Cost-efficiency - Estonia
PRB monitoring
▪ The en route 2024 actual unit cost of Estonia was 42.59€2017, +42% higher than the determined unit cost (29.97€2017). The terminal 2024 actual unit cost was 169.01€2017, +38% higher than the determined unit cost (122.71€2017).
▪ The en route 2024 actual service units (0.6M) were -39% lower than the determined service units (0.9M) mainly due to shifted traffic flows caused by Russia’s war of aggression against Ukraine.
▪ The en route 2024 actual total costs were -3.7M€2017 (-14%) lower than determined, with all cost categories registering lower-than-planned costs. The difference is mainly due to lower staff costs (-2.5M€2017, or -21%) for EANS. However, in nominal terms, the actual staff costs show an increase of +2.4% compared to the determined figures.
▪ EANS costs of investments were 4.9M€2017 in 2024 for both en route and terminal charging zones, -9.7% less than determined (5.4M€2017). According to the NSA, this reduction is due a decrease in depreciation costs following the postponement of new investments.
▪ The en route actual unit cost incurred by users in 2024 was 60.57€ (+87% above the 2024 DUC), while the terminal actual unit cost incurred by users was 130.40€ (-2.1% below the 2024 DUC). The difference between the AUCU and the DUC for the en route charging zone is primarily attributed to lower than planned service units.
▪ The en route regulatory result for EANS amounted to +4.9M€, or 19% of the 2024 revenue.
▪ Estonia should ensure that any excessive regulatory result, including excess funds received by the ANSP due to the inflation mechanism, is either reinvested to improve the quality of services delivered to airspace users or reimbursed to them.
En route charging zone
| Actual and determined data |
| Total costs - nominal (M€) |
2020-2021 |
2022 |
2023 |
2024 |
| Actual costs |
53 |
26 |
27 |
30 |
| Determined costs |
54 |
27 |
28 |
30 |
| Difference costs |
0 |
-1 |
-2 |
0 |
| Inflation assumptions |
2020-2021 |
2022 |
2023 |
2024 |
| Determined inflation rate |
NA |
2.5% |
2.1% |
1.9% |
| Determined inflation index |
NA |
110.4 |
112.7 |
114.8 |
| Actual inflation rate |
NA |
19.4% |
9.1% |
3.7% |
| Actual inflation index |
NA |
132 |
144 |
149.3 |
| Difference inflation index (p.p.) |
NA |
+21.6 |
+31.3 |
+34.5 |
AUC vs. DUC
In 2024, the en route AUC was +42.1% (or +12.62 €2017) higher than the planned DUC. This results from the combination of significantly lower than planned TSUs (-39.2%) and significantly lower than planned en route costs in real terms (-13.5%, or -3.7 M€2017). It should be noted that the actual inflation index in 2024 was +34.5 p.p. higher than planned.
En route service units
The difference between actual and planned TSUs (-39.2%) falls outside the ±10% threshold foreseen in the traffic risk sharing mechanism. The resulting loss of en route revenues is therefore shared between the ANSP and the airspace users (see the main ANSP loss in Box 11).
En route costs by entity
Actual real en route costs are -13.5% (-3.7 M€2017) lower than planned. This is the result of lower costs for the main ANSP, EANS (-22.0%, or -4.6 M€2017) and higher costs for the NSA/EUROCONTROL (+12.8%, or +0.9 M€2017).
En route costs for the main ANSP at charging zone level
Significantly lower than planned en route costs in real terms for EANS in 2024 (-22.0%, or -4.6 M€2017) result from:
- Significantly lower staff costs (-21.3%) in real terms due to the impact of higher than planned inflation index (+34.5 p.p.) since, in nominal terms, staff costs were above the plan (+2.4%),
- Significantly lower other operating costs (-21.1%) also reflecting the impact of inflation index as nominal costs slightly exceeded planned figures (+2.6%),
- Significantly lower depreciation (-28.2%) resulting from “unforeseen changes in actual investment costs of new investments due to a delayed/postponed implementation”,
- Significantly lower cost of capital (-16.8%) reflecting changes in the financing structure resulting in the share of financing through equity being much lower than planned.
RP3 summary
When considering the whole of RP3 (2020-2024) for Estonia en route charging zone, actual TSUs are -31.2% lower than planned, while actual costs in real terms are -9.1% lower than the determined costs (some -12.0 M€2017). As a result, the weighted average actual unit cost over RP3 (51.42 €2017) is +32.1% higher than planned in the PP (38.91 €2017).
Actual unit cost incurred by the users (AUCU) (PI#1)
| AUCU components (€/SU) – 2024 |
| Components of the AUCU in 2024 |
€/SU |
| DUC |
32.46 |
| Inflation adjustment |
9.54 |
| Cost exempt from cost-sharing |
-0.53 |
| Traffic risk sharing adjustment |
14.21 |
| Traffic adj. (costs not TRS) |
4.89 |
| 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 |
28.11 |
| AUCU |
60.57 |
| AUCU vs. DUC |
+ 86.6% |
| Cost exempt from cost sharing by item - 2024 |
€'000 |
€/SU |
| New and existing investments |
-1,144.0 |
-2.06 |
| Competent authorities and qualified entities costs |
1,073.6 |
1.93 |
| Eurocontrol costs |
-222.7 |
-0.40 |
| 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 |
-293.1 |
-0.53 |
The actual en route unit cost incurred by airspace users (AUCU) in respect of activities performed in 2024 (60.57 €) is +86.6% higher than the nominal DUC (32.46 €). The difference between these two figures (+28.11 €/SU) is due to:
- the positive inflation adjustment resulting from higher than planned inflation (+9.54 €/SU);
- the impact of adjustments resulting from the costs exempted from cost sharing mechanism (-0.53 €/SU);
- the addition of the traffic risk sharing adjustments (+14.21 €/SU); and
- the addition of the traffic adjustment (+4.89 €/SU) for the costs not subject to traffic risk sharing.
The share of the regulatory result (see items 10 to 13) in the AUCU (before the deduction of other revenues) is 14.7%.
EANS net gain/loss on activity in the Estonia en route charging zone in the year 2024
EANS reported a net gain of +4.0 M€, as a combination of a gain of +5.0 M€ arising from the cost sharing mechanism, with a loss of -1.0 M€ arising from the traffic risk sharing mechanism.
EANS 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 (+4.0 M€) and the actual RoE (+0.9 M€) amounts to +4.9 M€ (18.9% of the en route revenues). The resulting ex-post rate of return on equity is 39.4%, which is higher than the 7.3% planned in the PP.
RP3 summary
When considering the whole of RP3 (2020-2024), EANS generated a cumulative gain in respect of cost sharing of +14.5 M€, as actual total costs for RP3 were lower than planned. The traffic risk sharing mechanism generated loss of -1.9 M€. Adding the actual RoE (+4.9 M€ over RP3) leads to an overall regulatory result of +17.5 M€, which corresponds to an average ex-post return on equity of 25.9% (compared to 7.3% initially planned in the PP).