FINAL REGULATORY IMPACT ANALYSIS

FINAL RULE

AUTOMATIC DEPENDENT SURVEILLANCE – BROADCAST (ADS-B ) OUT PERFORMANCE REQUIREMENTS TO SUPPORT AIR TRAFFIC CON TROL

SERVICE

(TITLE 14, CODE OF FEDERAL REGULATIONS, PART 91)

Office of Aviation Policy and Plans Regulatory Analysis Division

August 18, 2009 U.S. Department Of Transportation

FEDERAL AVIATION

ADMINISTRATION

Washington, D.C. 205911 Table of Contents 1.0 Executive Summary..............................

................................................... ............... 2

2.0 Introduction...................................

................................................... ....................... 3 2.1 The Advantages of ADS-B Over Radar.............

................................................... .... 5

2.2 The ADS-B Out Final Rule.......................

................................................... ............. 6

2.3 Market Failure.................................

................................................... ....................... 7 2.4 General Assumptions for the Benefits Analysis a nd Government Cost Analysis.... 9 2.5 Definition Of Scope ............................

................................................... ................. 11 3.0 Definition Of Approach .........................

................................................... .................. 11 4.0 Scenarios Analyzed.............................

................................................... ..................... 12

4.1 No-Rule Baseline Scenario......................

................................................... ............ 12

4.1.1 Definition ...................................

................................................... ................... 12 4.1.2 Cost to Aircraft Operators of the Baseline Sc enario........................................ 12 4.1.3 Cost to FAA of Continuing Full Radar Surveill ance Under the Baseline

Scenario...........................................

................................................... ....................... 12

Surveillance.......................................

................................................... ................. 12

4.1.4 Benefits .....................................

................................................... .................... 14 4.2 ADS-B Out – The Final Rule (Preferred Alternati ve)............................................ 14

4.2.1 Definition ...................................

................................................... ................... 14 4.2.2 Requirements of the Rule.....................

................................................... ......... 14 4.2.3 Industry Estimation of ADS-B Equipage Costs .. ............................................ 15

4.2.4 Cost to FAA to Provide Surveillance Under the ADS-B Out Scenario.......... 37

4.2.5 Benefits of ADS-B Out........................

................................................... ......... 39 4.2.5.1 High Altitude Operations Over the Gulf of M exico ................................. 40 4.2.5.2 Improved En Route Conflict Probe Performanc e ..................................... 41 4.2.5.3 More Accurate Metering Because of Increased Accuracy ....................... 49 4.2.5.4 Increased Ability to Allow Optimized Profil e Descent Procedures ............. 51 4.2.5.5 Net Impact on Carbon Dioxide Emissions..... ............................................... 56

4.3 Multilateration Alternative Scenario...........

................................................... ... 64

4.3.1 Definition ...................................

................................................... ................... 64 4.3.2 Cost to Industry.............................

................................................... ................ 65

4.3.3 Cost to FAA ..................................

................................................... ................ 65

4.3.4 Benefits of Multilateration Surveillance.....

................................................... .. 66 5.0 Summary Comparison of Costs and Benefits ...... .............................................. 67 6.0 Additional Programmatic Benefits of ADS-B Out .. ............................................. 71 6.1 Increased Ability to Conduct Operations at Low Altitudes over the Gulf of

Mexico .............................................

................................................... .............................. 71 6.2 Enhanced Search and Rescue Capability..........

................................................... . 71 6.3 Enhanced Surveillance Where Radar is Currently Weak ..................................... 74 Appendix A Legacy Infrastructure Costs .............

................................................... ..... 76 Appendix B – Reduced Delay over Gulf of Mexico..... ................................................ 80 Appendix C Optimal Routing .........................

................................................... ......... 107 Appendix D Conflict Probe Sensitivity Analysis ..... .................................................. 1 16 Appendix E A Timeline of ADS-B Out Costs and Benefi ts....................................... 1172

1.0 Executive Summary

The solution to managing growth in the National Air space System (NAS) is the Next Generation Air Transportation System, or NextGen, w hich will assure the safe and efficient movement of people and goods as demand in creases. NextGen will use technology to allow precise surveillance, permit ac curate real-time communication, and vastly improve situational awareness.

ADS-B is the chosen new technology for surveillance in the NextGen system. It is a key component in achieving many of the goals set forth in the NextGen Integrated Plan. ADS-B is a critical component of NextGen and is bei ng developed to transform today’s radar-based aviation system to handle increased avi ation demand. By itself, ADS-B presents significant benefits, but as a component o f the NextGen system, the benefits will substantially increase.

We review the following three alternatives for surv eillance in this analysis:

• Baseline radar – Maintain the current radar-based s urveillance system and replace radar facilities when they wear out.

• ADS-B – Aircraft operators equip to meet performanc e requirements required by the rule and the FAA provides surveillance services based on downlinked aircraft

information.

• Multilateration – The FAA provides surveillance usi ng multilateration.

The estimated costs of the final rule are the costs of ADS-B Out incremental to radar.

The estimated incremental cost of the ADS-B Out rul e ranges from a low of $3.3 billion ($2.2 billion at 7% present value) to a high of $7. 0 billion dollars ($4.1 billion at 7% present value). These costs include costs to the g overnment, as well as to the aviation industry and other users of the airspace, to deploy ADS-B and are incremental to maintaining surveillance via current technology (ra dar). The aviation industry will begin incurring costs for avionics equipage in 2012 and w ill incur total costs ranging from $2.5 billion ($1.4 billion at 7% present value) to $6.2 billion ($3.3 billion at 7% present value) with an estimated midpoint of $4.4 billion ($2.3 bi llion at 7% present value) from 2012 to 2035. The estimated compliance cost of affected fo reign operated airplanes operating in the United States is about $5.6 million to $134 mil lion, with a midpoint around $70

million. 1 These estimated foreign operator costs are not in cluded in this analysis.

The estimated quantified benefits of the rule range from $6.8 billion ($2.1 billion at 7% present value) to $8.5 billion ($2.7 billion at 7% present value) and primarily result from savings in fuel, operating cost and time, the net r eduction in CO 2 emissions from more efficient flights and the consumer surplus associat ed with the additional flights

accommodated because of the rule. The table below summarizes costs and benefits discounted by 7%.

1 Official Airlines Guide.3

Table E.1 Summary of Costs and Benefits in Billions of 2009 Dollars Discounted by 7%

2.0 Introduction

Automatic Dependent Surveillance-Broadcast (ADS-B) is an advanced surveillance technology that enables equipped aircraft to period ically broadcast their identification, current position, altitude, and velocity, through a n onboard transmitter, which can be received by ADS-B ground stations and by other airc raft appropriately equipped to receive this information. ADS–B Out provides air t raffic controllers with real-time position information that is, in most cases, more a ccurate than the information available with current radar-based systems. With more accura te information, ATC will be able to position and separate aircraft with improved precis ion and timing.

The part of the ADS-B system that broadcasts vario us aircraft information is called “ADS-B Out”. The part of the system that provides aircraft with the ability to receive

other aircrafts’ ADS-B information and other aerona utical information is called “ADS-B In”. The rule mandates ADS-B Out for operations in certain airspace.

The rule will require most aircraft to be equipped with avionics equipment that meets ADS-B Out performance standards. The rule will app ly to aircraft operating in Class A, B, and C airspace, and in the Class E airspace at and above 10,000 ft MSL over the 48 contiguous United States and the District of Columb ia, excluding the airspace at and below 2,500 ft above ground level (AGL). The rule also applies to all airspace within 30 nautical miles (NM) of an airport listed in Title 1 4 of the Code of Federal Regulations (14 CFR), Part 91, Appendix D, from the surface upward to 10,000 feet mean sea level (MSL) and all airspace above the ceiling and within the lateral boundaries of a Class B or Class C airspace area designated for an airport upw ard to 10,000 feet MSL. Additionally,4

the rule will apply to aircraft operating in Class E airspace at and above 3,000 feet MSL

over the Gulf of Mexico from the coastline of the U ntied States out to 12 nautical miles. The rule mandates a compliance date of 2020. The F AA has entered into service contracts with vendors who will provide an ADS-B g round surveillance infrastructure that includes the provision of Flight Information S ervices-Broadcast (FIS-B) and Traffic Information Services - Broadcast (TIS-B) in 2013. If these services are not available by that time, the FAA will consider extending the comp liance date of the final rule. As the ground component of the ADS-B infrastructure become s mature, the agency plans on decommissioning selected noncritical secondary surv eillance radar sites. The agency plans on retaining approximately 50% of the current secondary radar sites and 100% of the existing primary radar systems that will serve as a redundant backup system in the event of a large scale ADS-B service disruption. 2 The rule will not mandate ADS-B In equipment, but the service contractor will provide ground services to enable ADS-B In.

This analysis presents estimates of the costs and i ncremental (relative to a radar alternative) benefits of the rule (the ADS-B Out sc enario) as well as a second alternative -

multilateration. The costs of a baseline scenario assumes that we continue to use and replace radar without further supplementing existin g radar service and without requiring ADS-B Out or providing services for ADS-B. We also look at the costs of the alternative approach of using multilateration rather than radar or ADS-B Out.

Table 1 summarizes the substantive differences betw een the proposed rule and the final rule. We also made editorial changes and clarifica tions as explained in the preamble.

2 After exploring various back-up alternatives, the F AA believes maintaining a smaller set of secondary radar systems provides the greatest level of certai nty. This is because FAA has long-standing experie nce with secondary surveillance radar systems and they are already in place.5 Table 1 Substantive Differences between the Proposed Rule a nd the Final Rule

Issue Area The NPRM— The final rule— Effects on

Costs/Benefits

Technical

Standard

Order Proposed performance

standards as defined in TSO–C166a (1090 MHz ES) or TSO–C154b (UAT). Requires performance

standards as defined in TSO–C166b (1090 MHz ES) or TSO–C154c (UAT). Proposed requiring all

aircraft above FL240 to

transmit on the 1090 MHz

ES broadcast link. Requires all aircraft in Class A airspace (FL180 and above) to transmit on the

1090 MHz ES broadcast

link. Possible minimal

increase in costs Airspace

Proposed ADS–B

performance standards for operations in all Class E airspace at and above 10,000

feet MSL. Requires ADS–B performance standards for operations in Class E airspace at and above 10,000 feet MSL, excluding the airspace at and below 2,500

feet AGL. Possible decrease in

costs

NAC P Proposed a NAC P ≥ 9, which

provides navigation accuracy

< 30 meters. Requires NAC P < 0.05 NM. (NAC P ≥ 8) No effect on ADS-B

Out benefits

Requires an SDA of 2 or 3 SIL Proposed a SIL of 2 or 3

Requires a SIL of 3

Antenna Diversity Proposed antenna diversity

in all airspace specified in the rule. Does not require antenna diversity. No effect on ADS-B Out benefits, lower

GA costs

Total Latency Proposed latency in the

position source < 0.5 seconds and latency in the

ADS–B source < 1 second. Requires uncompensated latency

≤ 0.6 seconds and maximum total latency ≤ 2.0 seconds. Message

Elements Proposed a broadcast

message element for “receiving ATC services.” Does not require a broadcast message element for “receiving ATC services.” An ability

to turn off

ADS–B Out Proposed that the pilot be

able to turn off ADS–B transmissions if directed by

ATC. Does not require the pilot be

able to disable or turn off

ADS–B transmissions.

2.1 The Advantages of ADS-B Over Radar

According to operational evaluations, ADS-B provide s improved accuracy over radar in almost every air traffic scenario. The ADS-B requi red by the rule is capable of achieving accuracy to within 30 meters, a capability exceedin g any existing radar. ADS-B also provides more timely information updates than conve ntional radar. Unlike radar, the accuracy and integrity of ADS-B Out is uniform and consistent throughout the service6

areas. Therefore, the ability of air traffic contro l to accurately identify and locate aircraft that are further away from air traffic control faci lities will be better than radar. ADS-B Out also provides more information to air traffic c ontrollers, such as aircraft dimensions and aircraft heading, than the current system does, especially in non-radar areas. Furthermore, ADS-B position reports are not subject to interference (clutter) from terrain, ground structures, flocks of birds, or thunderstorm s; whereas, radar is.

2.2 The ADS-B Out Final Rule

ADS-B Out will provide enhanced surveillance in are as where secondary surveillance radar (SSR) capability currently exists as well as over the Gulf of Mexico and areas in

Alaska. The FAA believes that it is reasonable to require that aircraft meet the performance necessary for ADS-B Out for operation i n airspace that currently requires transponders. With this rule, the FAA adds Section 91.225 to 14 CFR which requires ADS–B Out for operations in Class A, B, and C airsp ace. In addition, the rule requires that aircraft meet ADS-B Out performance requiremen ts to operate in the Gulf of Mexico

from the coastline of the United States out to 12 N M at and above 3,000 feet MSL. Similar to the transponder requirements, ADS-B Out also will be required within 30 NM of an airport listed in 14 CFR Part 91, Appendix D, from the surface upward to 10,000 feet MSL. The rule will permit aircraft not origin ally certificated with an engine-driven electrical system or not subsequently certified wit h such a system installed (such as a balloon or glider) to conduct operations without AD S-B Out under ATC authorization in the airspace within 30 NM of an airport listed in A ppendix D if the operations are conducted: (1) outside any Class A, Class B, or Cla ss C airspace area; and (2) below the altitude of the ceiling of a Class B or Class C air space area designated for an airport or 10,000 feet MSL, whichever is lower. The rule also requires aircraft meet ADS-B Out performance requirements to operate in Class E airs pace within the 48 contiguous states and the District of Columbia at and above 10,000 fe et MSL, excluding the airspace at and below 2,500 feet above the surface.

Generally, Class A airspace is that airspace from 1 8,000 feet MSL to and including FL 600, including the airspace overlying the waters wi thin 12 NM of the coastline of the United States. This rule will not require aircraft to meet the ADS-B Out performance standards for aircraft that operate in airspace bey ond 12 NM from the U.S. coastline and do not enter U.S. domestic airspace. 3

Class B airspace area locations shall include at le ast one primary airport around which the Class B airspace area is designated. The lateral l imits should be initially designed in a circular configuration centered on the primary airp ort. The outer limits of the airspace shall not exceed a 30 NM radius from the primary ai rport and will generally be divided

into three concentric circles: an inner 10 NM radiu s, a middle 20 NM radius, and an outer 30 NM radius. The inner 10 NM radius may be subdiv ided based on operational needs,

3 There are numerous Offshore Airspace Areas that ar e designated as Class A airspace and the boundaries of those airspace areas extend beyond 12 NM from th e coastline of the U.S. and into international wate rs. Under agreement with ICAO, the U.S. provides ATC se rvices in these areas and may designate the airspac e accordingly in order to indicate to pilots the type of ATC services that may be provided.7

runway alignment, adjacent regulatory airspace, or adjacent airports. The vertical limits of a Class B airspace normally should not exceed 10 ,000 feet MSL. The inner 10 NM area shall normally extend from the surface to the upper limits of the airspace. The floor of the area between 10 and 20 NM will normally have a floor between 2,800 and 3,000 feet above airport elevation. This floor shall rem ain constant for that segment, but may be adjusted considering terrain and adjacent regula tory airspace. The floor of the area between 20 and 30 NM will normally be between 5,000 and 6,000 feet above the airport elevation. Class B airspace areas generally are co nfigured and appear as an upside-down wedding cake and surround the nation’s busiest airp orts in terms of airport operation or passenger enplanements. The configuration of each Class B airspace area is individually tailored and is designed to contain all published i nstrument procedures. An ATC clearance is required for all aircraft to operate i n the airspace area, and all aircraft that are so cleared receive separation services within the a irspace. Under this rule, ADS-B Out will be required for aircraft operating in this air space. Class B airspace areas experience a high volume of aircraft operations and complex tr ansitions from the en route to the terminal environment. Consequently, ADS-B Out can result in better ATC surveillance and situational awareness for controllers and pilot s in these areas.

Generally, Class C airspace lateral limits are init ially designed as two circles centered on the airport reference point. The inner circle is a 5 NM radius, and the outer circle is a 10 NM radius. The vertical limits of a Class C airspa ce should be 4,000 ft above the primary airport’s field elevation (charted in MSL). The airspace within the 5 NM circles shall extend down to the surface and the airspace b etween the 5 and the 10 NM circles shall extend no lower than 1,200 ft AGL. Although the configuration of each Class C area is individually tailored, the airspace lateral and vertical limits are in accordance with the information above, to the extent possible. For a site to be considered for Class C airspace designation, the airport must be serviced by an operational airport traffic control tower and a radar approach control; and either an a nnual instrument operations count of 75,000 at the primary airport, an annual instrument operations count of 100,000 at the primary and secondary airports in the terminal area hub, or an annual count of 250,000 emplaned passengers at the primary airport. Additi onally, each person intending to operate an aircraft within Class C airspace must es tablish two-way radio communications with the ATC facility providing air traffic service s prior to entering the airspace and must

maintain those communications while within the airs pace.

2.3 Market Failure

Given the benefits that ADS-B equipage will generat e, it might initially appear that users of the system will have economic incentives to equi p with ADS-B even in the absence of a federal requirement to do so. However, it is to each operator’s advantage to wait until everyone else has equipped or at least until each u ser knows that all other users will equip

within a defined time horizon because full benefits of ADS-B will not be realized until a sizable percent of aircraft are equipped within a g iven airspace. Specifically, stakeholder analysis of whether to equip voluntarily will not t ake into account positive externalities that equipage will have on other stakeholders. The se externalities create a “last mover advantage” because users who equip prior to other u sers will have to wait longer and face8

greater uncertainty before seeing a full return on their investment. As a result, users will have incentives to delay ADS-B equipage, and there is a significant risk that the aviation system will never achieve the critical mass of ADS- B-equipped users that is needed to generate benefits. The rule will correct this mark et failure.

