enav.it

1. Channelling Finance and Innovation to Industry Steps towards the Air Traffic Management system modernisation enav.it

2. Air transport in the European Union • The European Common Transport policy has been provided for since the Treaty of Rome (1957) • Air transport is fundamental to promote and secure the four freedoms which are the core of EU economic and social policy (in particular the free movement of goods and persons): • air transport facilitates mobility both within Europe and with the rest of the world while bringing significant societal benefits, for example in providing connectivity to remote and peripheral regions • air transport is a sine qua non to strengthen and consolidate the European identity • air transport is an important enabler of economic growth and a significant generator of jobs and technological innovation, helping Europe work towards the Lisbon goals • 4 million jobs in Europe (direct, indirect and induced), and this number is estimated to rise by as much as 1.5 million by 2020

3. Air Traffic Management (ATM) dimension in Europe The ANSPs (Air Navigation Service Providers) are the companies that provide air traffic control on behalf of a State The ANSPs objective is that aircraft are safely guided in the skies and on the ground, separating the aircrafts to prevent collisions, organizing and planning the flow of traffic, and providing information and other support for pilots • The European ATM Infrastructure is the fundamental enabler for Air Transport: • 33.000 flights on busy days in Europe • one of the best safety records in the world

4. Why the ATM infrastructure has to be modernised • The current ATM system is insufficient to face the expected increased complexity and density of air traffic: • fragmentation (routes design, technology, economic efficiency) • risk of a “capacity crunch” • the annual cost of delay for Europe sums to €1.5 billion a year and it will grow rapidly in the future in case no action is taken • The modernisation of the ATM infrastructure is essential to cope with the expected European economic recovery • It is in itself an enabler to launch economic recovery • The actual crisis should be seen as an opportunity to modernise ATM infrastructure

5. SESAR (Single European Sky ATM Research Program) • The SESAR is the EU initiative to modernise the ATM infrastructure • Its ultimate goal is to ensure sustainable air transport development in Europe in a safe and efficient manner through a performance-driven approach. • The key performance targets are: • enabling a three-fold increase in capacity • improving safety by a factor of 10 • cutting ATM costs by 50 % • reducing by 10 % the environmental impact per flight • 125-155 KTonnes of CO2 per year • plus the reduction on ground delays (at a typical major hub airport this could ideally remove 44% of ground emissions) • drastic reduction of noise nuisance to airport local communities

6. The Deploymentof the SESAR Program (2014-2020) The deployment of SESAR is large-scale production, procurement and implementation of the new ATM infrastructure and of the corresponding aircraft equipment The investments needed to deploy SESAR are in the range of € 30 billion • Economic impact: • € 419 billion on GDP over the period 2020 2030 • 2 basis points of the yearly expected economic growth • Important effort is needed to introduce the necessary governance mechanisms and financial tools to achieve a successful deployment of SESAR: • A single deployment governance composed by the major investors of the sector, namely ANSPs, Airlines and Airports, to coordinate and synchronise the SESAR deployment • The financial engineering is an essential tool to support the numerous investors of the sector

7. Funding and financing The effective and timely deployment of SESAR requires the definition of a clear funding and financing strategy • It is supposed that ~ € 3 billion will be funded by the European Commission • The identification of suitable funding and financing mechanisms, including innovative instruments, sources and schemes, is needed to fully support the deployment Possible Financial engineering for SESAR Deployment ILLUSTRATIVE Project Bonds Cohesion Funds Connecting Europe Facility Structural Funds Structured Finance Facility Other instruments / sources European Investment Bank loans

8. The modernisation of the European ATM infrastructure is key to boost the European economic growth in the next decades • At the same time, its failure will have a negative impact on the whole air transport and its industry and will threaten economic recovery in Europe • The achievement of the European ATM modernisation process relies on the successful deployment of the SESAR Programme • This challenge requires a significant involvement of relevant industrial and institutional stakeholders combined with a EU-wide financial effort • The complex financial engineering of the Programme asks for the establishment of rules and policies that allow the implementation of innovative financial schemes, such as project bonds, also in terms of coordination and synchronisation with the technical deployment of the Programme Conclusions The SESAR Deployment is a specific example where the European Institutions can bring real added value to Europe SESAR Deployment can become the model for all other European infrastructures, thus enabling the achievement of a competitive and sustainable European infrastructure modernization for all modes