Luton scaling back airport expansion plans, delaying 2nd terminal, to…

luton-scaling-back-airport-expansion-plans,-delaying-2nd-terminal,-to…

Luton scaling back airport expansion plans, delaying 2nd terminal, to…

Luton scaling back airport expansion plans, delaying 2nd terminal, to save £1 billion
2021-05-20 18:06:00
Luton Airport, which is owned by Luton council, is planning to scale back its expansion plans in order to save perhaps £1 billion.  In 2019 the airport consulted on plans for a new terminal that would enable the annual number of passengers to be increased from 18 million to 32 million by 2039. There will now be a new consultation, later in 2021 or in 2022, for initially improvement of the existing terminal, and then eventually a second terminal, at some future date. The airport’s finances have been seriously hit by Covid. The Council benefitted greatly from the airport (before Covid), in 2019 receiving a £19.1m, and £15.8m servicing debt. In 2020 the airport had huge public subsidy, and more will follow for 2021. Local campaigners will be looking very carefully at what might emerge from proposals for further passenger growth using the existing terminal. This might be by creative use of “permitted developments” which Luton Borough Council could approve on its own. If such growth could accommodate more than an additional 5 million passengers per year (taking Luton to 23Mppa) it would then become possible for the declared ambition to reach 32Mppa to be achievable without need for a DCO, as below the 10 Mppa threshold. .Tweet   Luton rethinks airport expansion plans 18 MAY 2021 BY JONATHAN KNOTT  (LGC) Luton Airport, wholly owned by the town’s financially-struggling council, is scaling back its expansion plans to save “the best part of £1bn” on its original £2.4bn price tag, LGC has learned. In 2019 London Luton Airport Limited, run through a Luton BC subsidiary company, consulted on plans that would see a new terminal built with annual passenger capacity increasing from 18 million to 32 million by 2039, concluding the consultation process in December 2019. It now intends to begin a new full consultation on revised plans later this year or next year, the firm’s chief executive Graham Olver told LGC. These would consist of two stages, with an initial focus on improving the existing terminal, followed by the construction of a second terminal “at some point in the future”. MPs from constituencies near the airport have recently spoken out against the expansion plans, citing concerns including noise and environmental impact, but the pandemic has also had a devastating impact on the airport’s finances. Before Covid, the airport contributed a significant amount to the council’s income, providing a £19.1m dividend in 2019-20, £15.8m servicing debt and a further £9.9bn [sic] for local charities and community groups. The airport says it has provided £287m to the council since 1998 in dividend, rents and payment for services. But last year the council had to borrow £60m from the Public Works Loans Board and lend it to LLAL to ensure its stability as the pandemic resulted in a collapse in passenger numbers. Luton BC was also granted a £35m emergency capitalisation direction for 2020-21 by the government in February, with a further £14m expected this financial year. This support is tied to an assurance review that will explore “reducing the council’s financial exposure to the airport”. Mr Olver said that following the previous consultation, “we put in place a check and challenge review”, asking: “Is this project the one that the people in Luton, the community and our neighbours really want or need? Or is this something that we could look at and try and improve on?” “We gave ourselves some really tough challenges, including the capital cost of the development, but importantly, also the impact on the environment,” he said. He said that discussions about “150 different scenarios about the way in which we could improve the development” had resulted in “taking out and changing the earthworks” that were originally planned for the new terminal. “We effectively save the best part of a billion pounds worth of expenditure,” said Mr Olver. “But equally, the disruption that you would have had has disappeared.” He claimed such a redesign would save a volume of earthworks equivalent to “the second biggest pyramid in Egypt”. He said the expansion was now envisaged in “two stages”, because the “first rule of sustainability” is to “make the most of the assets you’ve already got”. The airport had been discussing “how we make the most out of terminal one, roll that out to have some part of the progression, and then build terminal two at some point in the future”, Mr Olver said. This second stage could be “seven, eight years plus in the future. But of course, it has to match demand as well,” said Mr Olver, who noted the importance of getting “the balance right between the demand and the construction timetable”. He said of the new strategy: “We build it for less – so the price of it is less; we make the most of the existing assets that we’ve got. And we make sure that we’re robust and resilient to keep putting this money back into the council and the community for the highest possible impact. “We were clearly disrupted by Covid…but now we’re at a point where we absolutely believe, and all the evidence supports us, that we’ve got a good viable project, that we’re doing the right things.” The aim was still to increase capacity from 18 million to 32 million passengers a year, he said. Mr Olver said the airport had “completely reinvigorated” its approach to sustainability, claiming the new plans would be consistent with a pathway towards net zero carbon that aligned with the council’s decla

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