The delay reduction and fuel savings generated for users of ADS-B (and the “performance-based” NAS that it enables) depend hig hly on extensive adoption among users. According to a recent study, “without exten sive equipage adoption among airlines ... ADS-B therefore offers little value except in cas es where an airline is a heavy user of an ADS-B equipped hub and can gain value from reduc ed separation between its own aircraft and improved management of surface traffic .” 4

In other words, the financial analysis for an indiv idual firm or individual pilot is very different from the industry-wide analysis. An indi vidual will bear a full share of the equipage costs but will only receive benefits if a substantial number of other users in the airspace in which that firm operates also equip.

This introduces two factors with negative impacts o n any individual firm’s analysis of ADS-B: delayed benefits and uncertainty. If some o ther users in the relevant airspace have not yet committed to ADS-B, any firm consideri ng ADS-B will know that benefits will not fully realized until the other users adopt the technology—assuming those users choose to adopt the technology at all. In a financ ial environment where the aviation industry requires extremely fast returns on capital investments, individual stakeholders will likely heavily discount future returns both fo r the time value of money and for the uncertainty over whether those benefits will arise at all. Many stakeholders may only consider the very limited known benefits that they will achieve, assuming no action by other users; these benefits, as noted above, are un likely to be sufficient to justify the capital investment. The impact to the rest of the industry from enabling others to achieve

benefits will not be considered in an individual fi rm’s analysis.

Those who install ADS-B late in the adoption proces s will be, in essence, “free riders” because they will receive many of the benefits as t hose who installed earlier in the process, but will have invested less cost on a pres ent value basis, since the time between investment and payback will be significantly shorte r. Furthermore, those who install ADS-B early in the adoption process will not only h ave to bear the cost of capital for that investment, but the cost of the equipment, installa tion and maintenance may be higher due to manufacturers being in the steep part of the learning curve.

An appropriately-structured government mandate, com bined with government investment in the necessary air traffic control infrastructure such as ADS-B ground stations (another precondition for achieving user benefits), can addr ess this market failure by eliminating uncertainty associated with user benefits. With a known mandate deadline, users can make an undistorted evaluation of the optimal time to equip. The mandate provides

4 Marais, Karen and Annalisa L. Weigel, “Encouraging and Ensuring Successful Technology Transition in Civil Aviation,” Department of Aeronautics and Astr onautics, Massachusetts Institute of Technology, Cambridge, MA, March 2006. http://esd.mit.edu/wps/esd-wp-2006-07.pdf9

certainty that other preconditions necessary to ach ieve benefits will be met even though they are out of an individual user’s control.

Because of the rule industry knows that everyone wi ll have to equip by a specified time period and the FAA will have to install the necessa ry ground equipment early to meet the rule’s compliance date. Some operators will equip early because they will be able to achieve benefits early. Some may equip early becau se of when their aircraft is due for maintenance cycle (it is more cost effective to ins tall the avionics when they send the aircraft out for a major maintenance cycle which th ey do every 5 years), and some may equip early to get the experience with the system.

In summary, mandating ADS-B Out equipage to operate in designated airspace is necessary because market failures will otherwise di ssuade individual users from adopting the technology that will generate net benefits for society. The issues these market failures generate include an incomplete accounting of societal benefit, a potential time lag between a firm’s investment and benefits, and uncer tainty about whether those benefits will be achieved at all. Government action is requ ired in order to achieve the capacity, safety, and efficiency benefits of ADS-B.

The FAA currently believes it would be premature to mandate ADS-B In equipage, because standards to accommodate air-to-air applica tions are not in place yet. In the future, the agency expects to move forward with red uced separation standards and possibly allow some self-separation, and at that po int further rulemaking may be

warranted.

2.4 General Assumptions for the Benefits Analysis a nd Government Cost Analysis

The following general assumptions are used in the a nalysis. Scenario- and benefitspecific assumptions are listed later within the in dividual sections.

• All costs and benefits are denominated in 2009 doll ars.

• The final rule will be published in 2010 and have a compliance date of 2020.

• Present value rates are 3% and 7%. 5

• Costs that are consistent across scenarios are not included. For instance, primary

radar will be maintained across all scenarios and t herefore the cost to continue primary radar is not included in any scenario. We assume that all NAS infrastructure costs other than surveillance, such as cost of runw ays, runway extensions and air

traffic control facilities are the same across all the scenarios and we assume that all

5 Except for discounting of the social cost of carbo n which uses 5% for the low value and 2.5% for the high value, as noted in the interagency report titled “H ighlights of Appendix15A: Social Cost of Carbon for Regulatory Impact Analysis under Executive Order 12 866.”10

NAS personnel costs are the same across scenarios. Therefore we do not consider these costs in any of the scenarios.

• Period of Analysis: 2009-2035.

• The agency intends to provide ADS-B services where radar surveillance exists today (plus the Gulf of Mexico and areas in Alaska). We may in the future decide to implement ADS-B services in other areas. However, for the purpose of the regulatory impact analysis, we assume ADS-B surveil lance and broadcast service will only be provided in areas where we have radar today , plus the Gulf and Juneau.

• The ADS-B ground infrastructure and rules and proce dures will be in place by 2013 to support the following applications and services.

Services:

• ATC Surveillance, and

• FIS-B and TIS-B and ADS-R.

Applications:

o Final approach runway occupancy awareness,

o Enhanced visual acquisition,

o Enhanced visual approach,

o Airport surface situational awareness, and

o Conflict detection.

• For the purposes of the regulatory impact analysis we assume that current separation

standards will be maintained in radar surveillance airspace 6 . However, the FAA is investigating whether and to what extent ADS-B may allow the FAA to reduce separation standards.

• Once ADS-B Out is implemented in the Gulf of Mexico and assuming a 5 mile separation standard is approved based on ADS-B Out data being available for separation purposes, the hourly capacity for sector s in the Houston CTA 7 /FIR 8 is

estimated to increase from 56 to 84 aircraft. This capacity is higher than that used in

the NPRM because of additional routes and resectori zation. 9 Also, additional capacity at key airports in Mexico is expected to b e complete soon and this will

further alleviate the constraints built into the or iginal capacity gains.

6 With the implementation of ADS-B application of rad ar separation standards can now be applied in the non-radar airspace of the Gulf Of Mexico.

7 Control Area: A control area is airspace wholly co ntained beyond the 12 mile limit whereby an ICAO state has been designated as the ATS authority for the control of air traffic.

8 Flight Information Region: FIR’s designate regions for informational services only, not ATC control.

9 Houston, Merida, and Monterrey Centers are close t o finalizing a new RNP-10 route structure that will add additional routes and capacity. Additionally, Houston and Merida Center are planning to resectori ze airspace to more efficiently handle GOMEX traffic a nd increase capacity.11

• We assume that low-altitude operations over the Gul f of Mexico will be equipped with ADS-B Out because of a Memorandum of Agreement (MOA) 10 signed by the FAA and helicopter operators, among others, and not because of the rule. The platform/helicopter companies have agreed to equip with appropriate avionics and equipment to take advantage of FAA enhancements to the communications, weather reporting, and surveillance capabilities outlined i n the Agreement. The FAA will install ground equipment under the MOA. The MOA is to be renewed every five years. Therefore we do not include the costs and b enefits of low altitude operations

over the Gulf of Mexico as a function of the rule.

• We assume there will be no self-separation.

• While there may be some improvements in air traffic controller productivity with ADS-B Out, we are unable to quantify any improvemen t at this point.

2.5 Definition Of Scope

The ADS-B Out scenario analysis includes user costs incurred and benefits attained due to the final rule, as well as the costs incurred by the government to deploy and maintain a surveillance system. Costs and benefits that will occur without the rule are not included in the analysis. Costs that are incurred in antici pation of the rule are included, as are the benefits resulting from those expenditures.

3.0 Definition Of Approach

In the following sections we present costs and bene fits of the following scenarios:

• A radar baseline scenario to represent current surv eillance practice and a universe without the final rule,

• ADS-B Out scenario to represent the final rule,

• Multilateration as a surveillance alternative to AD S-B.

We compare the costs and benefits of the ADS-B Out scenario with those of the baseline

scenario to derive the incremental costs and benefi ts of ADS-B Out. The multilateration

and baseline scenarios demonstrate an alternative t o the ADS-B Out scenario.

10 Memorandum of Agreement between Federal Aviation A dministration, and Helicopter Association International, Platform/Helicopter companies, Platf orm Owners and Helicopter Operators to Enhance Communication, Weather and Surveillance Capabilitie s Gulf of Mexico.12

4.0 Scenarios Analyzed

4.1 No-Rule Baseline Scenario

4.1.1 Definition

The baseline scenario is the no-rule scenario. Und er this scenario we maintain the current radar-based surveillance system, and replac e radar facilities once they wear out. This scenario assumes no expansion beyond the curre nt Operational Evolution Plan (OEP).

This section presents the cost of continuing full r adar surveillance, which we compare to

alternative scenarios. It assumes that all other c omponents of the air traffic system

remain constant over the scenarios and therefore th ese costs are not included. These components include runways, air traffic facilities and personnel. Also, we assume the cost of primary radars and precision runway monitor ing systems will be constant across

all scenarios and therefore we do not include them.

4.1.2 Cost to Aircraft Operators of the Baseline Sc enario

There will be no direct cost to aircraft operators because they are already equipped to operate under the current radar-based system.

4.1.3 Cost to FAA of Continuing Full Radar Surveill ance Under the Baseline

Scenario

Surveillance

Airborne Surveillance Radar

With this scenario we include the cost of continuin g to support all classes of airborne secondary (beacon) radars (i.e. terminal and en rou te), and surface surveillance radar and the cost of replacing these radars at the end of th eir life cycles. 11

The specific secondary surveillance radar includes BI4, BI5, BI6 and Mode S radar. The ASR-11 (primary/secondary surveillance radar) is a terminal air traffic control radar system that replaces current analog systems with ne w digital technology. These costs are also included. The ASR-11 system consists of two e lectronic subsystems: primary surveillance radar and secondary surveillance radar sometimes called the beacon.

Surface Surveillance Radar

Surface surveillance radar includes Airport Surface Detection Equipment (ASDE-3 and ASDE-X/3X). ASDE-3 provides radar surveillance of aircraft and airport surface vehicles at high activity airports. ASDE-3 is a pr imary radar for surface surveillance and

11 Exhibit 300 Attachment 2, Business Case Analysis R eport - Future Surveillance, JRC Phase 2A, pg. 35.13

is combined with the Airport Movement Area Safety S ystem (AMASS ) software which provides conflict alerts based on ASDE-3 surveillan ce data.

ASDE-X is a traffic management system that fuses in formation from radar, multilateration and other sensors, for the airport surface that provides seamless coverage

and aircraft identification to air traffic controll ers. The system uses a combination of surface movement radar and transponder multilaterat ion sensors to display aircraft position labeled with flight call signs on an ATC t ower display. The costs of ASDE-3,

ASDE-X/3X and AMASS are included below.

The cost to sustain and replace airborne and surfac e radar, assuming there is no ADS-B Out, would be $2.9 billion 12 ($1.2 billion when discounted by 7%) over the year s 2009 to 2035. The aggregate costs by year are presented in Table 2 below.

Table 2 Cost to Sustain and Replace Radar without ADS-B Out 2009K $

Source: FAA SBS Program and Terminal Surveillance

12 The FAA developed these estimates internally.14

We assume the life cycle of the current ground-base d surveillance systems is 20 years

from their initial service. 13

4.1.4 Benefits

There is one benefit of the baseline scenario relat ive to the other alternatives, and that is certainty. We know it works with today’s margin of safety.

4.2 ADS-B Out – The Final Rule (Preferred Alternati ve)

4.2.1 Definition

Under this scenario, aircraft operators will equip to meet the performance requirements of

the rule. The FAA will make surveillance services available based on down-linked

aircraft information.

Costs presented in this section will be borne both by the FAA and industry. The FAA has been incurring costs to install ground facilities i n order to provide ADS-B services. Costs

incurred before 2009 are considered sunk costs and are not included in the FAA costs of the rule presented in this report. We assume indus try will begin incurring costs in 2012.

4.2.2 Requirements of the Rule

The rule requires that no person may operate an air craft in the following airspace unless that aircraft meets ADS-B Out performance requireme nts laid out in the final rule unless otherwise authorized or directed by air traffic con trol (ATC).

• Class A, Class B, and Class C airspace areas, and i n the Class E airspace at and above 10,000 ft MSL over the 48 contiguous United S tates and the District of Columbia, excluding the airspace at and below 2,500 ft above ground level (AGL).

• U.S. airspace over the Gulf of Mexico, which is fro m the coastline of the United States out to 12 nautical miles at and above 3,000 feet MSL.

• Within 30 nautical miles of an airport listed in 14 CFR, Part 91, Appendix D, from the surface upward to 10,000 feet MSL.

However, the rule will permit aircraft not original ly certificated with an engine-driven electrical system or not subsequently certified wit h such a system installed (such as a balloon or glider) to conduct operations without AD S-B Out in the airspace within 30 nautical miles of an airport listed in Appendix D i f the operations are conducted: (1) outside any Class B or Class C airspace area; and ( 2) below the altitude of the ceiling of a Class B or Class C airspace area designated for an airport or 10,000 feet MSL, whichever

is lower.

13 Exhibit 300 Attachment, Business Case Analysis Rep ort for Future Surveillance, JRC Phase 2A, pg. 5.15

While in the affected airspace, each person operati ng an aircraft equipped with ADS-B Out must operate this equipment at all times in the transmit mode, including when on the airport surface.

4.2.3 Industry Estimation of ADS-B Equipage Costs

4.2.3.1 Introduction

Despite some significant changes between the NPRM a nd final rule language, there has been very little change in the total compliance cos ts. The seven percent present value base-case cost in the NPRM is $2.1 billion and in t he final rule is $2.3 billion.

This section starts with a discussion of the change s between the NPRM and final rule

which affect the ADS-B Out estimated total costs. Next, we define a set of assumptions used to estimate ADS-B Out costs for equipping airc raft in the NAS. We then discuss the

derivation of the future affected U.S. aircraft fle et. Next, we explain the methods used to estimate ADS-B Out equipage costs on transport cate gory turbojet, turboprop and General Aviation (GA) aircraft. Lastly, we follow the ADS-B Out cost discussion with an estimate of the cost savings from learning curve efficiencies and additional maintenance and operating 14 costs.

Industry has commented that there remains some ambi guity related to the performance

standards because the RTCA documents and associated Technical Standard Orders (TSOs) were not finalized. The final determination , at the time of this analysis, is

unknown. These cost estimates are based on industr y’s understanding of the performance characteristics discussed in RTCA meetings up to Ju ne 2009. Any significant changes in the performance characteristics could have an impac t on the estimated ADS-B Out equipage costs provided in this analysis.

NPRM and Final U.S. Fleet, Unit Costs, and Estimate d Total Cost Changes

This section discusses changes between the NPRM and final rule which affect the ADS-B

Out estimated costs.

The three changes between the NPRM and final rule a re:

• U.S. fleet,

• ADS-B Out unit cost, and

• ADS-B Out estimated total cost.

We estimated the changes to the U.S. fleet by compa ring the number of aircraft during the NPRM and final rule analysis for the forecasted years of 2012 and 2025. In this final rule analysis, the large category turbojet fleet dr opped 21.47 percent in 2012 and dropped 12.47 percent in 2025 from that of the NPRM. The r egional turboprop fleet dropped

14 The operating costs consist of additional fuel bur n caused by the weight of hardware mandated by this

final rule.16

17.15 percent in 2012 and 22.5 percent in 2025. Th ese two declines occurred because of the downturn in the economy. Lastly, in this final rule analysis, the GA fleet rose onethird of a percentage in 2012 and another two perce nt in 2025. Table 3 details these

results.

Table 3

ADS-B Out unit costs for modern large category turb ojet airplanes were similar for the NPRM and the final rule. For the older large categ ory turbojet airplanes (DC-9/10, 737 classics, A300, etc.) industry reported the final r ule unit costs rose between 20-30 percent from those in the NPRM. One reason for the higher unit costs may be the need to recoup high fixed costs as many older airplanes have been parked or retired. To recoup their initial development costs and with fewer large cate gory turbojet airplanes in the fleet, the unit costs rose. Another reason for the higher uni t costs is that in the NPRM, our lower bound ADS-B Out equipage cost estimate should have included the cost of aircraft

manufacturer’s service bulletins.

Regional turboprop ADS-B Out unit costs between the NPRM and final rule were similar. The ADS-B Out unit costs for GA piston en gine airplanes and rotorcraft dropped 10-15 percent. With more ADS-B Out providers in th e marketplace and the FAA relaxing the antenna diversity costs GA unit costs dropped. Lastly, ADS-B Out unit costs for GA turboprop and turbojet engine aircraft incre ased by 20-30 percent. We do not have a reason for this price increase.

For the base-case scenario, ADS-B Out estimated fin al rule total costs for modern large category turbojet airplanes, relative to those in t he NPRM, were up about 20 percent. Including the cost of manufacturer’s service bullet ins in the lower bound estimates largely explains the increase in the base-case cost s. Regional turboprops ADS-B Out final rule total costs dropped about 90% in the fin al rule because ADS-B Out costs will be prohibitive for analog/hybrid regional turboprop airplanes. The final rule assumed that analog/hybrid regional turboprop airplanes wil l be retired prior to the rule’s effective date. The cost to retire an analog/hybrid regional turboprop early is much less than retrofitting with ADS-B Out. Lastly, ADS-B Out est imated final rule total costs for GA turboprop and turbojet engine aircraft decreased fr om the NPRM by about 15 percent because of the drop in unit costs for GA piston eng ine airplanes.17

4.2.3.2 Equipage Cost Assumptions

The ADS-B Out equipage cost evaluation for this fin al rule makes the following assumptions:

1. The base year is 2009.

2. This final rule will be published in 2010.

3. The analysis period extends for 27 years from 2009 through 2035.

4. Compliance date is 2020.

5. The ADS-B ground infrastructure will be in service and fully operational by

2013. 15

6. Manufacturers will invest in equipping newly delive red aircraft after a federal commitment of two appropriation-funding cycles.

7. Manufacturers of large category turbojet or regiona l turboprop will start equipping ADS-B Out avionics on new aircraft delive ries in 2012 16 because it will be cheaper to purchase new aircraft with the avioni cs installed than to retrofit in

2020.

