UK government backs airport expansion while pledging to meet climate obligations

In a key policy announcement to kickstart economic growth in the UK, the government has backed expansion and a new runway at the UK’s international hub airport, Heathrow, and approved expansion at other airports in the country. It is due shortly to make a decision on a second main runway at the UK’s next biggest airport, Gatwick. The government said it was inviting proposals for a third runway at Heathrow and would ensure it was “delivered in line with our legal, environmental and climate obligations,” said the Chancellor, Rachel Reeves. Transport Secretary Heidi Alexander said “great strides” were being made into transitioning to greener aviation, citing the new sustainable aviation fuel mandate that became law in January. She announced investment of £63 million ($78m) over the next year for the Advanced Fuels Fund to support UK SAF production, alongside publication of the government’s response to its consultation on a revenue certainty mechanism aimed at encouraging SAF investment.  

Governments have for many decades grappled with how to expand constrained airport capacity in the south-east of England, where no new major runway has been built since the 1940s, only to shelve plans in the face of planning and environmental objections and challenges.

However, a third runway at Heathrow is “badly needed” and could create 100,000 jobs, said the British Chancellor, Rachel Reeves, in a major policy speech to announce support for big infrastructure projects that would help grow the UK’s stagnant economy. Delivering major infrastructure in the UK had been far too expensive and far too slow, she said, and the government would change the rules “to stop blockers getting in the way of development”, indicating a Planning and Infrastructure Bill would be introduced in the Spring.

“I have always been clear that a third runway at Heathrow would unlock further growth, boost investment, increase exports and make the UK more open and more connected as part of our Plan for Change,” said Reeves. “And now the case is stronger than ever because our reforms to the economy – like speeding up our planning system, and our strengthened plans to modernise UK airspace – mean the delivery of this project is set up for success.”

She said the government will “move at speed” to review the Airports National Policy Statement (ANPS), which provides the basis for decision-making on granting development consent for a new runway at Heathrow. The government says as part of the review, it will engage with its advisory Climate Change Committee “on how aviation expansion can be made consistent with our net zero framework.”

Under the legally binding 2008 Climate Change Act, any aviation expansion can only go ahead if consistent with the UK’s carbon budgets, a commitment confirmed by the Energy Security and Net Zero Secretary, Ed Miliband, when appearing before Parliament’s Environmental Audit Committee on January 27.

“Airport expansion remains a critically important issue in which this Committee, as so many others, is taking a keen interest,” said its Chair, Toby Perkins MP. “We will be interested in examining the government’s approach to balancing any increase in aviation emissions with other sectors across the economy.”

Responding to the Chancellor’s airport expansion announcement, the Chair of Transport Committee, Ruth Cadbury MP, who is opposed to a new runway at Heathrow, said: “Having more planes in the air and passengers moving to and from airports also needs to be weighed against our obligations to cut carbon emissions. These proposals should also be set in the context of other transport networks that would serve our major and regional airports, as well as changing trends in consumer habits and costs. In due course, the Committee will carry out detailed scrutiny of the government’s strategic approach to air travel, and how all the pieces of the puzzle might fit together.”

In a statement, Heathrow CEO Thomas Woldbye said building a third runway and the related infrastructure would unlock billions of pounds of private money during construction and once built would create jobs and drive trade, tourism and inward investment to all parts of the country.

“It would also give airlines and passengers the competitive, resilient hub airport they expect while putting the UK back on the map at the heart of the global economy. With strict environmental safeguards, it would demonstrate that by growing our economy responsibly, we can ensure our commitments to future generations are delivered,” he said.

“We will now work with the government on the expected planning reform and support ministers to deliver the changes which will set us on track to securing planning permission before the end of this Parliament.”

Unsurprisingly, the UK aviation industry welcomed the Chancellor’s speech. “Airports make an enormous contribution to the economy, connecting businesses, facilitating imports and exports, bringing in investment and creating jobs. Expanding capacity will support growth in all these areas and will not come at the expense of our sustainability goals,” said Karen Dee, Chief Executive of trade body AirportsUK.

“New, cleaner fuels, more efficient and quieter aircraft, decarbonised airport operations and modernisation of our airspace will all ensure aviation is able to meet its obligations, alongside growth.”

Added Tim Alderslade, Chief Executive of Airlines UK: “We welcome the strong recognition from the Chancellor of aviation’s unique role enabling economic growth in all parts of the UK. Airlines support more airport capacity to grow the economy and foster trade but expansion must be affordable, improve operational resilience for passengers and freight, and be compatible with our net zero commitments.

“Airlines are making progress towards net zero and the industry now needs government help to align any additional capacity with further policy support to incentivise the production of SAF and deliver urgent modernisation of airspace as quickly as possible.”

European airport representative body ACI Europe welcomed the announcement by the UK government, and described it as “a wake-up call” for the EU, referencing the recent report by Mario Draghi on improving EU competitiveness.

“The report is all about the imperative of competitiveness and growth to achieve our global goals – and it is unequivocal about the fact that as global passenger demand keeps increasing, infrastructure will need to expand so as to tackle congestion and unlock further growth. Yet we see a number of EU countries focused on limiting capacity at their major airports – jeopardising not just their own economic prospects but also those of the bloc,” said Olivier Jankovec, Director General.

ACI Europe added: “While all expansion projects must adhere to a strict regime of environmental permits and, in the specific case of the UK, to the Climate Change Act, there is no escaping the reality that the UK government’s support for airport expansion must come hand in glove with full support for aviation decarbonisation – in particular as regards the production and affordability of sustainable aviation fuels and airports’ access to renewable energy.”

