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Higher cost of carbon emissions threatens UK airport expansion plans

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Tougher planning rules designed to help curb climate change are threatening the viability of UK airport expansion plans, which have become a battleground for campaigners who oppose growth of the aviation industry.

New runways or terminal buildings are increasingly at risk from legal challenges on environmental grounds, according to lawyers, with one arcane metric offering activists a potential new weapon: the rising cost of carbon emissions.

Campaigners are hoping that planning authorities will take greater account of the impact of emissions on the economic case of proposed projects.

The government in September more than tripled the so-called “carbon value” — the official benchmark that puts a price on the emissions associated with a scheme — to reflect the country’s net zero 2050 commitment.

Yet the economic cases for six of the seven major airport expansion proposals — including London’s Heathrow and Gatwick — use either the old value, or none at all, according to the New Economics Foundation, a leftwing think-tank.

The NEF, which is highly critical of airport expansion on climate grounds, warned in a recent report that the increase in carbon values — the central price rose from £77 to £245 per tonne of carbon — meant the environmental impact of these projects had been “dramatically underestimated”.

Sarah Fitzpatrick, a partner and head of the planning team at law firm Norton Rose Fulbright, said the aviation sector’s role as a polluter was coming under greater scrutiny. “Assessment of carbon values, and non-CO2 based emissions that contribute to climate change, are likely to be very important when promoters of airport expansion proposals are assessing their projects and seeking consent.”

As yet, planning law in England does not explicitly require carbon values to be used. But the relevant planning authority can demand they are included in applications.

Estelle Dehon, an environmental specialist at Cornerstone Barristers, said the increase in carbon values was “potentially devastating” for airport enlargements. Given that the economic benefits and climate impacts of airport expansions were “central” to applications, “it’s difficult to see any cogent justification for not using [them]”, she said.

Failure to use up-to-date carbon values “could conceivably give rise to a legal error and accordingly increase the risk of litigation”, said Sam Hunter Jones, a senior lawyer at environmental group ClientEarth.

The proposed expansion of Bristol airport, in south-west England, is seen as a test case. North Somerset council rejected the application in 2020, noting that the developer’s analysis had ignored carbon values. The latest metric was included in an appeal to the Planning Inspectorate, a government agency, early last year, with a decision still pending.

Campaigners and lawyers are watching the Bristol case closely, including those opposed to the expansion of Leeds Bradford airport, whose application did not include carbon values. The government this month ordered a public inquiry into the expansion plans of the airport in West Yorkshire.

“The lack of clarity at the heart of the planning law, in relation to climate change especially, allows every player to justify their chosen position,” said Ian Coatman, secretary of the Group for Action on Leeds Bradford Airport, which opposes the expansion plans.

During its appeal, for example, Bristol airport argued that the use of carbon values would lead to double counting as the aviation sector was already regulated under the UK emissions trading scheme, which requires companies to buy allowances to pollute.

Dehon said that if the outcome of Bristol’s appeal gave a “clear line” on carbon values it was very likely to inform other airport expansion decisions. The UK government’s airport policy, which predates the UK’s net zero targets but helps guide planning decisions, requires applicants to “provide evidence of the carbon impact of the project”. 

When Bristol resubmitted its plans for the appeal, using the updated values, the carbon cost of the project rose to £623m, reducing its net benefits to £502m, North Somerset council said. The original cost-benefit analysis had a figure of £1.6bn. The airport declined to comment but in its appeal it said the economic benefits of the plan remained “strong”.

Several airport executives said they had long expected emissions targets to become tougher — but that the economic benefits of expanding would still outweigh the environmental costs, particularly as the industry has promised to lower its emissions. The aviation industry has pledged to achieve net zero carbon emissions by 2050 by adopting new technologies.

If the new values were applied to the controversial expansion of London’s Heathrow airport, the UK’s main hub, the NEF calculated they would double the carbon cost to about £100bn.

The airport received approval from the government to proceed with a third runway at the end of 2020 after a lengthy court battle. But it still has to obtain planning permission if it decides to push ahead.

Heathrow insisted it would still have a strong economic case for expansion even if it used the September value. “We have always known that we will have to prove that a new runway is compatible with the UK’s net zero target,” it said.

The NEF’s assessment suggested there were even more serious implications for expansion plans at London’s Gatwick airport. It found that using the updated carbon value would “wipe out the majority of the benefit claimed by Gatwick”, according to Alex Chapman, the report’s author.

In response, the airport said it was “assessing” what the new carbon price meant for its plans but that it did not anticipate that adopting them would mean the project was “not necessary or not consentable”.

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