8. Large category turbojet and regional turboprop airc raft will start retrofitting active

aircraft in 2013 in order to minimize costs associa ted with retrofitting the aircraft outside of its heavy maintenance cycle. All active large category turbojet and regional turboprop aircraft will be fully equipped with ADS-B Out by 2020.

9. GA aircraft and Rotorcraft will start equipping new aircraft deliveries in 2012 and retrofitting active aircraft in 2013. All active G A and Rotorcraft aircraft will be fully equipped by 2020.

10. All U.S.-certificated large category turbojet or re gional turboprop passenger and cargo aircraft will equip with ADS-B Out because th ey will operate in the airspace required by this final rule.

11. Active U.S.-certificated GA aircraft and Rotorcraft currently equipped with transponder equipment 17 will equip with ADS-B Out equipment because they w ill operate in the final rule’s affected airspace. Ope rators of GA aircraft without ADS-B Out transponder equipment could request ATC d eviations prior to operating in the airspace affected by this final ru le. Table 4 shows the current

number of U.S.-certificated GA aircraft and Rotorcr aft with transponder equipment:

Table 4

15 http://www.faa.gov/news/speeches/news_story.cfm?ne wsId=7649

16 2013 is dependent on the appropriate funds being a vailable from assumption 6.

17 2006 FAA General Aviation and Air Taxi Survey.18

12. Experimental, Sport and Other aircraft will not equ ip with ADS Out. Operators of these aircraft could request ATC deviations prio r to operating in the airspace affected by this final rule. 18

13. Equipment costs are based on catalog pricing.

14. The analog/hybrid regional turboprop airplanes will not select an upgrade because the upgrade cost will be prohibitive.

15. We accept industry’s performance-based cost estimat es. 16. The FAA assumes that only 20% of analog large categ ory transport turbojet airplanes will choose to equip with ADS-B Out capab ility because the upgrade cost will be prohibitive.

4.2.3.3 Fleet Discussion

This section discusses the fleets that will need to comply with the final rule in the future. The discussion draws upon forecasts covering the pe riod from 2009 through 2025, as

well as extended forecasts for 2026-2035. The sect ion begins with a discussion of the expected affected airplanes, and then discusses in detail the derivation of the future affected fleet of large category turbojet, regional turboprop, general aviation and

rotorcraft.

Large Category Turbojet Aircraft

The 2009 published FAA turbojet fleet annual unit f orecast for 2009 to 2025 forms the basis for estimating the number of affected large c ategory turbojet aircraft. This forecast covers wide body, narrow body and regional turbojet aircraft operated by US-certificated

carriers and includes new deliveries and retirement s. A bottom-up forecast was developed for each aircraft group and then summed t o arrive at an aggregate. To estimate the large category turbojet fleet after 2025, we us e the FAA long-term passenger turbojet

fleet annual unit forecast for 2025-2035. These fo recasts project the population of large category and regional turbojets to nearly double in the analysis interval.

Regional Turboprop Aircraft

The 2009 published FAA turboprop fleet annual unit forecast for 2009 to 2025 19 forms the basis for estimating the number of affected reg ional turboprop aircraft. This forecast categorizes regional turboprop aircraft by the numb er of airplane seats, operated by UScertificated carriers, and includes new deliveries and retirements. A bottom-up forecast was developed for each aircraft group by seat and t hen summed to arrive at an aggregate.

18 ibid.

19 FAA Aerospace Forecast 2009-2025, Table 21 & 21.19

We estimated the regional turboprop fleet from 2026 -2035 by using the 10-year average percent change from the 2010-2020 period. The FAA projects that the number of regional turboprop aircraft to decline about five p ercent from 2009 to 2035. 20

General Aviation Aircraft

The 2009 published FAA general aviation fleet annua l unit forecast for 2009 to 2025 forms the basis for estimating the number of affect ed general aviation aircraft. These forecasts cover fixed wing, rotorcraft, experimenta l, sport and other general aviation aircraft operated by US certificated carriers and i ncludes new deliveries and retirements. We extended the general aviation fleet from 2026-20 35 by using the 10-year average percent change from the 2010-2020 period. 21 We project the number of fixed wing general aviation aircraft will increase approximate ly 13 percent and the number of rotorcraft to nearly double.

4.2.3.4 Equipment Specifications

This section describes the new standards used herei n to estimate the compliance cost for ADS-B Out avionics this final rule requires. The AD S-B Out system will consist of a position source, an ADS-B transmitter, altimetry se nsors, flight crew interfaces and other avionics. This equipment will require integration t o correctly transmit the ADS-B Out

data.

In the United States, two different datalinks have been adopted for ADS-B Out:

o 1090 MHz Extended Squitter (1090 ES), and

o 978 MHz Universal Access Transceiver (978 UAT).

TSO-C166b defines the equipment requirements for 10 90ES ADS-B equipment. TSOC154c defines the equipment requirements for UAT AD S-B equipment. Future versions of these TSO’s will be acceptable for rule complian ce however, previous versions of the TSO’s are not acceptable to operate in airspace def ined by 14 CFR 91.225.

This is a performance-based rule, and thus there is no equipment requirement for the position source. Any position source meeting the a ccuracy and integrity requirements described in 14 CFR 91.227 is acceptable. Based on responses from industry, three types of position sources have been evaluated for costs i ncluding Global Navigation Satellite System (GNSS) equipment compliant with Technical St andard Order (TSO) C145a or TSO-146a, GNSS equipment compliant with TSO-C129a, and GNSS equipment compliant with TSO-C196.

20 FAA Aerospace Forecast 2009-2025, Table 26. “U.S. Regional Carriers Passenger Aircraft”.

21 FAA Aerospace Forecast 2009-2025, Table 27. “Activ e General Aviation and Air Taxi Aircraft”.20

The minimum broadcast message element set for aircr aft equipage for ADS-B Out used

in the cost estimates defined below. 22

Each aircraft must broadcast the following informat ion, as defined in TSO–C166b or TCS–C154c. The pilot must enter information for me ssage elements listed in (7) through (10) of this section during the appropriate phase o f flight: (1) The length and width of the aircraft; (2) An indication of the aircraft’s lateral and l ongitudinal position; (3) An indication of the aircraft’s barometric pr essure altitude; (4) An indication of the aircraft’s velocity; (5) An indication if TCAS II or ACAS is installed and operating in a mode that can generate resolution advisory alerts; (6) If an operable TCAS II or ACAS is installed, an indication if a resolution advisory is in effect; (7) An indication of the Mode 3/A transponder cod e specified by ATC; (8) An indication of the aircraft’s call sign tha t is submitted on the flight plan, or the aircraft’s registration number; (9) An indication if the flight crew has identifi ed an emergency, radio communication failure, or unlawful interference; (10) An indication of the aircraft’s “IDENT” to A TC; (11) An indication of the aircraft assigned ICAO 24-bit address; (12) An indication of the aircraft’s emitter cate gory; (13) An indication of whether an ADS–B In capabil ity is installed; (14) An indication of the aircraft’s geometric al titude; (15) An indication of the Navigation Accuracy Cat egory for Position (NACP); (16) An indication of the Navigation Accuracy Cat egory for Velocity (NACV); (17) An indication of the Navigation Integrity Ca tegory (NIC); (18) An indication of the System Design Assurance (SDA); and (19) An indication of the Source Integrity Level (SIL).

4.2.3.5 ADS-B Out Equipage Cost Estimate

We contacted manufacturers, industry associations, and ADS-B equipage providers and requested estimates for ADS-B equipage and installa tion costs. We requested estimates of airborne installation costs, by aircraft model, for the output parameters listed in the Equipment Specifications section. The manufacturers and industry associati ons we contacted were:

• Airbus,

• Aircraft Owners and Pilots Association,

• Aviation Communication and Surveillance Systems,

• Boeing,

• Free Flight Systems,

• Garmin,

22 § 91.22721 • General Aviation Manufacturers Association,

• Honeywell,

• National Business Aviation Association,

• Raytheon, and

• Rockwell.

Not every manufacturer or ADS-B equipage provider w e contacted responded to our ADS-B cost request. For those that did respond, ea ch used a different methodology to develop their cost estimates. The differences in me thodologies could be partially responsible for the variance in our cost estimates. These industry representatives have been actively involved in the performance requireme nts process. They are well aware of current and potential changes to the performance re quirements.

For analytical purposes, we grouped aircraft types into classes with similar avionics architecture. The aircraft equipment classes potent ially subject to the ADS-B Out performance requirements are:

• Large Category Turbojet Airplanes

o Classic – B-707, B-727, B-737-100/200, B-747-100/20 0/300, A-300/310, DC-8, DC-9, DC-10, MD-80/81/82/83 and L-1011.

o Neo-Classic – B-757-200/300, B-767/200/300, B-737-3 00/400/500/600, B-747-400, MD-11, MD-87/87/90 and A-319/320/321/340

.

o Modern – B-777, B-737-700/800/900, B-717, B-767-400 , A318/330/350/380.

o New production aircraft.

• Regional Aircraft

o Jet – BAE-146, RJ70 and RJ85, CRJ100/200/440/700, D o328JET, ERJ135/130/145/170/175/190/195, and F28/50/70/100.

o Turboprop – ATR42/72, Beech 99/1900, DHC-8, Do328, EMB-120, Jetstream J31/41/42, L-188, Metro Saab 340 and Shor ts 330/360.

o New production aircraft.

• GA

o Single engine Piston - Airplanes with a maximum tak eoff weight under 12,500 pounds.

o Multi engine Piston – Piston powered airplanes with more than one engine.

o Turboprop – Single and multi-engine turboprop airpl anes.

o Turbojet - Single and multi-engine jet airplanes.

o Rotorcraft - Single and multi-engine helicopters.

o New production aircraft.22

For each aircraft class listed above, we categorize d the aircraft’s ADS-B equipage status into three distinct groups.

• Not Equipped – aircraft is not equipped for ADS-B O ut functionality and requires major avionics component additions or equi pment to make it capable of transmitting ADS-B Out information.

• Latent – aircraft that can be made capable of ADS-B Out operation by adding broadcast link capabilities or interfacing to exist ing Global Navigation Satellite System (GNSS) equipment.

• Equipped – aircraft that can be ADS-B Out capable w ith a software update.

We provide a low and high range of cost estimates a ssociated with various operational and technical issues. The dollar value ranges cons ist of a wide variety of avionics within each aircraft group. The aircraft architecture wit hin each equipment group can vary, causing different carriage, labor and wiring requir ements for the installation of ADS-B Out equipment. Volume discounting versus single li ne purchasing also affects the dollar value ranges.

This rule does not require specific equipment; rath er the equipment must meet certain performance specifications. Since this is a perfor mance-based rule, industry may choose how to meet that performance standard with either a low or high cost of compliance alternative. A minimum equipment set that represen ts the expected minimum compliance may cost more in the future because it lacks upward compatibility. The low end estimate may include a minimum equipment option, a minor sof tware upgrade, an Original Equipment Manufacturer (OEM) option change or a gro und-based backup solution. The high end estimate includes the airborne design that integrates both ADS-B Out capability and provisions for future ADS-B and may also includ e a new or upgraded position source, a new installation or upgraded avionics sys tem necessary to comply with the rule, or a system that will provide a cost-effective opti on for manufacturers and operators to integrate future GNSS 23 upgrades. 24 The base-case estimate represents a fleet where about half of the airplanes need only the low cost solutions and the other half of the airplanes are outfitted with the more expensive upg rades.

We did not include ADS-B Out operator training cost s because we assumed the costs to

be minimal. 25

23 Future upgrades of GNSS might include greater avai lability or accuracy of the signals. These types o f upgrades may enable additional applications, improv ed use of existing applications (such as increased efficiency or availability of ADS-B enabled operati ons) or a reduction in aircraft separation; but wha t those applications are will be difficult to ascertain at this point. Generically speaking, an incremental improvement in the performance of the position sour ce could allow us to incrementally improve our air traffic control procedures and thereby improve effi ciency and capacity.

24 Even though this scenario is designed to look at A DS-B Out adoption in isolation, in practice the availability of equipment offering only ADS-B Out t echnology may be limited. Therefore, in practice t he cost of adopting ADS-B Out may include the voluntar y or unavoidable purchase of some functionality not strictly required by the ADS-B Out regulation.

25 The FAA determined training costs will be minimal because no significant training will be required.23

Large Category and Regional Turbojet ADS-B Out Equi pment and Fuel Burn Costs

This section first covers the estimated ADS-B Out e quipage costs plus the cost of additional fuel burn to large category and regional turbojets due to the added weight of ADS-B Out equipment.

The manufacturers provided us with ADS-B Out equipa ge costs estimates either by equipment type or for the following equipage types:

• Classic,

• Neo-classic, and

• Modern.

The manufacturers who provided costs by equipment g roups either estimated a total cost of ADS-B Out hardware, included the costs of instal lation kits and installation, or provided detailed breakdowns of the various costs.

The ADS-B Out equipment costs for large category an d regional turbojet airplanes are straightforward. Industry provided ADS-B Out unit costs by the equipment class units

discussed in the Fleet Discussion section. The FAA assumes that only 20% of analog air transport turbojet airplanes will choose to equip w ith ADS-B Out capability because the upgrade cost will be prohibitive.

To satisfy the manufacturers’ request to keep indiv idual aircraft pricing confidential, we calculated a low and high range for unit costs by d ividing the total low and high cost estimate by the number of affected large category t urbojet airplanes. This range includes

cost for all hardware and installation. The unit c osts for large category turbojet airplanes range from about $19,000 to $1.7 million. The doll ar value ranges consist of a wide variety of avionics within each aircraft group. Th e avionic costs vary based on the state of an aircraft’s architecture, volume discounting, a minor software upgrade versus a major transponder or position source replacement, o r an operator’s decision to install avionics that take advantage of future GNSS upgrade s. 26 We note that in the NPRM, our

lower bound ADS-B Out cost estimate should have inc luded the cost of aircraft

manufacturer’s service bulletins.

For 2012 through 2035 we estimated the newly delive red turbojet costs by multiplying unit costs by the annual number of new aircraft del iveries. Based on the FAA turbojet forecast, the retrofitting of aircraft in the curre nt operating fleet as of 2013 was assumed to be uniformly distributed over 2013 through 2019. For each of the seven years, ADS-B Out retrofit costs for turbojets were estimated by multiplying unit costs by one-seventh of

26 The result of these different compliance decisions was a wide range of cost estimates.24

the active 2013 fleet. The new turbojet aircraft d eliveries from 2012-2035 were assumed to have avionics component additions or equipment t o make them capable of transmitting

ADS-B Out information. The incremental costs we es timated for these new deliveries

included either minor additional avionic or softwar e upgrade.

The total cost to equip active and newly delivered turbojets from 2012 through 2035 ranges from about $1.0 billion to $2.4 billion with a base-case average of $1.7 billion. Table 5 summarizes the range estimate in constant d ollars, and at three and seven percent present value rate for large category and regional turbojets. 27

Table 5

The ADS-B Out equipage weight ranges from a low of three pounds to a high of 12 pounds. 28 The base-case assumes 7.5 pounds of added weight per turbojet aircraft. We used these weights to calculate a cost range for th e average additional fuel burn for turbojet airplanes operating during the analysis pe riod.

Given that fuel burn range, we used the methodology for incremental fuel burn, per flight, per pound of additional weight for turbojet aircraft from our published economic

values. 29 We obtained the average annual cycles per turboje t aircraft from BACK Aviation Solutions. The gallons of additional fuel burn equals the incremental fuel burn per flight, per pound, multiplied by the average an nual cycles (flights) multiplied by the low, base-case and high added weight estimates. La stly, we multiply the estimated additional gallons of fuel burn by the jet fuel pri ce forecast 30 to obtain a range of the annual cost of the added weight to the U.S. operate d turbojet fleet.

A range of the estimated added fuel burn costs for the installation of ADS-B Out in US operated large category and regional turbojets for 2009 - 2035 is shown in the Table 6.

27 Discussions with ADS-B Out providers. See section 4.2.3.5 ADS-B Out Equipage Cost Estimate for

further detail.

28 The manufacturer mentioned the worst case could be up to 200 additional pounds of weight for a minimally equipped, analog aircraft attempting to b e fully compliant with future navigation and surveillance upgrades. It is highly unlikely that anyone will choose to invest the money to upgrade t heir aircraft to that level of capability when it is lik ely to be retired before an operator could recover the

investment.

29 “Economic Values for FAA Investment and Regulatory Decisions, A Guide ”, December 31, 2004.

30 FAA Aerospace Forecast 2009-2025, Table 18. “U.S. MAINLINE AIR CARRIER FORECAST

ASSUMPTIONS – Jet Fuel Prices”.25 Table 6

Regional Turboprop Aircraft ADS-B Out Equipment Cos ts

This section explains how the regional turboprop ai rcraft ADS-B Out equipment costs were estimated. We also explain why there is no ad ditional fuel burn expense and why the costs to regional turboprops are lower than tho se estimated in the NPRM.

The manufacturers who responded with regional turbo prop equipage costs provided us with costs estimates for the following equipage typ es:

• Saab 340,

• ATR,

• Regional Turboprop, and

• New Production Turboprop.

For these equipment groupings they provided the fol lowing detailed cost estimates by equipment class:

• Transponder and GPS Status,

• GNSS Equipage Cost,

• Datalink Equipage Cost,

• Installation Cost,

• Currently Installed Transponder upgrade cost,

• Installation Kit Cost, or

• Individual Component Cost.26

The ADS-B Out equipment costs for regional turbopro p airplanes are straightforward. Industry provided ADS-B Out unit costs by airplane equipment class units discussed in

the Fleet Discussion section above.

To satisfy the manufacturers’ request to keep indiv idual aircraft pricing confidential, we calculated a low and high range for unit costs by d ividing the total low and high cost estimate by the number of affected regional turbopr op airplanes. This range includes cost

for all hardware and installation. The unit costs for regional turboprop airplanes range from about $12,000 to $466,800. The dollar value r anges consist of a wide variety of avionics within each aircraft group. The avionic c osts vary based on the state of an aircraft’s architecture, volume discounting, a mino r software upgrade versus a major transponder or position source replacement, or an o perator’s decision to install avionics that take advantage of future GNSS upgrades.