Britain’s biggest trade union, Unite, said the addition of a third Heathrow runway would represent a once-in-a-generation opportunity to secure long-term prosperity, both locally and nationally, and should create “tens of thousands of unionised high-quality jobs across construction, engineering and civil aviation, ensuring fair pay and good conditions for workers.”

It said support for a new runway should though be fully coordinated with investment in sustainable aviation fuel to minimise the carbon impact, and has written to the Chancellor urging her to ensure Grangemouth, the only oil refinery in Scotland, and which is due to close this year with the loss of 400 jobs, is urgently transformed into a SAF production facility.

“If the Chancellor is serious about claiming the environmental benefits of SAF as part of her dash for growth, and the government’s duty to ensure we have energy security, she will need Grangemouth to start producing SAF as soon as possible,” said Sharon Graham, General Secretary.

Battle-hardened environmental groups, supported by local councils and MPs with constituencies neighbouring airports, have to date seen off previous plans to expand airport capacity in the UK, particularly at Heathrow, successfully bringing action through the courts.

UK campaign group Aviation Environment Federation said it was frustrated and saddened that a third runway at Heathrow was now back on the political agenda.

“Expanding Heathrow is one of the most destructive infrastructure projects the government could consider, and the evidence is thin that it would generate the level of economic growth the Chancellor envisages,” said an AEF statement. “Many years have already been spent fighting this project in many guises and it is disappointing that campaigners find themselves back in this situation once more.”

Doug Parr of Greenpeace, a veteran campaigner against expansion, believes that the solutions put forward by the Chancellor to address the environmental impact of aviation growth – such as zero-emission electric planes, sustainable aviation fuels and the avoidance of circling planes – are “myths”. He said: “The idea that there are new developments that will cancel out the rise in carbon emissions from expanding airports, including Heathrow, simply isn’t right. The suggested improvements will likely have a small impact. Innovations that could have major impacts on carbon reduction rely on technological and commercial developments that are far from assured.”

Rosie Downes, Head of Campaigns at Friends of the Earth, said: “Giving the go-ahead to airport expansion by depending on new, unreliable technologies like sustainable aviation fuels would be a reckless gamble with our future and risks the UK missing critical climate reduction targets even if we rapidly expand renewable energy.”

FoE, together with legal charity Plan B, successfully brought a case based on climate commitment arguments before the Court of Appeal in 2020 to halt the previous attempt to expand Heathrow.

Finlay Asher, co-founder of Safe Landing, a community group of climate-concerned aviation workers, said: “British aviation’s future lies in innovation, not expansion. We should instead transform our airports for the future of zero-carbon aircraft. The UK has a huge economic opportunity to pioneer this transition, back British manufacturing and create jobs developing the technology of tomorrow for export worldwide.

“Electric or hydrogen aircraft are our ticket to greener, cleaner and quieter flights. They can reduce carbon emissions and air and noise pollution for communities living under flight paths – unlocking a key political impasse that has previously prevented plans. But rather than expand concentrated long-haul hubs like Heathrow, we instead need a more distributed network of smaller, regional airports to test the technology of tomorrow.”

James Meadway, Senior Director of Economics at UK-based aviation and shipping climate group Opportunity Green, said: “The decision to push for a third runway at Heathrow is based on wishful thinking and bad economics. Airport expansion does not significantly add to growth in well-connected developed economies, as the economic evidence now shows. Business travel is falling whilst the UK runs a huge tourism deficit, with tourists from the UK spending £41 billion ($51bn) more abroad than tourists from elsewhere bring in.

“But additional flight capacity will trash the government’s commitments to reducing emissions and ruin Britain’s international reputation as a climate leader. Sustainable aviation remains a very distant prospect, despite industry claims. Government time and money would be better spent delivering vital investment in public transport across the rest of the country.”

Another strong opponent of Heathrow is the Mayor of London, Sadiq Khan, who commented: “I remain opposed to a new runway because of the severe impact it will have on noise, air pollution and meeting our climate change targets. Despite the progress that’s been made in the aviation sector to make it more sustainable, I’m not convinced that you can have hundreds of thousands of additional flights at Heathrow every year without a hugely damaging impact on our environment.”

Asked by the BBC whether the Mayor would be able to legally stop the expansion, the Chancellor said “no”, adding she wanted “spades in the ground” in the current Parliament, which has less than five years to run, and planes to start using the runway by 2035.

“I say that because we’re not just announcing that we back it, we are changing the way that our planning system works to make it easier to deliver projects like the third runway at Heathrow,” she said.

The government has also published its response to a public consultation on the options for a UK SAF revenue certainty mechanism (RCM), which aims to reduce the risks of uncertain revenues for emerging SAF plants and help attract investment into UK SAF projects.

It confirms that the RCM will take the form of a Guaranteed Strike Price (GSP), which the government believes offers the highest level of confidence for investors.

“The scheme will be built on the established precedent of contracts for difference schemes, providing a clear and transparent claim process for industry and specifically targeted at UK SAF plants,” said Transport Secretary Heidi Alexander in the foreword to the RCM consultation response publication.

The government estimates 97 million litres of SAF were supplied in the UK in 2023, double the amount of the previous year.

“However, much greater volumes of SAF will be required to ensure that 10% of UK aviation fuel is SAF by 2030 and 22% by 2040, as required by the government’s SAF Mandate,” said Alexander. “Through the RCM, alongside the Advanced Fuels Fund, which is extended for a further year with an additional £63 million of funding, we will address barriers to the production of SAF in the UK and help realise the full potential of this technology.”

The government will introduce the SAF Revenue Support Bill that will provide primary powers required to deliver a GSP-style mechanism for UK SAF production and expects the legislation to be in place by the end of 2026. It says the RCM will be industry-funded and will consult on this issue shortly.

Photo: Heathrow Airport

Christopher Surgenor

Editor

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