Congestion Pricing for Airports and for En Route Airspace

Summary

A growing number of major airports around the world are adopting demand management measures in response to increasing delays and congestion. These measures are mostly based on administrative allocation of slots through schedule co-ordination, a practice viewed by many as anti-competitive and running counter to efforts to de-regulate air transport markets. Congestion pricing can be either an alternative to administrative slot allocation or a complement to it. In this paper, we review briefly the theoretical principles of congestion pricing and discuss how recent advances based on queuing theory facilitate the resolution of some fundamental related technical issues. We then discuss practical difficulties in applying congestion pricing to airports and conclude that applications must necessarily deviate from theory by taking into consideration a number of institutional and practical constraints. We also ident the hard technical issues involved in applying dynamic congestion pricing schemes for demand management in en route airspace.