It is unlikely that the analog/hybrid regional turb oprop airplanes will select an upgrade because the upgrade cost will be prohibitive. We c onsulted with industry about the active analog/hybrid regional turboprop fleet and were inf ormed that these turboprops operated with less than 40 seats. Therefore, for the final rule, we assume active analog/hybrid regional turboprop aircraft, under 40 seats, will n ot upgrade with ADS-B Out and will retire early.

We consulted with appraisal companies 31 and determined the annual residual value of regional turboprop, under 40 seats, depreciate betw een seven to 14 percent, with a basecase of 10 percent. We obtained the current value of regional turboprop aircraft under 40 seats from our published economic values, 32 applied the residual value depreciation and included the costs of early retirement of the analo g/hybrid regional turboprops to the costs of retrofitting and equipping regional turbop rops for this final rule.

These costs included the early retirement of active analog/hybrid regional turboprop airplanes and the equipage of active and new produc tion regional turboprop aircraft. The active aircraft in 2013, from the FAA turboprop for ecast, were uniformly distributed over 2013 through 2019. For each of the seven years, AD S-B Out costs for regional turbojets were estimated by multiplying unit costs by one-sev enth of the active 2013 fleet.

The manufacturers did not provide an equipage weigh t for ADS-B Out on regional turboprops. In the NPRM, we assumed the weight for an ADS-B Out transponder on regional turboprop aircraft will be about the same as weight as existing transponders and therefore the change will be negligible and there w ill be no additional weight or fuel burn costs. We received no comments about this assumpti on.

The total cost to equip and retire certain regional turboprop aircraft with ADS-B Out from 2012 through 2035 ranges from about $7.5 milli on to almost $41.6 million with a

31 Avitas, ACI

32 “Economic Values for FAA Investment and Regulatory Decisions, A Guide ”, December 31, 2004.27

base-case average of nearly $24.6 million. Table 7 summarizes the range estimate of constant dollars, three and seven percent present v alue rate. 33

Table 7

General Aviation Aircraft ADS-B Out Equipment Costs

This section explains how the final rule’s general aviation aircraft base-case ADS-B Out equipment costs of $2.7 billion were estimated. We used general aviation industry equipment cost estimates, the FAA fleet forecast, a nd assumptions about the current fleet equipped with a transponder. We first discuss the i ndustry cost estimates received. We then discuss our adjustments to the number of affec ted helicopters covered by the Memorandum of Agreement (MOA) between the FAA and t he helicopter association (HAI) and operators. Once the foundation for the g eneral aviation fleet is set, the ADS-B Out cost estimation is straightforward; multiply th e number of affected general aviation aircraft by unit costs.

The manufacturers provided GA ADS-B Out equipage co sts for the following equipage

types:

• Single Engine Piston,

• Multi Engine Piston,

• Turbo Prop,

• Turbo Jet,

• Rotorcraft, and

• Experimental.

33 Discussions with ADS-B Out providers. See section 4.2.3.5 ADS-B Out Equipage Cost Estimate for

further detail.28

For those equipment groups they provided costs for the following categories:

• Equipment Cost,

• Fleet Size,

• Installation Time,

• Installation Hourly Cost,

• Total Cost, and

• Total Fleet Cost.

There is currently a signed Memorandum of Agreement (MOA) between the FAA, the HAI, and helicopter operators for operation in the Gulf of Mexico. In this agreement, helicopter operators in the Gulf of Mexico agree to equip with "appropriate avionics and equipment to take advantage of FAA enhancements to the communications, weather reporting, and surveillance capabilities". The MOA has not yet been implemented, but with a compliance date of 2020 in the final rule, i t is likely the helicopter operators will equip to be in accordance with the MOA before the r equired compliance date of this final rule. For this analysis, we are assuming that 9% o f the active and newly delivered helicopter fleet will be operating in the Gulf of M exico with ADS-B Out equipment voluntarily installed. 34 Therefore, we reason that this portion of the ind ustry will equip without the rule and the compliance costs for the G ulf of Mexico-operated (nine percent of total rotorcraft fleet) rotorcraft will equal ze ro.

To satisfy the manufacturers’ request to keep indiv idual aircraft pricing confidential, we calculated a low and high range for unit costs by d ividing the total low and high cost estimate by the number of affected general aviation airplanes. This range includes cost

for all hardware and installation. The unit costs for general aviation aircraft range from about $5,000 to $20,000. We note that the unit cos ts for GA aircraft are less than those

used in the NPRM because there are more ADS-B manuf actures in the market place. The dollar value ranges consist of a wide variety of av ionics within each aircraft group. The avionic costs vary based on the state of an aircraf t’s architecture, volume discounting, a minor software upgrade versus a major transponder o r position source replacement, or an operator’s decision to install avionics that take a dvantage of future GNSS upgrades.

The methodology to estimate ADS-B Out equipment cos ts for the GA fleet is based on the 2006 FAA General Aviation and Air Taxi Survey, 35 and we calculated the percentage

of U.S. certificated GA aircraft and rotorcraft cur rently equipped with transponder equipment. We applied this percentage to the GA fl eet from the Fleet Discussion section above to determine the number of newly delivered an d active GA aircraft that will equip

with ADS-B Out.

34 Based on conversations with the Helicopter Associat ion International (HAI) and FAA.

35 http://www.faa.gov/data_statistics/aviation_data_st atistics/general_aviation/29

For 2012 through 2035 we estimated the newly delive red GA aircraft costs by multiplying unit costs by the annual number of new GA aircraft deliveries. The retrofitting of aircraft in the current operating f leet as of 2013, from the FAA GA forecast, was assumed to be uniformly distributed o ver 2013 through 2019. For each of the seven years, ADS-B Out retrofit costs, for acti ve GA aircraft was estimated by multiplying unit costs by one-seventh of the active 2013 fleet.

The total cost to equip GA aircraft from 2012 throu gh 2035 ranges from about $1.6 billion to about $3.9 billion with a base-case aver age of $2.7 billion. Table 8 summarizes the range estimate of constant dollars, three and s even percent present value rate.

Table 8

Table 9 shows the distribution of the constant GA c osts by GA engine, turbojet and

rotorcraft aircraft.

Table 9

In the NPRM, we assumed the weight for an ADS-B Out transponder, on a GA aircraft, will be about the same as weight existing transpond ers and therefore the change will be negligible and there will be no additional weight o r fuel burn costs. We requested comments from industry on this assumption. Industr y informed us the ADS-B Out equipage weight ranges from a low of three pounds t o a high of five pounds. 36 The basecase assumes four pounds of added weight per turboj et aircraft. We accept those comments and used these weights to calculate a cost range for the average additional fuel burn for GA aircraft operating during the analysis period.

36 The manufacturer mentioned the worst case could be up to 200 additional pounds of weight for a minimally equipped, analog aircraft attempting to b e fully compliant with future navigation and surveillance upgrades. It is highly unlikely that anyone will choose to invest the money to upgrade t heir aircraft to that level of capability when it is lik ely to be retired before an operator could recover the

investment.30

We obtained the incremental fuel burn, per flight, per pound of additional weight and utilization for GA aircraft from our published econ omic values. 37 The gallons of additional fuel burn equals the incremental fuel bu rn per hour, per pound, multiplied by the average annual utilization, multiplied by the l ow, base-case and high added weight estimates. Lastly, we multiply this product by the jet fuel forecast 38 to obtain a range of the annual cost of the added weight to the U.S. ope rated GA fleet.

A range of the estimated added fuel burn costs for the installation of ADS-B Out in US operated GA fleet for 2009 - 2035 is shown in the T able 10.

Table 10

4.2.3.6 ADS-B In –Turbojet, Turboprop and GA Aircra ft Costs are Premature

An example of an ADS-B In application is United Par cel Service (UPS) and FAA working together to implement a system at Louisvill e, Kentucky (SDF) airport to increase airport capacity and efficiency while sign ificantly reducing vulnerability to runway incursion events, both in terms of events an d the damage sustained should an event occur. UPS and FAA have developed a concept to create a system that will use ADS-B surveillance at SDF, along with a Surface Man agement System and a scheduling and sequencing system to meet the demands of the fu ture. UPS is also installing a Cockpit Display of traffic Information (CDTI) for c ertain proposed operational application such as merging and spacing, Surface Ar ea Moving Management, and CDTI Assisted Visual Spacing capability in all of its B- 757, B-767, B-747-400, A-300, and

MD-11 fleets.

We have attempted to estimate the costs for equippi ng aircraft with the avionics necessary to perform the initial ADS-B In applicati ons described in this rule. At the time of this analysis, there were no FAA specifications for ADS-B In. The FAA anticipates completing a TSO that outlines standards for the in itial ADS-B In applications by the end of fiscal year 2010.

37 “Economic Values for FAA Investment and Regulatory Decisions, A Guide ”, December 31, 2004.

38 FAA Aerospace Forecast 2009-2025, Table 18. “U.S. MAINLINE AIR CARRIER FORECAST

ASSUMPTIONS – Jet Fuel Prices”.31

4.2.3.7 Learning Curve Efficiencies

In 1939, 39 T.P. Wright 40 recognized the repetition of the same operation re sults in reduced efforts expended on that operation. 41 Direct labor man-hours necessary to complete a unit of production will decrease by a co nstant percentage each time the production quantity is doubled. Learning or cost i mprovement occur due to workers increases in efficiency and implicit training. T.P . Wright found that an 80% learning efficiency has been a common occurrence in aircraft production. This section will estimate the learning efficiency 42 cost savings for the installation of ADS-B Out equipment in turbojet, turboprop and GA aircrafts f or an 80% learning efficiency. 43

We estimate the labor hour efficiencies for the pro duction and installation of ADS-B Out on the xth set of airplanes (Y

x ) as follows:

Y

x = a * x b

Where Y

x = cumulative average time to produce and install a number of units, a = time to produce and install the first unit by equipment group, x = the sequential period of production and instal lation time, b = index of learning ( b = log (learning curve) / log (2)), learning curve = 80.

In order to estimate the learning efficiency saving s for providing and installing ADS-B Out on newly delivered and active aircraft, we used the industry-provided hours and Department of Labor 44 hourly labor rates, per equipment group, required to produce and install ADS-B Out. The learning efficiencies begin in 2013 and extend to 2035, the end of the analysis period. Table 11 shows the hours a nd hourly labor rates, per equipment group, required to install ADS-B Out.

39 The learning curve effect states that the more tim es a task has been performed, the less time will be required on each subsequent iteration. This relatio nship was first quantified in 1936 at Wright-Patter son Air

Force Base in the United States. In the late 1960s Bruce Henderson of the Boston Consulting Group (BCG) began to emphasize the implications of the ex perience curve for strategy and in 1972 published “Perspectives on Experience”. This book explains t he experience curve effect, which is an observation that the costs of virtually every class of products decl ine by a constant and predictable percentage over t ime, as a function of experience. Recently, in 1991, Charl es J. Teplitz published the “The Learning Curve Deskbook” which provides a basic understanding of the underlying theory of learning curves, as well a s ready access to commonly used learning curve models , formulas, and tables.

40 Theodore Paul Wright (May 25, 1895 – August 21, 19 70) was a U.S. aeronautical engineer, educator,

and served as administrator of the Civil Aeronautic s Administration during 1944 – 1948.

41 “American Methods of Aircraft Production ”, T.P. Wright, 1939.

42 The rate of learning may be higher than the 80% pre sented in this regulatory impact analysis. If so, the learning efficiencies may be under estimated.

43 80% learning has been a common occurrence for over 65 years since T.P Wright recognized the concept

in 1939.

44 Department of Labor, Bureau of Labor Statistics. Occupational Employment and Wages32 Table 11

Next we summed the new aircraft deliveries for 2012 with the new deliveries and the

one-seventh of the active fleet from 2013 to define the first period of our sequential periods of installation time, x. Our second period of installation time was defined as 2014, our third as 2015 and so on until 2035. The follow graph presents the 80% learning curve for a 30 hour time to produce and in stall the sequential units of newly

delivered and active aircraft.

For each sequential period, we multiplied the numbe r of ADS-B Out installations, by the labor cost, by the labor hours a * x b

. No efficiencies occur in year one because the learning has not yet begun. The majority of the le arning efficiencies occur from 2014- 2019, because during this period the active fleet w as retrofitted.

Lastly, these labor learning efficiencies were subt racted from the labor costs we estimated in ADS-B Out Equipage Cost Estimate section.

Table 12 details the total ADS-B Out costs of this final rule, including learning efficiencies for labor, for large category turbojet aircraft in the 2009-2035 analysis interval. Learning curve efficiencies lowers the s even percent present value base-case estimate by approximately $100 million. When we qu eried industry for ADS-B costs Efficiencies for 30 Hours

0 5 10 15 20 25 30 35

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23

Sequential YearsHours33

associated with this final rule, the ADS-B out hard ware costs resulted in a wide range

with installation labor costs constant across all t he cost ranges below.

Table 12

Table 13 details the total ADS-B Out costs of this final rule, including learning efficiencies for labor, for regional turboprop airc raft in the 2009-2035 analysis interval.

Table 13

Table 14 details the total ADS-B Out costs of this final rule, including learning efficiencies for labor, for GA aircraft in the 2009 -2035 analysis interval.

Table 14

4.2.3.8 ADS-B Out Maintenance Costs

In this section we discuss our assumptions and cost estimates for the maintenance and replacement intervals for the ADS-B Out equipment r equired by this final rule. As we received no comments on our modeling approach, the final rule is using the same approach to estimate maintenance and replacement co sts as the NPRM. For the maintenance interval we use Mean Time To Repair (MT TR). For the replacement interval we use Mean Time Between Failure (MTBF).34

Industry provided us with MTTR and MTBF times, in h ours, for most large category turboprop and regional turboprop aircraft types. F or other aircraft types we assumed MTTR and MTBF will be the same as an equivalent air craft group and class. We used the individual original purchase prices provided by industry for cost of replacement avionics due to failure. For MTTR, we estimated th e repair costs at three percent of the purchase price. We also assumed these replacement and repairs will occur at the aircraft

scheduled maintenance checks and therefore will not generate aircraft downtime costs.

We assumed minimal incremental MTTR and MTBF costs for neo-classic and modern turbojet aircraft that could be made capable of ADS -B Out operation by adding data link capabilities, interfacing to existing Global Naviga tion Satellite System (GNSS) equipment, or that may need additional programming updates that could be upgraded at nearly no cost. These neo-classic and modern turbo jet airplanes currently have transponders and position sources, so there is near ly no future incremental replacement or

maintenance costs with this final rule.

We obtained estimates for the annual average hours flown by aircraft group from BACK

Aviation Solutions. Table 15 shows the annual aver age hours by aircraft group estimates

we will use to estimate when MTBF and MTTR will occ ur.

Table 15

We then estimated the replacement and maintenance i nterval, in years, for ADS-B Out equipment based on the average annual number of hou rs that aircraft operate. Table 16 shows the intervals, in years, for replacement and maintenance of ADS-B Out equipment.

AIRCRAFT EQUIPMENT

BODY CLASSIFICATION AVERAGE
Narrow Body J2 2,857 Narrow Body J3 1,677 Narrow Body J4 1,500 Regional Jets J2 2,003 Widebody J2 3,101 Widebody J3 2,529 Widebody J4 3,307 Turboprops TP, TP4 1,305 AVERAGE ANNUAL NUMBER OF HOURS FLOWN35 Table 16

Tables 17 and 18 shows the estimated maintenance an d replacement costs for ADS-B Out equipage in turbojet and turboprop aircraft during the 2009-2035 analysis interval.

Table 17

Table 18

The manufacturers and vendors did not provide us wi th MTBF or MTTR details for GA aircraft. However, based on Table 1.7 of the 2006 FAA General Aviation and Air Taxi Survey, the following annual average hours flown by aircraft group is calculated as:

Table 19

The reason we assumed GA aircraft will not incur ma intenance or repair cost is these

aircraft have low utilization rates relative to com mercial airplanes. Industry provided MultiMode Receiver Narrow J2 NarrowJ3 Narrow J4 Regional WideJ2 WideJ3 WideJ4 TP
Analog MTBF 7 12 13 10 6 8 6 15
Digital MTBF 9 15 17 12 8 10 8 19
Analog MTTR 3 6 7 5 3 4 3 8 Digital MTTR 7 12 13 10 6 8 6 15 Replacement and Maintenance Intervals In Years36

MTBF and MTTR hours for Large Category and Regional Turbojet and Regional Turboprop aircraft in order to estimate ADS-B Out i ntervals. We assumed the Large Category and Regional Turbojet and Regional Turbopr op aircraft MTBF and MTTR data will apply to the GA aircraft. The hourly MTBF est imates ranged from 20,000 to 45,000 hours depending on aircraft group. Because GA airc raft operate fewer hours than transport category aircraft, even at the bottom end of the range, the minimum replacement of an ADS-B Out unit on a GA aircraft w ill occur well beyond the analysis interval. Similarly, MTTR ranges fell between 10,0 00 to 15,000 hours, which again will occur outside of the analysis interval for a GA air craft. Thus, for the GA aircraft analyzed within the analysis interval, the MTBF and MTTR costs will be minimal.

In the next section, these additional ADS-B Out equ ipage maintenance and replacement

costs will be summed with the costs of additional f uel burn, purchasing and installing ADS-B Out, and upgrading avionic systems.

4.2.3.9 ADS-B Out Aircraft Equipage Cost Summary

The following tables summarize the range estimate o f constant dollars, three and seven percent present value costs to industry over the 20 09–2035 analysis interval. The low cost estimates represent the minimal compliance cos t outcome or a programming compliance change. The high cost estimates means a transponder or position source replacement or an operator’s decision to install av ionics that take advantage of future GNSS upgrades. The base case estimate represents a fleet where about half the airplanes are easily upgraded for future GNSS products and th e other half meet the minimum requirements of the final rule.

