Cost-efficiency - Portugal

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Terminal charging zone

Unit cost (KPI#1)

Actual and determined data
Total costs - nominal (M€) 2020-2021 2022 2023 2024
Actual costs 69 38 45 47
Determined costs 68 39 42 44
Difference costs 1 -1 3 3
Inflation assumptions 2020-2021 2022 2023 2024
Determined inflation rate NA 1.2% 1.3% 1.4%
Determined inflation index NA 103.6 104.9 106.4
Actual inflation rate NA 8.1% 5.3% 2.7%
Actual inflation index NA 110.7 116.6 119.7
Difference inflation index (p.p.) NA +7.1 +11.7 +13.4

AUC vs. DUC

In 2024, the terminal AUC was -15.8% (or -22.96 €2017) lower than the planned DUC. This results from the combination of significantly higher than planned TNSUs (+14.2%) and lower than planned terminal costs in real terms (-3.9%, or -1.6 M€2017). It should be noted that the actual inflation index in 2024 was +13.4 p.p. higher than planned.

Terminal service units

The difference between actual and planned TNSUs (+14.2%) falls outside 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 (see the main ANSP gain in Box 11).

Terminal costs by entity

Actual real terminal costs are -3.9% (-1.6 M€2017) lower than planned. This is the result of lower costs for the main ANSP, NAV Portugal (-3.5%, or -1.4 M€2017), the MET service provider (-14.4%, or -0.2 M€2017) and the NSA (-13.4%, or -0.1 M€2017).

Terminal costs for the main ANSP at charging zone level

Lower than planned terminal costs in real terms for NAV Portugal in 2024 (-3.5%, or -1.4 M€2017) result from:
- Slightly lower staff costs (-0.5%), due to the impact of inflation index (+13.4 p.p.) since, in nominal terms, staff costs, were above planned by +12.0%, despite lower annual defined benefit pension costs than expected,
- Significantly lower other operating costs (-6.4%), due to the impact of inflation index since, in nominal terms, other operating costs were higher than planned (+5.4%),
- Significantly lower depreciation (-14.4%), due to the postponement of a few projects,
- Significantly lower cost of capital (-56.2%), due to lower net book value of fixed assets.

RP3 summary

When considering the whole of RP3 (2020-2024) for Portugal Continental terminal charging zone, actual TNSUs are +11.5% higher than planned, while actual costs in real terms are -2.8% lower than the determined costs (some -5.2 M€2017). As a result, the weighted average actual unit cost over RP3 (149.77 €2017) is -12.8% lower than planned in the PP (171.77 €2017).

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

AUCU components (€/SU) – 2024
Components of the AUCU in 2024 €/SU
DUC 152.92
Inflation adjustment 14.72
Cost exempt from cost-sharing -6.51
Traffic risk sharing adjustment -12.47
Traffic adj. (costs not TRS) -0.87
Finantial incentives -0.39
Modulation of charges 0.00
Cross-financing 0.00
Other revenues 0.00
Application of lower unit rate 0.00
Total adjustments -5.51
AUCU 147.40
AUCU vs. DUC -3.6%
Cost exempt from cost sharing by item - 2024 €'000 €/SU
New and existing investments -1,236.1 -3.77
Competent authorities and qualified entities costs -49.3 -0.15
Eurocontrol costs 0.0 0.00
Pension costs -851.0 -2.59
Interest on loans 0.0 0.00
Changes in law 0.0 0.00
Total cost exempt from cost risk sharing -2,136.4 -6.51

The actual terminal unit cost incurred by airspace users (AUCU) in respect of activities performed in 2024 (147.40 €) is -3.6% lower than the nominal DUC (152.92 €). The difference between these two figures (-5.51 €/SU) is due to:
- the positive inflation adjustment resulting from higher than planned inflation (+14.72 €/SU);
- the impact of adjustments resulting from the costs exempted from cost sharing mechanism (-6.51 €/SU);
- the deduction of the traffic risk sharing adjustments (-12.47 €/SU);
- the deduction of the traffic adjustment (-0.87 €/SU) for the costs not subject to traffic risk sharing; and
- financial incentives (-0.39 €/SU).
The share of the regulatory result (see items 10 to 14) in the AUCU (before the deduction of other revenues) is 3.4%.

Regulatory result (RR)

NAV Portugal net gain/loss on activity in the Portugal terminal charging zone in the year 2024

NAV Portugal reported a net gain of +1.3 M€, as a combination of a loss of -0.5 M€ arising from the cost sharing mechanism, with a gain of +1.8 M€ arising from the traffic risk sharing mechanism and a loss of -0.1 M€ relating to financial incentives.

NAV Portugal overall regulatory result (RR) for the terminal activity

Ex-post, the overall RR taking into account the net gain from the terminal activity mentioned above (+1.3 M€) and the actual RoE (+0.3 M€) amounts to +1.6 M€ (3.4% of the terminal revenues). The resulting ex-post rate of return on equity is 19.9%, which is higher than the 4.2% planned in the PP.

RP3 summary

When considering the whole of RP3 (2020-2024), NAV Portugal generated a cumulative loss in respect of cost sharing of -0.4 M€, as actual total costs for RP3 were higher than planned. The traffic risk sharing mechanism generated gain of +6.4 M€. Adding the gain of +0.1 M€ to be retained by the ATSP in respect of financial incentives and the actual RoE (+2.6 M€ over RP3) leads to an overall regulatory result of +8.7 M€, which corresponds to an average ex-post return on equity of 17.2% (compared to 4.8% initially planned in the PP).