Preliminary Cost Benefit Analysis CS#7 Network Infrastructure Performance Monitoring and Analysis
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1 Preliminary Cost Benefit Analysis CS#7 Network Infrastructure Performance Monitoring and Analysis Alberto Varano Principal Director Resources 8 July 2013
2 CBA Method Preliminary CBA at feasibility stage to assess value of the CS concept CBA compares 2 scenarios: Current best case fragmented implementation inc. FAB deployments and SESAR Common Project deployments Deployment of Centralised Service For robust CBA, uncertainties addressed through conservative assumptions: High for Centralised Service Scenario Low for Fragmented scenario
3 CBA Method (2) CBA quantifies impact of deploying CS on aviation stakeholders: ANSP, EUROCONTROL, Airlines and other Airspace Users CBA takes account of Investment costs, Operating and Maintenance Operational benefits such as fuel burn, ATCO productivity and QoS The cost and benefit impact of time to operations Not included in the CBA: knock on effects on costs and benefits of enabling better performance (e.g. better data quality will lead to improvement of services) Impact of tendering the services. The competition in tendering, can lead to best innovative solutions in the most cost efficient conditions An external company will validate EUROCONTROL CBAs
4 CBA Scenarios Fragmented Scenario: Each ANSP will investigate issues and measures performance on their own to meet the EU regulations. The same issue might be investigated several times. The current ECTRL service will continue. Centralised Service: An enhanced CS will be provided to ANSP. The collection and management of anomalies, analysis of data and management of specific sensors will be tendered. Timeframe: The CBA compares the centralised service with the baseline fragmented deployment scenario. CS7: Development: ; Fully Operational in 2016 Fragmented Scenario: Current situation Preliminary Cost Benefit Analysis CS#7 4
5 CBA Dates Fragmented Scenario Development Start Deployment End Deployment Start Full CBA Time Horizon N/a N/a N/a On going On going Centralised Service (CS#7) Development (improvement s) Start Deployment of Improvements End Deployment Start Full CBA Time Horizon Preliminary Cost Benefit Analysis CS#7 5
6 Centralised Service vs Fragmented Network Infrastructure Performance Monitoring and Analysis Service (NIPS) Operational Benefits Investment Operating & Maintenance ATCO Time to Fuel burn / Route Extension CO2 Tax Savings ATCO productivity QoS (Capacity, Delay..) CS #7 ensures that the QoS is achieved through pro-active detection and resolution of Data link and Surveillance deficiencies. These deficiencies can reduce ATCO productivity and network capacity. Preliminary Cost Benefit Analysis CS#7 6
7 CS#7 will achieve cost reduction through lower operating & maintenance costs compared to a scenario where each ANSP in the EU will have to investigate issues on their own. There might also be some synergies and reduction in maintenance cost due to the fact that different activities currently under this service in EUROCONTROL are outsourced to different companies Investment Operating & Maintenance ATCO Time to Other CS#7 is estimated to cost 2.4 M in development CS#7 will cost 4.8M per year vs. 9.4 M in fragmented deployment No impact No impact No other impact assessed Preliminary Cost Benefit Analysis CS#7 7
8 Preliminary Cost Benefit Analysis Results CS#7 Network Infrastructure Performance Monitoring and Analysis
9 Deployment of CS#7 reduces European ANS costs by approximately 4 M a year Total cost saving with CS#7 is 67 M in Fragmented Deployment Annual Operating Operational Benefits Cumulated Cost M Not quantified 141 M undiscounted CS#7 Network Infrastructure Performance Monitoring and Analysis Annual Operating Operational Benefits Cumulated Cost M Not quantified 74 M undiscounted Preliminary Cost Benefit Analysis CS#7 9
10 The initial investment in CS#7 will be paid back in 2016 reaching a total cost saving of 67 M by ,00 140,00 120,00 Cumulated Cost of Fragmented vs Centralised Deployment 141 Millions of Euros 100,00 80,00 60,00 40,00 20,00 0, CS7 Centralised Service (Cumulated undiscounted) Fragmented Deployment (Cumulated undiscounted) Preliminary Cost Benefit Analysis CS#7 10
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