly due to a lower asset base, despite a higher WACC rate caused by a substantial increase in the annual interest rate on debt and rising WIBOR reference rates.

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

AUCU components (€/SU) – 2023
Components of the AUCU in 2023 €/SU
DUC 114.42
Inflation adjustment 20.30
Cost exempt from cost-sharing 0.69
Traffic risk sharing adjustment −0.24
Traffic adj. (costs not TRS) −0.15
Finantial incentives 2.11
Modulation of charges 0.00
Cross-financing 0.00
Other revenues −2.38
Application of lower unit rate 0.00
Total adjustments 20.32
AUCU 134.74
AUCU vs. DUC +17.8%
Cost exempt from cost sharing by item - 2023 €'000 €/SU
New and existing investments −67.8 −0.69
Competent authorities and qualified entities costs 124.3 1.26
Eurocontrol costs 0.0 0.00
Pension costs 0.0 0.00
Interest on loans 11.3 0.11
Changes in law 0.0 0.00
Total cost exempt from cost risk sharing 67.8 0.69

The actual terminal unit cost incurred by airspace users (AUCU) in respect of activities performed in 2023 (611.45 PLN or 134.74 €) is +17.8% higher than the nominal DUC (519.24 PLN or 114.42 €). The difference between these two figures (+92.22 PLN/SU or +20.32 €/SU) is due to:
- the positive inflation adjustment resulting from higher than planned inflation (+92.10 PLN/SU or +20.30 €/SU);
- the impact of adjustments resulting from the costs exempted from cost-sharing mechanism (+3.11 PLN/SU or +0.69 €/SU);
- the deduction of the traffic risk sharing adjustments (-1.08 PLN/SU or -0.24 €/SU);
- the deduction of the traffic adjustment (-0.67 PLN/SU or -0.15 €/SU) for the costs not subject to traffic risk sharing;
- financial incentives (+9.57 PLN/SU or +2.11 €/SU); and
- the deduction of the other revenues (-10.82 PLN/SU or -2.38 €/SU).
The share of the regulatory result in the AUCU (before the deduction of other revenues) is 1.9%.

Regulatory result (RR)

PANSA net gain on activity in the Poland terminal charging zone 1 in the year 2023

PANSA reported a net loss of -1.0 MPLN, as a combination of a loss of -2.9 MPLN arising from the cost sharing mechanism, with a gain of +1.0 MPLN arising from the traffic risk sharing mechanism and a gain of +0.9 MPLN relating to financial incentives.

PANSA overall regulatory results (RR) for the terminal charging zone 1 activity

Ex-post, the overall RR taking into account the net loss from the terminal activity mentioned above (-1.0 MPLN) and the actual RoE (+1.8 MPLN) amounts to +0.9 MPLN (1.5% of the terminal revenues). The resulting ex-post rate of return on equity is 2.4%, which is lower than the 5.1% planned in the PP.