Cost-efficiency - Romania

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PRB monitoring

▪ The en route 2023 actual unit cost of Romania was 33.98 €2017, -5.1% lower than the determined unit cost (35.80 €2017). The terminal 2023 actual unit cost was 299.92 €2017, +13% higher than the determined unit cost (265.95 €2017).

▪ The en route 2023 actual service units (5.9M) were +7.0% higher than the determined service units (5.5M).

▪ The en route 2023 actual total costs were +3.2 M€2017 (+1.6%) higher than determined. The primary factor driving the difference in total costs was an overspend in staff costs (+7.8 M€2017, or +5.3%), largely due to wage compensations awarded for higher than planned traffic and achieving the capacity target. The gap in staff costs was partially mitigated by an underspend in other operating costs (-4.0 M€2017, or -13%). The difference in other operating costs was mainly attributed to lower energy expenses and delays in both the training program and the contracting processes with third-party service providers.

▪ ROMATSA spent 19 M€2017 in 2023 related to costs of investments for both en route and terminal charging zones, -3.1% less than determined (20 M€2017), mainly due to delays in new investment projects.

▪ The en route actual unit cost incurred by users in 2023 was 44.07€ (+5.9% above the 2023 DUC), while the terminal actual unit cost incurred by users was 351.53€ (+12% above the 2023 DUC).

En route charging zone

Unit cost (KPI#1)

Actual and determined data
Total costs - nominal (M€) 2020-2021 2022 2023 2024
Actual costs 373 227 271 NA
Determined costs 370 219 249 265
Difference costs 2 8 22 NA
Inflation assumptions 2020-2021 2022 2023 2024
Determined inflation rate NA 9.3% 4.0% 3.0%
Determined inflation index NA 125.9 130.9 134.8
Actual inflation rate NA 12.0% 9.7% NA
Actual inflation index NA 129 141.5 NA
Difference inflation index (p.p.) NA +3.1 +10.6 NA

AUC vs. DUC

In 2023, the en route AUC was -5.1% (or -8.3 RON2017, -1.82 €2017) lower than the planned DUC. This results from the combination of significantly higher than planned TSUs (+7.0%) and higher than planned en route costs in real terms (+1.6%, or +14.5 MRON2017, +3.2 M€2017). It should be noted that the actual inflation index in 2023 was +10.6 p.p. higher than planned.

En route service units

The difference between 2023 actual and planned TSUs (+7.0%) 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 .

En route costs by entity

The 2023 actual real en route costs are +1.6% (+3.2 M€2017) higher than planned. This is the result of higher than planned costs for the main ANSP, ROMATSA (+1.0%, or +1.9 M€2017) and the NSA/EUROCONTROL (+10.5%, or +1.3 M€2017).

En route costs for the main ANSP at charging zone level

Higher than planned en route costs in real terms for ROMATSA in 2023 (+1.0%, or +1.9 M€2017) result from:
- Significantly higher than planned staff costs (+5.9%), reported to be mainly due to “compensation for the increase in inflation, exceeding the traffic forecast and meeting the capacity target, and as a result of the increase in pension costs”.
- Significantly lower than planned other operating costs (-28.4%), reported to be mainly due to “decrease in electricity costs and delays in the training program and contracting with third parties”,
- Depreciation costs in line with the performance plan (-0.005%),
- Significantly lower than planned cost of capital (-6.5%), reported to be mainly due to “delays in contract signatures for new investments as well as impediments in deliveries impacting negatively the Investment Plan for 2023”

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

AUCU components (€/SU) – 2023
Components of the AUCU in 2023 €/SU
DUC 41.61
Inflation adjustment 2.74
Cost exempt from cost-sharing 0.57
Traffic risk sharing adjustment -1.24
Traffic adj. (costs not TRS) -0.26
Finantial incentives 0.56
Modulation of charges 0.00
Cross-financing 0.00
Other revenues -0.08
Application of lower unit rate 0.00
Total adjustments 2.29
AUCU 43.89
AUCU vs. DUC + 5.5%
Cost exempt from cost sharing by item - 2023 €'000 €/SU
New and existing investments -306.0 -0.05
Competent authorities and qualified entities costs -611.2 -0.10
Eurocontrol costs 1,925.2 0.33
Pension costs 2,200.9 0.37
Interest on loans 173.2 0.03
Changes in law 0.0 0.00
Total cost exempt from cost risk sharing 3,382.0 0.57

The actual en route unit cost incurred by airspace users (AUCU) in respect of activities performed in 2023 (217.88 RON or 44.07 €) is +5.9% higher than the nominal DUC (205.70 RON or 41.61 €). The difference between these two figures (+12.19 RON/SU or +2.47 €/SU) is due to:
- the positive inflation adjustment resulting from higher than planned inflation (+13.55 RON/SU or +2.74 €/SU);
- the impact of adjustments resulting from the costs exempted from cost-sharing mechanism (+2.69 RON/SU or +0.54 €/SU);
- the deduction of the traffic risk sharing adjustments (-6.13 RON/SU or -1.24 €/SU);
- the deduction of the traffic adjustment (-1.30 RON/SU or -0.26 €/SU) for the costs not subject to traffic risk sharing;
- financial incentives (+3.66 RON/SU or +0.74 €/SU); and
- the deduction of the other revenues (-0.29 RON/SU or -0.06 €/SU).
The share of the regulatory result in the AUCU (before the deduction of other revenues) is 5.8%.

Regulatory result (RR)

ROMATSA net gain on activity in the Romania en route charging zone in the year 2023

ROMATSA reported a net gain of +54.3 MRON, as a combination of a loss of -3.5 MRON arising from the cost sharing mechanism, with a gain of +36.1 MRON arising from the traffic risk sharing mechanism and a gain of +21.7 MRON relating to financial incentives.

ROMATSA 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 (+54.3 MRON) and the actual RoE (+21.1 MRON) amounts to +75.4 MRON (6.1% of the en route revenues). The resulting ex-post rate of return on equity is 27.8%, which is much higher than the 7.8% planned in the PP.