April 23, 2009

Congestion pricing may cut airport delays

An Israeli economist suggests charging airlines additional fees to use runways at the busiest times of day might be a way of reducing airport delays.

In London, motorists pay a fee to drive into certain parts of the city during peak traffic hours. Now Itai Ater, an economist at Tel Aviv University's Faculty of Management, suggests the same congestion pricing concept for some airports.

What I propose is a policy to reduce the amount of delays in the airline industry, Ater said. Airport congestion is a big problem in the U.S. and around the world.

Ater said some airlines might prefer not to pay the additional charge and just operate during non-congested periods, He said that, in itself, would result in a decrease in congestion.

Airlines at most airports pay for runway use depending on the weight of the aircraft, except for a few such as Chicago O'Hare, which uses pre-determined slots to set charges and time of operation.

The economist warns not all airports can benefit from his plan.

At airports where there is a monopoly or almost a monopoly by a single airline, charging a tariff during peak hours has less meaning, he said.

Ater will present his study next month in Boston during a meeting of the National Bureau of Economic Research.