These cost estimates include ADS-B Out equipage, in stallation, maintenance, additional fuel burn costs and learning curve savings. Based on our MTTR and MTBF assumptions stated earlier, maintenance and replacement costs f or ADS-B Out for GA aircraft equals zero because the maintenance and replacement times will occur beyond 2035. The dollar value ranges consist of a wide variety of avionics within each aircraft group. The aircraft architecture within each equipment group can vary, causing different carriage, labor and wiring requirements for the installation of ADS-B O ut equipment. Volume discounting versus single line purchasing also affects the doll ar value ranges. We believe the basecase estimate is the most representative outcome. Table 20 shows the maintenance costs are included only in the base-case for the total co st calculation.37 Table 20

4.2.4 Cost to FAA to Provide Surveillance Under the ADS-B Out Scenario

ADS-B Out implementation requires integration of fo ur major components: ground infrastructure (ground based transceivers), automat ion, data 45 and avionics. 46

The FAA has entered into a vendor contract with IT T to provide ADS-B surveillance uplink and downlink services, TIS-B and FIS-B servi ces. The vendor will install and maintain the ground equipment necessary to provide ADS-B uplink and downlink

services to air traffic control. The costs for ADS -B Out presented in this report are an estimate of what the contractor will charge the FAA to provide these services and also include the costs of automation interfaces and prog ram office costs.

The costs of the ADS-B Out scenario also include ra dar costs, which include the cost to sustain existing radar until ADS-B Out is operation al (sustain costs), the cost to operate backup radar (backup costs), and the cost to decomm ission some radar as ADS-B

45 Integration of data is part of the ADS-B In ground costs.

46 Exhibit 300 Attachment 2 Business Case Analysis Re port for Future Surveillance JRC Phase 2a, pg. 12.38

becomes operational (decommissioning costs). Under the radar baseline scenario, the FAA will incur costs of $2.9 billion over 27 years ($1.2 billion when discounted by 7%)

as detailed in Table 2. Under the ADS-B Out scenar io, the FAA will incur total legacy surveillance costs of $1.9 billion ($975 million wh en discounted by 7%). In other words, the FAA will spend $1 billion ($271 million when di scounted by 7%) less on radar under the ADS-B Out scenario, because it will cut back on the number of radar. However, the FAA will incur $1.8 billion for the ADS-B Out surve illance services ($1.1 billion when discounted by 7%). Therefore, while the agency may be saving money on radar, it will be spending more on ADS-B services, so there will b e no net cost savings to the FAA from the ADS-B Out program. Total costs to the FAA of the ADS-B Out scenario are higher than total costs of the radar baseline scena rio.

The cost of the ground segment under the ADS-B Out scenario (not including Juneau, but including legacy surveillance costs) is estimated t o be $3.7 billion ($2.0 billion) over 29 years as presented in Table 21. This includes tota l ADS-B Out ground costs of $1.8 billion ($1.1 billion when discounted by 7%), and t otal legacy surveillance costs of $1.9 billion ($974 million when discounted by 7%) 47

.

Table 21

ADS-B Out Scenario Total Ground Costs: The Rule (not including Low Altitude Operations in the Gulf of Mexico, Capstone or Juneau) (2009K $)

47 The FAA developed these estimates internally.39

The costs of this rule will be borne by both indust ry and the government, and benefits will accrue to industry and to the flying public, a s discussed in the benefits section. Industry will incur costs ranging from $2.4 billion ($1.3 billion when discounted by 7%) to $6.1 billion ($3.3 billion when discounted by 7% ). Estimated benefits accruing to industry and the flying public range from $6.8 bill ion ($2.1 billion when discounted by 7%) to $8.8 billion ($2.8 billion when discounted b y 7%).

4.2.5 Benefits of ADS-B Out

ADS-B Out will enable improved surveillance service s across the en route, terminal, and surface environments by providing a robust, highly accurate, timely four-dimensional surveillance data link, based on the downlink of th e aircraft’s Global Positioning System (GPS) parameters. ADS-B Out is designed to improve the capacity and efficiency of the NAS, maintain safety, and provide a flexible, expan dable platform to accommodate future air traffic growth.

The FAA is not engaging in this rulemaking simply t o meet the level of surveillance that exists in the current infrastructure, or to establi sh a new surveillance system that would only enable separation performance equivalent to th at realized today. ADS-B Out performance is intended to go beyond today’s standa rds for accuracy and provide a platform for the next generation air transportation system.

The following quantified benefit estimates apply to both domestic operators and foreign operators as they operate in U.S. controlled airspa ce. However, we did not break out benefits between domestic and foreign operators. E arlier we provided a separate cost estimate for foreign firms, which we did not includ e in the costs of the rule, but we do not provide a separate benefit estimate corresponding t o those costs. Benefits are slightly overestimated because they include benefits to fore ign operators but do not include the costs to foreign operators.

Quantifiable benefit areas and associated estimated benefits are presented in Table 22

below. Derivations of these estimates are describe d in the following sections.

Table 22 Quantified ADS-B Out Benefits

2009$ M40

4.2.5.1 High Altitude Operations Over the Gulf of M exico

Assumptions

• IOC for communications and weather over the Gulf of Mexico 9/2009,

• IOC for surveillance 12/09,

• Capacity benefits phase in beginning in 2012 and by 2019 100% of the active fleet is equipped, and

• Delays are limited to, or capped at 20 minutes. 48

Delay Savings and Additional Flights Due to Increas ed Capacity over the Gulf of Mexico (Benefits of Reduced Delay and Value of Addi tional Flights Accommodated

We estimate that the benefit of increased capacity for high altitude operations that will be

achieved with ADS-B Out over the Gulf of Mexico mea sured in reduced delays is $1.7 billion ($463 million at 7% present value). We als o estimate that ADS-B Out will accommodate an additional 290,550 flights over the Gulf of Mexico during the period from 2017 through 2035. We estimate the benefit of these additional flights is $572 million ($118 million at 7% present value). Append ix B has details on the methods we

used to estimate these benefits.

ADS-B Out can potentially decrease delays over the Gulf of Mexico by allowing air traffic controllers to separate traffic to radar st andards rather than oceanic standards. While the rule does not mandate ADS-B Out performan ce requirements over the Gulf of Mexico beyond 12 miles from the U.S. shore, all hig h altitude aircraft that fly into and

out of the U.S. over the Gulf of Mexico will have t o be equipped to the standards of the rule because these aircraft will be traversing airs pace that requires ADS-B performance. The FAA will provide ADS-B surveillance capability under the vendor service contract.

Currently, controllers need to build a margin of sa fety into airspace where there is no

radar. In non-radar areas like the Gulf of Mexico c ontrollers separate aircraft by 10 to 15 minutes, which is equivalent to 80 to 120 miles lat eral separation. ADS-B Out

48 “approximately 20 minutes represents the highest l evel of average delay realized in actual practice e ven at highly congested airports”, FAA Airport Benefit Cost Analysis Guidance, page 16, FAA Airport Benefi t Cost Analysis http://www.faa.gov/regulations_polici es/policy_guidance/benefit_cost/media/faabca.pdf41

surveillance in these areas will allow closer separ ation of aircraft because air traffic

controllers will be able to see aircraft and achiev e radar-like separation. This will lead to fewer delays and higher levels of traffic than woul d be the case without ADS-B Out.

Optimal Routing and More Direct Routing Over the Gu lf of Mexico – Benefits of Decreased Flying Distance

Provision of ATC surveillance above FL240 for non-r adar regions over the Gulf of Mexico will allow for optimal and more direct routi ng of flights. We estimate that $384 million ($144 million at 7% present value) might be achieved in time saved due to optimal routing and more direct routing over the Gu lf. Details of how these benefits were estimated are shown in Appendix B.

Due to lack of surveillance and limited communicati on at high altitudes, non-radar separation procedures restrict aircraft flying high altitude operations over the Gulf to a limited number of routes or to a path avoiding the non-radar region completely. The introduction of radar-like separation attained by p roviding surveillance and improved

communications services in the Gulf of Mexico will permit the creation of additional routes or the granting of more direct requests. Th is will allow for more efficient routes, which will result in decreased flying distance. De creased flying distance can be translated into time saved, which can be valued in terms of aircraft direct operating costs and passenger value of time.

4.2.5.2 Improved En Route Conflict Probe Performanc e

Conflict Probe Benefits

The Conflict Probe is a tool designed to assist the air traffic controllers in their key role of ensuring the safe and expeditious movement of ai rcraft. It does this by constructing aircraft trajectories – the predicted flight path o f aircraft in 3-D position and time -- based on detailed flight models, the aircraft’s flight pl an, and surveillance data. These trajectories are then continuously “probed” for pos sible separation violations between aircraft – i.e., “conflicts” -- and the controller is notified accordingly. The warning time for these conflicts is limited only by the trajecto ry accuracy, and thus strategic problem notification is supported for enhanced safety and e fficiency. Controller action and pilot requests may also be checked before they are implem ented with “trial” trajectories, further improving safety and facilitating the grant ing of these requests.

Assumptions

• The mean distance of prevented maneuvers = 1.04 NM.

• An average speed of 356 NM per hour per prevented m aneuver will save .0029 th
of an hour (1.04 NM/356 nmph). 49

49 FAA (2003), “Controller-Pilot Data Link Communicat ions (CPDLC Build 1A) Benefits Analysis.”42

• Given a value of time per IFR hour of $4,431 50 the average prevented maneuver will save $12.94($4,431 x .0029).

• Estimate 65% of the remaining conflicts are vector maneuvers. 51

• The mean path length of vector maneuvers not elimin ated with ADS-B is 4.01

NM.

• With ADS-B the efficiency of the remaining vector m aneuvers will increase by

1/8 of the maneuver distance.

• Using an average speed of 356 NM per hour each vect or maneuver made more

efficient will save .0014 th of an hour (4.01 NM /8 =.50 NM; convert to hours . 50 NM/356 = .0014).

• Given a value of time per IFR hour of $4,431 each m ore efficient maneuver ($4,431 x .0014) will save $6.24.

• Conflict probe benefits begin in 2017.

• Controllers act on 10% 52 to 63.35% 53 of conflict alerts, with 10% giving a lower bound estimate and 63.35% giving an upper bound est imate.

• Slight discrepancies are due to round off error.

Controllers act on the knowledge that an aircraft o n their display may have travelled for up to 12 seconds with no display update. To compen sate for this less than precise radar surveillance information, the actual spacing betwee n aircraft is usually larger than the minimum separation required. The minimum allowed e n route separation is 5 nautical miles, but high performance aircraft can travel up to 1.5 nautical miles laterally during the time between updates on the radar display. 54

With the greater precision of ADS-B, it is possible that controllers will put less of a buffer between aircraft in flight. With less of a buffer, there may be less maneuvering of aircraft and consequently less fuel consumed and le ss delays (less time spent in aircraft maneuvers). Because of the uncertainty of whether the knowledge that display data will be more precise with ADS-B will result in air traff ic controllers actually reducing the buffer between aircraft, Mitre estimated the benefi ts that could result if their conflict probe tool alerted less frequently due to more prec ise ADS-B data. The Mitre study, 55
provides the basis for the methodology and some dat a for the benefits estimated here, but some of our assumptions differ from those in the st udy. Because the study was performed before the latest FAA forecast was releas ed, the Mitre study does not use this latest forecast, while the estimates provided here do.

50 Includes aircraft direct operating cost and passe nger value of time and is based on the 2009 TAF and

ATO-F FY09 economic values.

51 “ADS-B Benefits Enabled from Improved En Route Conf lict Probe Performance”, The Mitre Corporation, August 27, 2007.

52 Human Factors Research and Engineering Group AJP-6 1, FAA

53 Subject matter experts in Air Traffic Organization – Finance, now called IP&A, Operations Research

group
54 Ibid.

55 “ADS-B Benefits Enabled from Improved En Route Con flict Probe Performance”43

According to Mitre’s analysis, the excess separatio n can be reduced by at least .5 NM for each aircraft due to ADS-B, removing a total of 1 N M of excess separation due to the slower update rate of radar. 56 The total separation reduction from 8 to 7 NM all owed by ADS-B could support increased flight efficiency in two ways. First, some maneuvers are eliminated completely because of the reduction in t he number of alerts. Without ADS-B, the conflict probe would issue an alert if two airc raft were going to lose 8 NM lateral separation. Two aircraft equipped with ADS-B would only set off a conflict probe alert if they were going to lose 7 NM lateral separation. F ewer maneuvers translate into a time savings, which translate into a cost savings. Acco rding to data from the FAA’s Air Traffic Organization – Finance 57 (ATO-F) there would have been an added path distan ce of 1.04 NM per avoided maneuver, which translates i nto a time savings of .0029 hours.

Second, the lateral (vector maneuvers) that remain are expected to be more efficient due to the smaller separation distance that must be obt ained as illustrated in the Mitre analysis. ATO-F estimated the mean path length of vector maneuvers not eliminated

with ADS-B is 4.01 NM. These maneuvers could be ma de one eighth more efficient 58
eliminating .50 NM which translates to a time savin gs of .0014 hours.

To estimate the benefit of prevented maneuvers, Mit re estimated a conflict probe alert rate for both 8 NM and 7 NM separation by applying a URET-like conflict probe to recorded Base Year (2006) CONUS-wide data 59 with 8 NM separation to represent radar and 7 NM separation to represent ADS-B bounds. The analysis used a 10 minute lookahead time and each alert occurred in en route airs pace and would have been notified to an en route controller. Five days, each day being near the 90% busiest day in the NAS, were analyzed.

The measured alert counts at each separation value for each of the five days are presented in the table below. At an 8 NM separation, the ave rage number of conflict probe alerts is 53,122 and at a 7 NM separation the average number of conflict probe alerts is 45,155.

Table 23

Measured Alert Counts

56 Mitre estimated excess separation due to radar sur veillance error. To estimate excess separation due to radar surveillance error they used “comparative stu dies of radar and Global Positioning System (GPS) d ata as recorded for actual flights (e.g. Paglione and R yan, 2005) and other documented parameters such as wind prediction error, Flight Technical Error (FTE) , and speed estimation error.

57 The name of this FAA office has been changed to IP &A, Operations Research group, since they supplied

the data.

58 Mitre analysis, August 27, 2009, page 28.

59 This is recorded CONUS-wide en route track and flig ht plans as generated by the Enhanced Traffic Management System (ETMS).44

To obtain alert rates, IFR handles 60 in the continental United States, for each of the five days were obtained from ATADS. 61, 62 Pairwise combination handles per day were calculated by subtracting the number of handles fro m the square of handles and dividing by two. This represents all possible combinations of handles over the continental U.S. for that day and is used as the denominator in the calculations of the alert rates.

Table 24

IFR handles over the continental U.S.

Measured alert counts are taken as a percent of the pair-wise handle combinations per day for each of the two separation values (8 NM and 7 N M). This gives the percent of handle combinations that result in a conflict probe alert for each separation value according to the Mitre analysis; 5.54E-06 for 8 NM and 4.71E-06 for 7 NM separation.

Table 25

Alert Rate Per Pair-wise Handle for 8 NM and 7 NM S eparation

60 IFR Aircraft Handled. The number of ARTCC enroute I FR departures multiplied by two, plus the number

of en route IFR overs. This formula assumes that th e number of departures (acceptances, extensions, an d organizations of IFR flight plans) is equal to the number of arrivals (IFR flight plans closed).

61 http://aspm.faa.gov . # of handles is also available through Opsnet.

62 Excludes Anchorage and Guam.45

To forecast future conflicts these alert rates are applied to the forecast of daily pair-wise handle combinations over the continental U.S., whic h is computed from the number of IFR handles from the 2009 FAA Aerospace Forecast. 63 The table below illustrates how we estimated the number of prevented conflicts due to predicted fewer alerts with 7 NM separation rather than 8NM separation. We assume t hat the conflict probe increased accuracy benefit begins in 2017 64 and continues through the lifecycle.

For example in 2017, we project 129,100 IFR handles per day over the continental U.S. or 8.33 B pair-wise combination handles per day. T o determine the number of URET conflict probe alerts expected under the baseline ( 8NM separation), we multiply pair-wise combination handles by the radar alert rate of 5.54 E-06 to derive daily baseline conflicts of 46,192. This would represent the number of time s per day the conflict probe would alert without ADS-B (8 NM separation). Similarly t o obtain the number of URET conflict probe alerts expected with ADS-B we multip ly pairwise combination handles by the 7NM separation alert rate of 4.71E-06 to derive 39,264 or the number of times per day the URET conflict probe would alert with ADS-B surveillance. The potential prevented maneuvers are 6,928 daily. However, expe rience indicates that controllers do not always act on the URET conflict probe alerts. Studies indicate that the number of times a controller acts on a conflict probe alert c an be as low as 2% of conflict probe alerts to as high as 100%. The Mitre conflict prob e analysis assumed that controllers would act on 100% of the conflict probe alerts. In the regulatory impact analysis of the NPRM, we assumed that controllers would have acted on 63.35% of these conflicts. In this final regulatory impact analysis, to be conser vative, we add a lower bound estimate of conflict probe benefits that assumes that contro llers only act on 10% 65 of conflict probe alerts. Table 26 uses 63.35% as the percent of conflict probe alerts that controllers

63 Table 33, IFR Handled at FAA Air Route Traffic Con trol Centers, 2009 FAA Aerospace Forecast, less handles over Guam and Anchorage.

