Determinants of airports' environmental effects

- Analysis of noise/emissions produced by Italian airports and their determinants.
- Environmental level computed using certification data for aircraft-engine combination.
- Internalization of noise annoyance at airports.
- Panel data fixed effect econometric model.
- Airport movements, ownership and fleet characteristics.
- A +1% in movements yields a +1.05% in total environmental effects.
- A +1% in aircraft size gives rise to a +1.8% in total environmental effects.
- A +1% in aircraft age generates a +0.69% in total environmental effects.

Aviation is a fast growing sector with increasing environmental concerns linked to aircraft emissions at airports and noise nuisance. This paper investigates the factors affecting the annual environmental effects produced by a national aviation system. The environmental effects are computed using certification data for each aircraft-engine combination. Moreover, we also take into account for the amount of environmental effects that is internalized at the airport, mainly through noise regulation. We study a dataset covering information on Italian airports during the period 1999-2008. We show that a 1% increase in airport's yearly movements yields a 1.05% increase in environmental effects, a 1% in aircraft size (measured in MTOW) gives rise to a 1.8% increase and a 1% increase in aircraft age generates a 0.69% increase in environmental effects. Similar results but with smaller magnitudes are observed if airport internalization is considered. Our policy implications are that the tariff internalizing the total amount of externality is about euro 180 per flight, while the tariff limiting only pollution is about euro 60 and the one reducing noise is about euro 110. Moreover, our airport examples show that managers should prefer to address additional capacity by increasing frequency rather than aircraft size, since the former strategy is more environmental friendly.