Supply Chain Management

Concepts for More Sustainable Air Traffic Management

How better capacity planning and air traffic management charging can substantially reduce flight emissions in Europe

With the media giving most of its attention to sustainable aviation fuels and hydrogen-powered aircraft, designing a more efficient air traffic management system is an often-overlooked way of reducing flight emissions. Researchers at WHU – Otto Beisheim School of Management modeled and tested two promising air traffic management concepts that may reduce emissions from flight detours by almost 50%.

Aviation accounts for around 4% of all anthropogenic (i.e., man-made) greenhouse gas emissions in Europe. In order to achieve a 90% reduction in aviation emissions by 2050, the European Commission has proposed a set of measures ranging from the use of more fuel-efficient aircraft to the development of sustainable aviation fuels (SAFs) and improved air traffic management (ATM).  ATM is concerned with ensuring a safe passage for all planes as they move through an airspace, and this requires air traffic controllers to monitor flights closely and direct them accurately. In an ideal world, every flight would be able to fly the shortest route (by distance) between its starting point and destination. However, particularly in Europe, there are at least two reasons why this is not always the case:

  1.  Many flights get redirected from their shortest route due to insufficient capacity (i.e., a lack of air traffic controllers).
  2.  Airlines sometimes deliberately plan to fly longer routes to avoid countries with high “overflight charges” (i.e., the charges incurred by airlines for the rendering of ATM services).

How small changes in ATM can have a big effect on the environment

In a recent study conducted at WHU, researchers propose two mechanisms that address both of the aforementioned shortcomings respectively: a network-oriented approach to capacity planning that improves available capacity across all airspaces; and a country-independent overflight charge that removes an airline’s incentive to fly longer routes.

The research team then use real data from up to 4,000 flights across European airspace to analyze the mechanisms’ effects on flight efficiency and emissions. The study finds that taking a network-oriented approach increases capacity cost by 2.7%—but ultimately reduces total network cost (including capacity provision costs and costs incurred by potential delays and re-fueling) by over 25%. Even more importantly, emissions generated from flight re-routings can be reduced by around 45% using this method. Furthermore, country-independent charging can lead to 11% lower network cost and savings of around 320,000 tons of CO2 across European airspace annually. However, we should note that current ATM capacities are designed in accordance with existing route preferences. Therefore, the potential benefits of country-independent chargingcan only be realized if capacities are adjusted to the resultant route choices.

Finally, it is worth noting that, in contrast to SAF and hydrogen-fuel aircrafts, the proposed improvements in ATM efficiency do not require major technological breakthroughs and can therefore be implemented in the short-to-medium term (given political consensus).

Tips for practitioners
  • Be sure to factor emissions into your operational decision-making process. This is the first step to hitting ambitious emission targets.
  • Always make decisions on capacity cooperatively across all networks and never in isolation.
  • Remember that pricing is a powerful tool to align demand (i.e., customer preferences) with the environment. If customers naturally prefer less sustainable products, differentiated pricing can help adjust those preferences.
Literature reference and methodology

The study is part of a wider research project called CADENZA funded by the European Commission (Horizon 2020). The project is a joint endeavour with various partner universities, Eurocontrol, and industry advisors.

Authors

Jan-Rasmus Künnen

Jan-Rasmus Künnen is a research assistant at the Chair of Demand Management & Sustainable Transport at WHU. His research interests lie in applying quantitative methods (optimization, game theory, modeling) to transportation and logistics problems. With his PhD, he focuses on developing mathematical models to balance demand with capacity in European air traffic management. He worked previously as a consultant with McKinsey & Company, specializing in supply chain and operations transformations.

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Professor Arne K. Strauss

Professor Arne K. Strauss holds the Chair of Demand Management & Sustainable Transport at WHU – Otto Beisheim School of Management. He specializes in the application of mathematical models to business problems, with a particular focus on the area of demand management and transport. Previously, he held positions as Associate Professor of Operational Research in the Operations Group at Warwick Business School and as Turing Fellow at the Alan Turing Institute in London. He has won several awards for his research, and he currently serves on the Strategic Advisory Team (Mathematical Sciences) of the British Engineering and Physical Sciences Research Council.

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