64 The conflict probe is planned to be available to t he R-side controller by 2016.

65 Based on discussions with personnel in FAA’s Human Factors Research and Engineering Group AJP61. The lower bound number is also supported by st udies including: Adaptation and adoption of technologies: Examination of the User Request Evalu ation Tool (URET), Kevin Corker, Martin Howard, Martijn Mooij, San Jose Sate University, No vember 1, 2005, which indicated that about 2% of

alerts are acted on and Human Factors Analysis of Safety Alerts in Air Traf fic Control, Kenneth Allendoerfer, Human Factors Team – Atlantic City, A TO-P Ferne Friedman-Berg, Ph.D., Human Factors Team – Atlantic City, ATO-P Shantanu Pai, Engility Corporation November 2007 which concluded that

13%-19% of alerts are acted on.46

act on. The number of actual prevented conflicts i n the example is 4,389 in 2017 (6,928 times 63.35%). The dollar value of each prevented maneuver is $12.94 (see assumptions above for calculation) and the total dollar value o f prevented maneuvers per day is $56,805. 66

Table 26 Estimate of Prevented Conflicts and Savings for Pre vented Maneuvers

In addition to eliminating potential conflicts that occur between 7 NM and 8 NM, ADS-B could make some maneuvers of aircraft that trigger an alert within the 7 NM separation more efficient. In 2017, we estimate 39,264 confli ct probe alerts given a 7NM separation alert threshold (daily handle pairs of 8.33 billion times the 7 NM conflict probe alert rate 4.71E-06 = 39,264). If controllers acted on 63.35% of these conflict alerts, 24,874 potential conflicts would be maneuvered in 2017. S ixty-five percent of the remaining maneuvers (16,168) can be made more efficient becau se of ADS-B surveillance data. The dollar value of the increased efficiency is $6. 24 per maneuver as explained under the

66 Discrepancies due to round off error.47

assumptions above. Savings for the remaining vecto r maneuvers is $100,827 per day in

2017.48 Table 27 Estimates of Remaining Vector Maneuvers and Savings for Increased Efficiency of Some Remaining Maneuvers

Table 28 shows annual savings in 2009 dollars given that controllers act on the alerts 63.35% of the time, the high benefit estimate. For example for 2017, we add savings from prevented maneuvers ($56,805) plus savings for more efficient vector maneuvers ($100,827) for daily total savings ($157,631) and d erive an annual savings of $57.5 million. Since we estimate 78% equipage in 2017 we claim 78% of the $57.5 million savings in year 2017.

Table 28

Dollar Value of Conflict Probe Performance Benefits – High49

The analysis is repeated with a 10% rate of control lers acting on conflict probe alerts. The estimated dollar savings are presented below.

Table 29

Dollar Value of Conflict Probe Performance Benefits – Low

Estimated conflict probe benefits range from $267 m illion ($82 million when discounted by 7%) to $1.7 billion ($516 million when discounte d by 7%).

4.2.5.3 More Accurate Metering Because of Increased Accuracy

The improved accuracy and update rate of ADS-B posi tion and speed information (over the accuracy, update rate, and information supplied by radar) will impact the capabilities of controller automation. One aspect of current au tomation is a metering capability called the Traffic Management Advisor (TMA). TMA i s a decision support tool for en route controllers that optimizes arrival flows into busy airports. The controller display provides exact times for each aircraft to reach the arrival fix so that runway throughput is optimized. Because predictions of runway throughpu t and metering times are based on surveillance inputs, the increased accuracy and upd ate rate of ADS-B, over radar, should allow better predictions, leading to an incremental increase in runway throughput.

TMA was developed by NASA as part of the Center TRA CON Automation System (CTAS). Many NASA studies have examined the uncert ainty in initial position, aircraft speed, aircraft weight, and winds, and how these un certainties introduce errors into the

CTAS calculations of meter fix arrival times. The study, “CTAS Error Sensitivity, Fuel Efficiency, and Throughput Benefits” (NASA 1996), c ompared the meter fix uncertainty of the current system, TMA (with the addition of we ather information from the Integrated Terminal Weather System - ITWS) and a planned upgra de to TMA called the En route Descent Advisor (EDA). Table 30 presents a summary of the meter fix uncertainty information from the NASA paper. A further study c omparing EDA and TMA, “EDA July 2004 Simulation Overview,” (NASA 2004) present ed similar results.50 Table 30 Meter Fix Uncertainty from NASA Study

ADS-B surveillance information should further reduc e the uncertainty in initial position and speed allowing more accurate meter fix delivery . The “En route Descent Advisor Performance Analysis Final Report” (NASA, 2004) exa mined the CTAS input factors (e.g. position, speed, wind , weight, etc.) closely to determine the contribution of each to the meter fix uncertainty. They found that speed a nd initial position uncertainty account for approximately 40 percent of the remaining error . Table 31 repeats the information given in Table 30, but also applies the additional 40 percent reduction that would occur with no initial position and speed variance. Table 31 implies that if all position and speed error could be eliminated the remaining variance wo uld be 13 seconds. If only half the variance could be eliminated the remaining would be 17 seconds. It is assumed in this estimate that the increased accuracy and update rat e of ADS-B in the en route airspace, and the ability to downlink speed information direc tly into the automation (as opposed to the current method of estimating speed from multipl e radar hits over time) will eliminate half the remaining variance due to speed and positi on uncertainty seen in the current

system.

Table 31

Meter Fix Uncertainty with Increased Accuracy

Table 31 also lists the meter fix uncertainty as a percentage of the uncertainty in current operations. TMA reduces the meter fix uncertainty by 66 percent (44 percent of the original); the addition of EDA should bring the tot al uncertainty reduction to 83 percent (17 percent of original). If the speed and positio n accuracy from surveillance information were twice as accurate as current information, the final reduction would amount to an 86 percent decrease in meter fix uncertainty (14 perce nt of original).

To translate the analysis described above into an e conomic benefit, we first examined the benefit of different arrival variance changes on ai rport delay using an equilibrium51

queuing model. The inputs for the model include cu rrent Future Airport Capacity Task (FACT 2) airport capacities, current demand profile s at each airport, and future projected operations from the Terminal Area Forecast (TAF). The model allows changes in the arrival variance that should reflect the changes in uncertainty described in Tables 30 and 31. The benefits of TMA, TMA plus EDA, and TMA plu s EDA plus ADS-B increased accuracy were tabulated. The ratio of the incremen tal ADS-B increased accuracy benefits to the TMA benefits equaled approximately 0.05. This leads us to believe that the increased accuracy of ADS-B information should at least result in a 5 percent increase in benefits beyond current TMA projections. In rea lity this estimate is conservative, because it already assumes that the introduction of ADS-B information will be incremental to EDA, a program that is still in the planning stages but will most likely come to fruition before full ADS-B equipage.

The TMA Program Office completed a future benefits analysis in February 2007 that was submitted and approved within the FAA. The report presented yearly benefit results for 18 TMA airports through 2020. We leveraged these T MA results to estimate the

additional benefit due to ADS-B. We first scaled t he TMA results to reflect the current approved aircraft direct operating costs (ADOC) and value of passenger time (PVT) values. The ratio described in the previous paragra ph was then applied to the TMA

results in 2020 to estimate the additional benefits due to increased surveillance information. The benefits were assumed to begin by 2020 and continue through the SBS lifecycle. The 2020 benefit was extrapolated throu gh 2035 using a linear scaling based on the growth in yearly operations at each relevant airport from the TAF.

The estimated benefits are $1.4 billion ($400 milli on when discounted by 7%).

4.2.5.4 Increased Ability to Allow Optimized Profil e Descent Procedures

Optimized Profile Descents (OPDs) 67 are Area Navigation (RNAV) / Required Navigation Performance (RNP) terminal arrival proce dures specifically designed to keep an aircraft at idle or near idle power from the Top of Descent (TOD) where descent begins, during the entire arrival until the Final A pproach Fix (FAF). Thus, the aircraft can leave En Route airspace, enter Terminal airspace an d descend smoothly to landing at the airport runway. The OPD eliminates step-down altitu des normally used and the associated inefficient power adjustments, whereby t he aircraft must increase power at each step to level off. These procedures result in increased savings in fuel, and reduced noise and emissions. In addition, since little or n o air traffic control vectoring of the aircraft is required during the procedure, the radi o frequency is less congested.

OPDs are currently more feasible with RNAV 68 at low traffic densities and with similarly equipped aircraft. For multiple OPDs to occur, the aircraft must be sequenced and spaced accurately. Aircraft are normally sequenced to met ering fixes using speed control and

radar vectors. Radar is used to establish and moni tor the separation interval between

67 OPDs may also be referred to as continuous descent approaches or CDAs.

68 And in the future will be feasible with RNP procedu res.52

arriving aircraft. The fidelity of the radar infor mation directly impacts the air traffic controller's ability to maintain an appropriate int erval.

As the amount of traffic increases, it becomes prog ressively more difficult for controllers to allow OPDs because of interfering flight paths f rom other arriving and departing traffic in the terminal, especially when more than one runw ay is in use. OPDs are often not used at very high traffic density situations.

Another factor limiting the use of OPDs is related to the inefficiencies involved in metering to the fix. OPD uses merging and spacing to bring aircraft to the TOD. In the Merging and Spacing (M&S) application, precise spee d instructions are sent from the ground to en route aircraft to properly sequence ai rcraft approaching the terminal area.

The SBS program is developing both a ground and coc kpit tool that can be used to optimize aircraft spacing to enable OPDs during inc reased levels of approach and departure activity than is currently feasible. A p rototype tool is being developed for UPS to use in their Airline Operations Center. When th is tool is mature it will be incorporated into FAA traffic flow management automation to allo w FAA controllers to space aircraft from multiple carriers across multiple dependent me rge fixes into an airport using future

surveillance data.

The increased accuracy and fidelity of the ADS-B Ou t positioning solution, combined with the SBS merging and spacing tool provides a mo re sophisticated metering solution, allowing controllers to meter aircraft with varying performance characteristics to different merge points. Therefore, ADS-B has the p otential to increase OPD usage.

Assumptions for OPD benefit estimates:

• OPD can save on average 69 273 pounds of fuel per aircraft.

• Fuel cost per pound = $.291. Estimated fuel cost p er gallon is $1.95 70 (2009 $) which converts to $.291 given 6.7 pounds per gallon of fuel.

• Benefit can only be achieved during visual meteorol ogical conditions (VMC)

conditions because reduced weather in the extended terminal area can hinder

OPDs.

• NAS wide start year for OPD is 2014.

• OPDs can be accomplished without ADS-B Out at traff ic densities 71 up to 40%.

69 The average of 181 lbs and 364 lbs saved per figh t from “Continuous Descent FAA COE Noise Study Projects”, Captain Bob Hilb, UPS Airlines, May 25, 2005.

70 “Economic Information for Investment Analysis Data Package,” 4/24/2009, Operations Research, ATOFinance.

71 We define traffic density as arrivals over capacit y.53

• OPDs at traffic densities from 40% to 70% cannot be accomplished without ADSB Out and a spacing tool. 72

• 50% of the fuel savings are attributed to ADS-B Out with spacing tool. We assume the rest is due to RNAV procedures.

• Spacing tool will be available at the Top 100 Airpo rts.

• Only air carrier and commuter airlines will have su fficient economic incentive to apply OPDs on a day-to-day basis.

• Commuter operations comprise 66% of Air Taxi and Co mmuter operations.

The increased ability to allow OPD benefits were es timated by multiplying the average fuel savings per OPD arrival to the percent of flig hts that arrive at each of the top 100 airports during periods when demand is between 40 a nd 70 percent of VMC capacity. The benefit was only taken during VMC (good weather ) because reduced weather conditions in the extended terminal area may hinder OPDs. Estimates were developed separately for the 100 busiest airports. The benefi ts were assumed to begin NAS-wide in 2014 (and 2009 for UPS airports) and only apply to air carrier and commuter aircraft. Additionally, we further degraded the benefit by at tributing much of the savings for OPDs during the spacing tool regime to other necess ary elements like RNAV/RNP. To take account of the additional necessary elements, the SBS program office only claimed one half of the final spacing tool regime OPD benef it.

We took all Air Carrier Operations and Commuter Ope rations from the 2008 TAF at the top 100 airports forecasted to the year 2035. Sinc e operations include landings and takeoffs we divided operations by 2 to estimate lan dings which could benefit from OPD. Table 32 shows a sample of operations from the TAF. 73

Table 32 Air Carrier and Commuter Operations

72 With the exception of OPDs performed in Southern C alifornia.

73 This table includes more than just the top 100 airp orts, but we only include top 100 in our calculatio ns.54

Benefits start to accrue in 2014, the year we expec t the OPD procedures to be instituted NAS wide. Benefits increase with equipage which we assume is 27% in 2014 and grows to 100% by 2020. Below is the assumed ADS-B equipa ge rate.

Table 33 Percent of ADS-B Out Equipage

Table 34 shows the percent of time that various wea ther conditions occur at a sample set of airports. We only take benefit for OPDs perform ed during visual meteorological conditions and as indicated in the table below, ABE experienced VMC conditions 71.7%

of the time.

Table 34

Percent of Time Various Weather Conditions Occur

Source: National Climatic Data Center

30 year average

Table 35 shows the percentage of flights that arriv e during periods when the traffic density is between 40% and 70% of capacity.55 Table 35

Percent of the Time that Demand is Between 40% and 70% of Capacity

Source: ATO-Finance, Investment and Analysis Offic e

Calculation of benefits at ABQ in 2021 as an exampl e:

Air Carrier and Commuter Operations = 108,335 Estimated Landings = (108,335)/2 = 54,168

Percent of Air Carrier and Commuter Aircraft that a re ADS-B Out Equipped = 100% Number of A/C and Commuter A/C ADS-B Equipped = 54, 168 Percent of the time that ABQ has VMC conditions = 9 7.5% Number of flights during VMC conditions = 97.5% x 5 4,168 = 52,813 Percent of flights that arrive during periods where demand is between 40 and 70% (medium density) = 14% Number of flights arriving during medium density pe riods = 14% x 52,813 = 7,394 Estimated average fuel savings per airport = 272.7 pounds Estimated fuel savings at ABQ in 2021 due to ADS-B = 7,394 x 272.7 = 2,016,300 pounds Estimate average cost of fuel per pound = $.291 Estimated monetized value of fuel savings due to OP D = 2,016,300 x $.291 = $586,743 Percent attributed to ADS-B with spacing tool = 50% Monetized value of fuel savings due to ADS-B with s pacing tool in millions of $= ($586,743 x 50%)/1,000,000 = $.30 million.56 Table 36 Estimated Dollar Benefits due to OPD by Airport by Year 2009$ M

Table 37 Total Estimated Benefits of Optimal Profile Descent

4.2.5.5 Net Impact on Carbon Dioxide Emissions

ADS-B will result in both decreases and increases i n carbon dioxide (CO 2 ) emissions,

with a net reduction in CO 2 emissions, as explained below.57

Reduced CO 2 Emissions

Assumptions and Conversion Factors

• Price per gallon of jet fuel = $1.95,

• Pounds of fuel per gallon = 6.7,

• Pounds per metric ton = 2204.6,

• 1 metric ton of fuel = 3.156 MT of CO 2 ,

• 2010 Global Social Cost of Carbon (SCC) per metric ton of CO 2 ranges from a low value of $4.88 to a high value of $36.46, expre ssed in 2009 dollars,

• SCC grows at the annual rates listed below

Average Annual Growth Rate(%) 5%

Average 2.5 %

Average

2010-2020 3.6% 1.7%

2020-2030 3.7% 1.8%

2030-2040 2.7% 1.6%

2040-2050 2.1% 1.1%

Some portion of the ADS-B Out benefits is reduced f uel consumption. Reduced cost of fuel benefits aircraft operators (and possibly cons umers if reduced costs can be passed on). However, there is an additional environmental benefit to reducing fuel consumption and that is the benefit we present here. Fuel burn creates CO 2 emissions which remain in the atmosphere for long periods, becoming well-mixe d throughout the earth’s atmosphere, with long-term effects on the global cl imate.

To estimate the benefits of reduced CO 2 emissions we have to monetize the impact that changes in greenhouse gas (GHG) emissions will like ly have on the environment. A first step in monetizing these benefits is to determine t he incremental damage associated with changes in GHG emissions, in particular CO 2 emissions. These incremental or marginal damages are frequently described in the published l iterature 74 as the Social Cost of Carbon (SCC) and are measured as the net present va lue of climate change impacts over hundreds of years from an additional metric ton of CO 2 emitted to the atmosphere at a particular point in time. Based on an interagency report titled “Highlights of Appendix15A: Social Cost of Carbon for Regulatory I mpact Analysis under Executive Order 12866”, we use a set of range values for the social cost of carbon (expressed in terms of $/MT of CO 2 ) to monetize the reductions in CO 2 emissions. For 2010, the global social cost of carbon per metric ton of CO 2 ranged from $4.88 to $36.46, expressed in 2009 dollars.

74 See Tol, Richard, 2005. "The Marginal Damage Cost of Carbon Dioxide Emissio ns: an Assessment of

the Uncertainties." Energy Policy 33: 2064-2074.58

It is widely believed that because GHGs tend to acc umulate in the atmosphere and have very long residence time, future emissions are like ly to produce larger incremental damages as physical and economic systems become mor e stressed. The IPCC Fourth Assessment Report estimated that climate-related ec onomic damages resulting from an additional ton of carbon emissions are likely to gr ow at a rate between 2 and 4 percent annually. Consistent with the interagency guidanc e noted above, we allow the real global SCC to increase over time. By 2035, the ran ge values reported above increased to $11.63 and $56.30, per metric ton of CO 2.

With ADS-B surveillance, we expect that less fuel w ill be burned because of fewer and more efficient en-route maneuvers, more efficient t raffic management, increased use of optimal profile descent, more optimal and direct ro uting over the Gulf of Mexico and fewer delays on the ground for aircraft waiting for take-off over the Gulf of Mexico. In the benefit calculations (except the optimal profil e descent benefit 75 ) we estimated the

number of hours saved due to ADS-B either in the ai r or on the ground and multiplied these hours by the appropriate aircraft direct oper ating cost (ADOC). The ADOC includes a fuel component. To estimate the fuel sa vings, the benefits were first reestimated using only the aircraft direct operating cost of fuel. The estimated dollars saved on fuel are presented in the table below.

75 The optimal profile descent benefit consists entir ely of fuel savings.59 Table 38

Dollar Value of Fuel Savings

To estimate fuel savings we divided the dollar valu e of fuel savings by $1.95, 76 to derive gallons of fuel saved. Gallons of fuel were conver ted to pounds of fuel saved (multiply by 6.7) and then to metric tons (divide by 2204.6). Metric tons of fuel consumed were

converted to metric tons of CO 2 emissions (multiply by 3.156 77 ). Table 39 shows these

results.

76 FAA Forecast 2009-2025, Table 18, System Current $ converted to 2009 dollars and averaged for the years 2009-2025.

77 IPCC, Aviation and the Global Atmosphere, Cambridg e University Press, 1999, pg. 33.60 Table 39

Total Metric Tons of CO 2 Abated

Increased CO 2 Emissions

ADS-B Out will also result in some increased CO 2 emissions into the atmosphere;

however the overall net result is a reduction in CO 2 emissions. We estimate the

additional CO 2 emissions that will result from additional flights accommodated over the Gulf of Mexico, and from the additional fuel burn t hat will result from weight added to

aircraft because of the avionics.61

Additional Flights Over the Gulf of Mexico – CO 2 Emissions

Assumptions and Conversion Factors

• Average duration of additional flight over the Gulf – 4.33 hours, and

• ADOC per hour for fuel = $1,861.5. 78

Table 40

Total Additional Metric Tons of Fuel Consumed and o f CO 2 Produced Due to

Additional Flights Over the Gulf of Mexico

The FAA used the ETMS flight plan data and extracte d origin and destination airports for all flights that included sectors ZHU72 or ZHU79 to create a unique list of origin destination pairs.

The flight time for flights between these city pair s was derived from the ETMS database and scheduled flight data (commercial) from OAG/Inn ovata. The average duration of

78 Economic Information for Investment Analysis, Prep ared for Operations Research/ATO-F, April 24, 2009, 50% of block hour variable cost for air carri er – TAF ($3,724) is attributed to fuel.62

these flights was 4.33 hours. 79 Each additional flight was multiplied by 4.33 to obtain additional flight hours. These additional flight h ours were multiplied by the fuel component of the aircraft direct operating cost per block hour ($1,861.5) to derive

additional fuel costs. Additional fuel costs were divided by an average price per gallon of fuel ($1.95) to determine additional gallons of fue l consumed. Gallons of fuel consumed were converted to pounds of fuel consumed (multiply by 6.7) which were converted to metric tons (divide by 2204.6). Metric tons of fue l consumed were converted to metric

tons of CO 2 by multiplying by 3.156.

Additional Weight of Avionics

ADS-B avionics can add from 3 to 12 pounds of weigh t to an aircraft which results in added fuel burn. We calculate the range of extra C O 2 emissions produced by the additional fuel burn. Total additional pounds of j et and GA fuel that would be consumed if ADS-B avionics added 3 pounds of weight and if A DS-B avionics added 12 pounds of weight to each aircraft are indicated in the table below. We convert pounds to metric tons (divide by 2204.6) and metric tons to CO 2 (multiply by 3.156). The additional

metric tons of CO 2 produced would be 22,823 if ADS-B avionics added 3 pounds of weight and 56,613 if the avionics added 12 pounds o f weight to each aircraft as displayed in the table below. Table 41 is an example that sh ows the high estimate of additional

metric tons of fuel consumed.

Table 41

Additional Pounds of Fuel Consumed Due to Added Wei ght of Transponders

79 MCR/SETA.63

We added additional CO 2 produced by the additional flights over the Gulf of Mexico (11,519 K MT) to the additional CO 2 consumed by the added weight of the avionics (22.8 K MT for the low end of the range and 56.6 K MT for the high end of the range). The

additional CO 2 produced ranges from 11,542 K MT to 11, 576 K MT.

To produce a range of net CO 2 savings we subtract the high net CO 2 produced (11,576 K)

from the low net CO 2 saved (16,409) for the low estimate (4,833 K MT) an d subtract the

low net CO 2 produced (11,542K) from the high net CO 2 (18,610) saved for the high estimate (7,068 K MT) of net CO 2 savings.

Table 42

Total Metric Tons of CO 2 Saved

In Table 43, we convert the net reduction in CO 2 emissions into a dollar value by multiplying the net reduction by the social cost of carbon. We calculate results using a low and high social cost of carbon. Table 43 shows the result of using the low global

SCC with the estimated low net reduction in CO 2 emissions and the high global SCC with the estimated high net reduction in CO 2 emissions to illustrate the low and high64

bounds. The benefit from a net reduction in CO 2 emissions ranges from $27 million to a high of $300 million, undiscounted.

Table 43 Benefit of Net Reduction in CO 2

Emissions

4.3 Multilateration Alternative Scenario

4.3.1 Definition

Multilateration was one of the original technologie s the FAA considered when exploring alternative surveillance sources in the early 1990s . The agency established several testbeds for multilateration. The incremental developm ent of multilateration eventually led to the certification and deployment of ASDE-X and 3 X systems for surface surveillance.

Multilateration functions by triangulating aircraft position based on time difference of arrival of signals to multiple ground stations. Fo r multilateration surveillance, an aircraft must have at least 4 ground stations receiving its transponder information. 80 It can

80 Exhibit 300 Attachment 2 Business Case Analysis Re port for Future Surveillance, JRC Phase 2a, pg. 6.65

function with both existing and future transponders such as Modes A/C, Mode S short and future extended squitter transponders. Multila teration is currently in use as a surface surveillance tool through the ASDE-X program, and h as been tested for use in supporting the Terminal and En Route airspace domains. 81

4.3.2 Cost to Industry

There are no costs to industry related to surveilla nce with multilateration because the current fleet is equipped with transponders, which will function with multilateration

surveillance.

General aviation operators who aren’t equipped for weather and traffic services in the cockpit could obtain these capabilities with multil ateration by installing equipment on the aircraft and by subscribing to weather services. A ccordingly, we did not include these costs in this analysis for either the multilaterati on scenario or the radar baseline scenario. We assume those operators would not willingly incur the costs of weather and traffic because for the most part they have not done so to date.

4.3.3 Cost to FAA

We estimate it will cost FAA $3.0 billion ($1.7 bil lion when discounted by 7%) to provide surveillance using multilateration over the 29 years. This will include facilities and equipment and operating and maintenance costs f or multilateration ground facilities to provide core surveillance and the cost to sustai n radar facilities until multilateration is operational. We do not include the cost of providi ng broadcast services with

multilateration.

Included in the estimates of multilateration survei llance costs are costs of facilities and equipment, operations and maintenance costs, radar sustain costs and radar decommissioning costs. Multilateration does not re quire a separate backup system due to

its built-in redundancies. Multilateration surveil lance costs are presented in Table 44

below.

81 Exhibit 300 Attachment 2 Business Case Analysis Re port for Future Surveillance, JRC Phase 2a, pg. 1066 Table 44 Cost to Provide Core Surveillance Using Multilatera tion 2009$ K

4.3.4 Benefits of Multilateration Surveillance

Our research did not identify any other feasible be nefits of multilateration compared to radar. Multilateration may have the potential to i mprove accuracy but it would not be practical to do so, since it could require ground s tations in locations where it may not be feasible. It is possible that in some locations mu ltilateration could allow for tighter separation, but it might require too many multilate ration ground stations for multilateration to be cost effective for reducing s eparation.

While multilateration could provide radar-like sepa ration in some parts of the Gulf of Mexico, it is not feasible to provide radar like se rvices throughout the entire area of the

Gulf. This is due to limitations in the number and location of platforms, which would house the ground stations. We assume that multilat eration surveillance would provide the same functionality as radar, and we have estima ted no benefits from multilateration surveillance beyond those achieved by the current r adar system.67

5.0 Summary Comparison of Costs and Benefits

The costs of the ADS-B Out, multilateration, and th e radar baseline scenarios are summarized in Table 45 below with present values di splayed in Tables 46 and 47. Estimated FAA surveillance costs are $3.7 billion ( $2.05 billion when discounted by 7%) and exceed the radar baseline by $810 million ($800 million when discounted by 7%).

Avionics costs in these tables are presented at the midpoint between the high and low estimates. In later tables, we will present the av ionics costs as a range. The midpoint of estimated user costs to equip is $4.37 billion ($2. 12 billion when discounted by 7%).

Table 45 Summary of Costs of Multilateration, Radar Baseline and ADS-B Out Scenarios 2009$ B68 Table 46 Summary of Costs of Multilateration, Radar Baseline and ADS-B Out Scenarios 2009$ B at 3% Present Value

Table 47 Summary of Costs of Multilateration, Radar Baseline and ADS-B Out Scenarios 2009$ B at 7% Present Value

Table 48 summarizes the costs and benefits and show s the difference between the ADS-B

Out scenario and the radar baseline scenario. Tabl es 49 and 50 present the same costs69

and benefits discounted by 3% and 7% respectively. Avionics costs range from a low of $2.5 billion ($1.4 million when discounted by 7%) t o a high of $6.2 billion ($3.3 billion when discounted by 7%) over the time horizon of the analysis. The total incremental cost of the ADS-B Out scenario (including government cos ts) ranges from $3.3 billion ($2.2 billion when discounted by 7%) to $7.0 billion ($4. 1 when discounted by 7%) more than

the radar baseline scenario.

We estimated that benefits range from $6.8 billion ($2.1 billion when discounted by 7%) to $8.5 billion ($2.7 billion when discounted by 7% ). These are incremental to the radar

baseline.

If benefits are high and costs are low (best case s cenario), we estimate $5.2 billion ($590 million when discounted by 7%) of net benefits. If benefits are low and costs are high, we estimate negative net benefits.

Table 48 Summary of Costs and Benefits

2009$ B

The bulk of the ATC efficiency benefits from ADS-B Out are expected to occur after the compliance date of the rule. However, the FAA’s dep loyment strategy for surveillance equipment has the potential to allow benefits to be realized earlier than this conservative estimate. For example, if FAA decided to roll out A DS-B surveillance coverage regionally, aircraft operating primarily in the cov ered region may choose to equip faster than the rule mandates. A higher density of equippe d aircraft in specific regions could permit increased use of procedures that yield benef its.70 Table 49 Summary of Costs and Benefits 2009$ B at a 3% Present Value

Table 50 Summary of Costs and Benefits 2009$ B at a 7% Present Value71

Even though the quantitative benefits of the ADS-B Out rule do not always exceed the costs, the FAA has made a reasoned determination th at the quantitative and the qualitative benefits exceed the costs. The bulk of the costs are incurred from the effective date of the rule (2010) to the compliance date (202 0), while most of the benefit from ATC efficiencies occur after the compliance date. The FAA is mandating ADS-B Out because we view ADS-B Out as a springboard to NextG en which could lead to further benefits in the future; some of the benefits have y et to be identified and some have not yet been quantified. Also, as explained in the mar ket failure section, there is a lack of incentive for operators to voluntarily equip with A DS-B Out. Once all the aircraft within an airspace are equipped with ADS-B Out, operators who also equip their aircraft with ADS-B In can begin to accrue benefits such as conti nuing visual approaches in marginal

conditions or reduced aircraft to aircraft conflict s. The FAA views ADS-B as a means to accommodate the expected increase in demand for sur veillance and separation services with less delay than would be possible with the cur rent radar system. As mentioned in the preamble, “to accommodate the projected level o f traffic without adding delay, more comprehensive surveillance in the NAS, including mo re radar sites in certain areas, would be necessary.” However, increasing the numbe r of radars in the NAS does not solve the inherent limitation of radar technology, and would not enable the FAA to eventually reduce current separation standards. Al so, radar does not provide the capability to provide services on the flight deck a s ADS-B does.

6.0 Additional Programmatic Benefits of ADS-B Out

In addition to the rule-oriented benefits of ADS-B discussed above, there are additional

benefits of ADS-B associated with the overall ADS-B program. These include increased ability to conduct operations at low altitudes over the Gulf of Mexico, enhanced search and rescue capability, and enhanced surveillance wh ere radar is currently weak. These

benefits are discussed below.

6.1 Increased Ability to Conduct Operations at Low Alti tudes over the Gulf of

Mexico

There is currently a signed Memorandum of Agreement (MOA) between the FAA, the Helicopter Association International (HAI), helicop ter operators, and oil and gas platform owners to improve low altitude service in the Gulf of Mexico. In this MOA, helicopter operators agree to equip with appropriate avionics and equipment to take advantage of FAA enhancements to communications, weather reporti ng, and surveillance capabilities. In this regulatory impact analysis we reason that, since helicopter operators in this region would equip with or without the rule, the associate d benefits and costs are attributable to the overall ADS-B program but not the rule itself.

6.2 Enhanced Search and Rescue Capability

One of the objectives of the ADS-B program is to ma ke techniques and services

associated with radar surveillance also available f or non-radar airspace through use of72

ADS-B, including enhanced search and rescue (SAR). While ADS-B should not be considered a replacement for Emergency Locator Tran smitters (ELTs), when an aircraft is reported missing, ADS-B can enhance SAR operatio ns by providing the last known surveillance position. The new 406MHz ELT has an a ctivation rate of 81-81 percent in

actual accidents but the ELTs in most General Aviat ion aircraft have an activation rate of 73 percent. The benefit of enhanced SAR operations is an increased likelihood of survival

for those involved in aviation accidents. When rada r coverage is not available and an aircraft is reported missing, SAR teams most often don’t know where to start looking. Also, even when an accident doesn’t directly result in fatalities, many people who survive the accident die of exposure because they cannot be found quickly. SAR activities, however, can be better focused if surveillance data is available for a flight presumed missing. By knowing the position of the aircraft p rior to the accident, the time duration of the search operation can be greatly reduced. By reducing the search times and locating the accident site quickly, the cost and resources t o conduct the operations are also greatly reduced. According to a published report from the A laska Wing Civil Air Patrol, in 2008, there were 211 SAR missions in Alaska, totaling 705 flight hours. Aircraft used vary from single-engine ($150-$500 per hour), multi-engi ne ($6,500 per hour), and helicopters ($2,500-3,200).

The anticipated SAR benefits from having ADS-B surv eillance coverage in non-radar inter-mountain areas like in the Rocky Mountains of Colorado can best be understood by looking at the benefit Alaska has realized as a res ult of their Capstone project and how their SAR operations have been affected. FAA Capsto ne avionics continuously broadcast the GPS-based position of the aircraft and other in formation through ground stations to Anchorage Center and other aircraft, and is availab le to operators for flight following. The potential for monitoring the location of FAA Ca pstone-equipped aircraft, and having the capability to note the loss of ADS-B data from an aircraft, could benefit the SAR process when an aircraft is overdue or reported mis sing, whether or not the aircraft’s onboard Emergency Locator Transmitter (ELT) functio ns. The track data can also be retrieved by the Anchorage Center if the aircraft i s reported missing or overdue, to determine the last known position.

To fully understand how ADS-B technology can augmen t ELT information for SAR, it is important to understand the mechanism of the ELTs, their reliability, and advances in technology and their associated costs. Currently Ge neral Aviation aircraft are required (by Congressional mandate in 1972) to equip with an ELT that is battery powered and activates upon severe impact. It is supposed to emi t a signal on a specified radio frequency. The original ELTs manufactured to FAA sp ecifications emitted a signal on the 121.5/243 MHz frequency. However, they had an activ ation rate of less than 25% in actual crashes and a 97% false-alarm rate, i.e., se nding SAR teams on missions where a signal was heard but no aircraft accident occurred. In 1985, a newer version became available that improved the activation rate to 73% in actual crashes but at a $200-500 cost plus cost of installation. In February 2009, howeve r, the 121.5 frequency was no longer being monitored for distress signals because of the high rate of false alarms. Recently, an even more advanced model has been developed (406 MH z) and it activates 81-83% of the time but they are relatively expensive.73

Additionally, hand-held, portable versions of an EL T called Emergency Position Indicating Radio Beacon (EPIRB) have become availab le. These types of tracking and alerting devices and services are growing in number and sophistication so it is only a matter of time until they will most likely leap-fro g 406 ELTs in reliability and functionality. For comparison of ELTs, see Table 5 2.

Table 52 Comparison of Emergency Locator Transmitters

Emergency Locator Transmitters (ELTs) – All are bat tery powered

ELT Cost to Operator in

addition to

avionics Activation

rate in

actual

accidents Comments

Original mandated (1973)

121.5/243MHz ELT

TSO-C91 Approx. $100 Less than

25% False alarm rate 97%

Improved ELT (1985)

121.5/243MHz

TSO-C91A $200-500 cost including

installation 73% February 1, 2009, the satellite system discontinued monitoring of 121.5/243 distress signals due to poor accuracy and high no. of false signals ICAO int’l required

406MHz ELT TSO-C126 (uses digital technology); voluntary in US $1,000 cost not including

installation 81-83% More accurate and near instantaneous; Allows SAR personnel to have vital information specific to operator

and aircraft

Emergency Position Indicating Radio Beacon (EPIRB). Variable cost;

hand-held (no installation) Depends on

the selected option EPIRBs are battery-powered,

very portable, completely waterproof, and they float. They have signal options.

However, ADS-B has the potential to be used to prov ide continuous positioning information, while also providing other services, s uch as weather and traffic information. This is especially useful if an aircraft is reporte d overdue or missing, yet no ELT signal has been observed. ADS-B does not depend on batter y-powered emission of a signal to indicate the last known position. It has been teste d and, in fact, used for rescue purposes in Alaska. A Capstone SAR example occurred in 2002 when a pilot flew from Bethel 75 miles north to the village of Marshall, Alaska. He didn’t return. As a National Guard helicopter prepared to launch for search and rescue operations, rescue organizers turned to air traffic controllers, who called upon the air craft’s ADS-B track and were able to vector the rescue helicopter directly to the aircra ft’s last known position. Barely two and a half hours after he was reported missing, the pil ot had been picked up, alive.74

More recently, in December 2008, in Colorado, where the installation of a wide-area multilateration (WAM) system was being tested, a gl impse of the benefit from having flight tracking data for SAR was realized. WAM is a surveillance system that is less robust and less sophisticated than ADS-B but it can be used for tracking flights. It is important to note that in this instance, WAM was no t being used for air traffic operations. However, when an aircraft was reported missing, whi ch was not under ATC radar surveillance, WAM data was reviewed to locate the l ast tracked position of the aircraft. In this type of terrain, if the estimate of the locati on of an accident is off by one valley, a day can be added to any search effort. The WAM data in this test-environment instance

reduced the search area from what would have been a pproximately a 30 by 30-mile area to a 1 by 1-mile area. The site was located within 3.5 hours of the accident. Unfortunately, there were no survivors but if there were, the likelihood of survival would have been greater since the threat of death from ex posure to the elements would not have

been a factor.

6.3 Enhanced Surveillance Where Radar is Currently Weak

The FAA's ADS-B rule is designed to replicate the c overage of FAA's current alignment of surveillance radars. The degree to which actual ADS-B coverage may exceed this requirement is currently unknown. Since ADS-B groun d stations are smaller, cheaper, and more flexibly deployed than conventional radar installations, it will be easier for the FAA to expand surveillance coverage and broadcast s ervices than it is today. The effective range of ADS-B ground stations is still l imited by line of sight considerations, but can extend down to the ground and can receive A DS-B signals from over 200 miles away. The relatively small size of ADS-B ground st ations should enable greater scalability of NAS surveillance, even in areas with challenging terrain such as the Rocky Mountains. An ADS-B compatible multilateration sys tem designed to provide surveillance to mountainous airports is already und er development in the state of Colorado. Opportunities for expansion of NAS surve illance capability will be examined on a case-by-case basis. Surveillance can also be e stablished through parties entering into agreements with the FAA that provide ADS-B services given considerations such as future ADS-B applications testing, early equipage o f ADS-B avionics, or cost-sharing.

The FAA’s SBS office has supported analysis of this additional service coverage at airport locations below the current minimum radar c overage. FAA estimates that there are potentially 1048 airports which may benefit fro m this coverage. The maximum potential aggregate national benefit, based on stan dard ASR benefit criteria, is projected to have a net present value (NPV) of $610 million b ut this does not account for any marginal costs for extending the currently proposed ITT ADS-B laydown and is not currently part of the proposed investment program.

Additionally, various states including Minnesota an d Wisconsin are contemplating piggy backing onto FAA’s ITT ADS-B implementation contrac t to expand the coverage beyond the current laydown to fill in gaps. For instance 5 airports in Minnesota will gain coverage under the ITT laydown that are not current ly covered down to 2000’ AGL. Minnesota is examining a supplementary purchase of ADS-B receivers to fill gaps in its75

coverage for another 16 airports and Wisconsin is c ontemplating purchasing two receivers to cover 13 airports.76 Appendix A Legacy Infrastructure Costs

Table A.1

Legacy Sustain Costs Under ADS-B Out Scenario 2009 $

Legacy Sustain

Airborne Legacy Sustain

Surface Total Legacy

Sustain 3% Discount

Rate 7% Discount

Rate Legacy

Sustain

Discounted

at 3% Legacy

Sustain

Discounted

at 7%

Total $588,393 $171,506 $759,899 $643,599 $530,535

Year

2009 $61,644 $24,084.52 $85,728 1 1 $85,728 $85,728

2010 $42,336 $19,223.37 $61,559 0.9709 0.9346 $59,766 $57,532

2011 $40,600 $16,054.30 $56,654 0.9426 0.8734 $53,402 $49,484

2012 $40,580 $17,320.57 $57,901 0.9151 0.8163 $52,988 $47,264

2013 $40,561 $14,252.63 $54,814 0.8885 0.7629 $48,702 $41,817

2014 $40,543 $14,252.63 $54,795 0.8626 0.7130 $47,267 $39,068

2015 $40,524 $14,252.63 $54,777 0.8375 0.6663 $45,875 $36,500

2016 $40,507 $13,528.50 $54,035 0.8131 0.6227 $43,935 $33,650

2017 $40,489 $19,551.44 $60,040 0.7894 0.5820 $47,396 $34,944

2018 $39,425 $12,306.07 $51,731 0.7664 0.5439 $39,647 $28,138

2019 $38,362 $6,679.76 $45,042 0.7441 0.5083 $33,515 $22,897

2020 $37,302 $0.00 $37,302 0.7224 0.4751 $26,947 $17,722

2021 $32,900 $0.00 $32,900 0.7014 0.4440 $23,075 $14,608

2022 $28,505 $0.00 $28,505 0.6810 0.4150 $19,410 $11,828

2023 $24,116 $0.00 $24,116 0.6611 0.3878 $15,944 $9,353

2024 $0 $0.00 $0 0.6419 0.3624 $0 $0

2025 $0 $0.00 $0 0.6232 0.3387 $0 $0

2026 $0 $0.00 $0 0.6050 0.3166 $0 $0

2027 $0 $0.00 $0 0.5874 0.2959 $0 $0

2028 $0 $0.00 $0 0.5703 0.2765 $0 $0

2029 $0 $0.00 $0 0.5537 0.2584 $0 $0

2030 $0 $0.00 $0 0.5375 0.2415 $0 $0

2031 $0 $0.00 $0 0.5219 0.2257 $0 $0

2032 $0 $0.00 $0 0.5067 0.2109 $0 $0

2033 $0 $0.00 $0 0.4919 0.1971 $0 $0

2034 $0 $0.00 $0 0.4776 0.1842 $0 $0

2035 $0 $0.00 $0 0.4637 0.1722 $0 $077 Table A.2

Legacy Backup Cost for ADS-B Out Surface and Airbor ne Backup (2009 K$)

Legacy Backup

Surface Legacy

Backup

Airborne Total Legacy

Backup 3%

Discount

Rate 7%

Discount

Rate Total Legacy

Backup

discounted

at 3% Total

Legacy Backup

discounted

at 7%

Total $0 $812,255 $812,255 $487,113 $263,286

Year

2009 $0 $0.00 $0 1 1 $0 $0

2010 $0 $0.00 $0 0.9709 0.9346 $0 $0

2011 $0 $0.00 $0 0.9426 0.8734 $0 $0

2012 $0 $0.00 $0 0.9151 0.8163 $0 $0

2013 $0 $0.00 $0 0.8885 0.7629 $0 $0

2014 $0 $18,423.60 $18,424 0.8626 0.7130 $15,892 $13,136

2015 $0 $18,423.60 $18,424 0.8375 0.6663 $15,429 $12,276

2016 $0 $18,423.60 $18,424 0.8131 0.6227 $14,980 $11,473

2017 $0 $18,423.60 $18,424 0.7894 0.5820 $14,544 $10,723

2018 $0 $18,988.94 $18,989 0.7664 0.5439 $14,553 $10,329

2019 $0 $19,554.28 $19,554 0.7441 0.5083 $14,550 $9,940

2020 $0 $20,119.62 $20,120 0.7224 0.4751 $14,535 $9,559

2021 $0 $22,332.81 $22,333 0.7014 0.4440 $15,664 $9,916

2022 $0 $24,546.00 $24,546 0.6810 0.4150 $16,715 $10,186

2023 $0 $8,604.32 $8,604 0.6611 0.3878 $5,688 $3,337

2024 $0 $54,134.42 $54,134 0.6419 0.3624 $34,747 $19,621

2025 $0 $54,134.42 $54,134 0.6232 0.3387 $33,735 $18,337

2026 $0 $54,134.42 $54,134 0.6050 0.3166 $32,752 $17,138

2027 $0 $54,134.42 $54,134 0.5874 0.2959 $31,798 $16,016

2028 $0 $54,134.42 $54,134 0.5703 0.2765 $30,872 $14,969

2029 $0 $54,134.42 $54,134 0.5537 0.2584 $29,973 $13,989

2030 $0 $54,134.42 $54,134 0.5375 0.2415 $29,100 $13,074

2031 $0 $54,134.42 $54,134 0.5219 0.2257 $28,252 $12,219

2032 $0 $54,134.42 $54,134 0.5067 0.2109 $27,429 $11,419

2033 $0 $54,134.42 $54,134 0.4919 0.1971 $26,631 $10,672

2034 $0 $54,134.42 $54,134 0.4776 0.1842 $25,855 $9,974

2035 $0 $28,935.91 $28,936 0.4637 0.1722 $13,417 $4,98378 Table A.3 Radar Decommissioning Costs (2009 K$)

Decommission ing 3% Discount

Rate 7%

Discount

Rate Decommissi

oning Costs

Discounted

at 3% Decommissioni

ng Costs

Discounted at

7%
Total $42,589 $29,636 $18,663

Year

2009 $0 1 1 $0 $0

2010 $0 0.9709 0.9346 $0 $0

2011 $0 0.9426 0.8734 $0 $0

2012 $0 0.9151 0.8163 $0 $0

2013 $0 0.8885 0.7629 $0 $0

2014 $0 0.8626 0.7130 $0 $0

2015 $0 0.8375 0.6663 $0 $0

2016 $416 0.8131 0.6227 $338 $259

2017 $623 0.7894 0.5820 $492 $363

2018 $3,740 0.7664 0.5439 $2,866 $2,034

2019 $3,740 0.7441 0.5083 $2,783 $1,901

2020 $3,532 0.7224 0.4751 $2,551 $1,678

2021 $8,726 0.7014 0.4440 $6,120 $3,874

2022 $8,726 0.6810 0.4150 $5,942 $3,621

2023 $7,479 0.6611 0.3878 $4,945 $2,901

2024 $5,609 0.6419 0.3624 $3,600 $2,033

2025 $0 0.6232 0.3387 $0 $0

2026 $0 0.6050 0.3166 $0 $0

2027 $0 0.5874 0.2959 $0 $0

2028 $0 0.5703 0.2765 $0 $0

2029 $0 0.5537 0.2584 $0 $0

2030 $0 0.5375 0.2415 $0 $0

2031 $0 0.5219 0.2257 $0 $0

2032 $0 0.5067 0.2109 $0 $0

2033 $0 0.4919 0.1971 $0 $0

2034 $0 0.4776 0.1842 $0 $0

2035 $0 0.4637 0.1722 $0 $079 Table A.4 Other Legacy Costs for ADS-B Out Scenario (2009 K$)

Legacy Upgrade Remaining

ASDE-3

Surface 3% Discount

Rate 7% Discount

Rate ASDE-3

Discounted

at 3% ASDE-3

Discounte

d at 7%

Total $252,998 $204,828 $162,372

Year

2009 $0.0 1 1 $0 $0

2010 $0.0 0.9709 0.9346 $0 $0

2011 $6,222.9 0.9426 0.8734 $5,866 $5,435

2012 $76,603.5 0.9151 0.8163 $70,103 $62,531

2013 $42,394.2 0.8885 0.7629 $37,667 $32,342

2014 $34,398.0 0.8626 0.7130 $29,672 $24,525

2015 $7,313.5 0.8375 0.6663 $6,125 $4,873

2016 $7,313.5 0.8131 0.6227 $5,947 $4,554

2017 $3,045.1 0.7894 0.5820 $2,404 $1,772

2018 $3,045.1 0.7664 0.5439 $2,334 $1,656

2019 $3,045.1 0.7441 0.5083 $2,266 $1,548

2020 $3,045.1 0.7224 0.4751 $2,200 $1,447

2021 $21,115.2 0.7014 0.4440 $14,810 $9,375

2022 $3,045.1 0.6810 0.4150 $2,074 $1,264

2023 $3,045.1 0.6611 0.3878 $2,013 $1,181

2024 $3,045.1 0.6419 0.3624 $1,955 $1,104

2025 $3,045.1 0.6232 0.3387 $1,898 $1,031

2026 $3,045.1 0.6050 0.3166 $1,842 $964

2027 $3,045.1 0.5874 0.2959 $1,789 $901

2028 $3,045.1 0.5703 0.2765 $1,737 $842

2029 $3,045.1 0.5537 0.2584 $1,686 $787

2030 $3,045.1 0.5375 0.2415 $1,637 $735

2031 $3,045.1 0.5219 0.2257 $1,589 $687

2032 $3,045.1 0.5067 0.2109 $1,543 $642

2033 $3,045.1 0.4919 0.1971 $1,498 $600

2034 $3,045.1 0.4776 0.1842 $1,454 $561

2035 $5,870.5 0.4637 0.1722 $2,722 $1,01180 Appendix B – Reduced Delay over Gulf of Mexico

Increased Capacity over the Gulf of Mexico - Benefi ts of Reduced Delay

Current non-radar separation in the Gulf of Mexico constrains the number of flights that can operate in each of the Air Route Traffic Contro l Center Gulf (ARTCC) sectors (ZHU79 and ZHU72). According to ZHU controllers ma ny flights experience ground or air delay because of this constrained airspace. Cu rrently delay only occurs during highly seasonal peak traffic days. 82 As demand increases we expect days with delays to

increase.

The first step in the analysis was to estimate the increase in capacity that might reasonably be achieved by radar-like separation. D iscussions with representatives from Houston Center revealed that the monitor alert para meter (MAP) value 83 is 12 for Sector ZHU 72and 18 for sector ZHU 79, the two sectors com prising the high altitude airspace over the Gulf of Mexico. The average time an aircr aft spends in the region (both sectors) is 32 minutes. Combining these gives an hourly cap acity of 56 aircraft in today’s environment. Once ADS-B Out is implemented in the Gulf of Mexico and assuming a 5 mile separation standard is approved based on ADS-B Out data being available for separation purposes, the hourly capacity for sector s in the Houston CTA 84 /FIR 85 is

estimated to increase from 56 to 84 aircraft. This capacity is higher than that used in the NPRM due to the following recently planned enhancem ents not originally known: Houston Center is now planning a 3 rd GOMEX high altitude sector raising the combined MAP value for all 3 sectors to an estimated 45; sec ond, a new RNP-10 route structure

will add to the number of routes available and ther eby add to the capacity of the airspace; third, Merida Center plans to add an additional hig h altitude sector to increase Mexico’s capacity in receiving and transferring aircraft acr oss the common boundary with Houston, and lastly, additional capacity at key airports in Mexico is expected to be complete soon, further alleviating the constraints built into the original capacity estimates for Mexico.

We started with actual operations over the Gulf of Mexico for each day in 2008. This

data was obtained from the FAA Air Traffic Data Act ivity System (ATADS) Houston Oceanic operations counts for each day in 2008. 86

For example, on December 31, 2008, there were a tot al of 308 oceanic operations tracked by the Houston Center (ZHU). This represents the n umber of operations over the Gulf of Mexico on that day as displayed in Table B.1 below.

82 ATO En Route Services, Surveillance and Broadcast Services Benefits Basis of Estimate, June 2006, FAA ATO, pg. 41.

83 The MAP value is the maximum number of aircraft th at can be managed by a sector simultaneously with the exception that the MAP value can be exceeded fo r brief intervals.

84 Control Area: A control area is airspace wholly co ntained beyond the 12 mile limit whereby an ICAO state has been designated as the ATS authority for the control of air traffic

85 Flight Information Region: FIR’s designate regions for informational service's only, not ATC control.

86 Available on the FAA Office of Policy and Plans (A PO) website: http://www.apo.data.faa.gov/81 Table B.1 Number of Flights over the Gulf of Mexico on 12/31/ 2008

CENTERS: Oceanic

Oceanic

Departures Overflights

Date Air
Carrier Air
Taxi General
Aviation Military Air

Carrier Air
Taxi General
Aviation Military Total Total

12/31/2008 0 0 0 0 267 4 18 19 308 4,702

Total: 0 0 0 0 267 4 18 19 308 4,702

In this way, we collected the number of operations over the Gulf of Mexico for every day in 2008. The second column of Table B.2 (highlight ed in yellow) gives a snapshot of the number of actual operations organized from high to low for the 31 days in 2008 with the highest number of operations. The highest operatio n day in 2008 was 616. Then we reduced the number of operations by 10% to account for operations that only made small

incursions into oceanic sectors. The third column in Table B.2 is a snapshot of the starting point from which we forecast operations to represent future years.82 Table B.2 Estimated Number of Flights Per Day

ATADS

2009 ATADS reduced by

10% 1.4% 4.3% 5.2% 5.8% 5.5% 4.5% 4.2% 4.1% 4.1% Start of 4% growth
Day 2008 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

1 616 554 562 586 616 652 688 719 749 780 812 844 878

2 572 515 522 544 572 606 639 668 695 724 754 784 815

3 567 510 517 540 567 601 634 662 689 718 747 777 808

4 539 485 492 513 539 571 602 629 655 682 710 739 768

5 532 479 485 506 532 563 594 621 647 674 701 729 758

6 530 477 484 504 530 561 592 619 644 671 698 726 755

7 525 473 479 500 525 556 587 613 638 665 692 720 748

8 511 460 466 486 511 541 571 597 621 647 673 700 728

9 505 455 461 481 505 535 564 590 614 639 666 692 720

10 500 450 456 476 500 530 559 584 608 633 659 685 713

11 490 441 447 466 490 519 547 572 596 620 646 672 698

12 488 439 445 464 488 517 545 570 593 618 643 669 696

13 483 435 441 460 483 512 540 564 587 611 637 662 688

14 473 426 432 450 473 501 528 552 575 599 623 648 674

15 469 422 428 446 469 497 524 547 570 594 618 643 669

16 465 419 424 442 465 493 520 543 565 589 613 637 663

17 464 418 423 442 464 491 518 542 564 587 611 636 661

18 464 418 423 442 464 491 518 542 564 587 611 636 661

19 461 415 421 439 461 488 515 538 561 584 608 632 657

20 458 412 418 436 458 485 512 535 557 580 604 628 653

21 457 411 417 435 457 484 511 533 556 579 602 626 651

22 453 408 413 431 453 480 506 529 551 574 597 621 646

23 451 406 412 429 451 478 504 526 548 571 594 618 643

24 450 405 411 428 450 477 503 525 547 570 593 617 641

25 449 404 410 427 449 476 502 524 546 568 592 615 640

26 449 404 410 427 449 476 502 524 546 568 592 615 640

27 445 401 406 423 445 471 497 519 541 563 586 610 634

28 444 400 405 422 444 470 496 518 540 562 585 609 633

29 435 392 397 414 435 461 486 508 529 551 573 596 620

30 431 388 393 410 431 457 482 503 524 546 568 591 614

31 430 387 392 409 430 455 480 502 523 544 567 589 613

To forecast operations for years out to 2035, we de rived total operations for the U.S. to and from Latin America using several forecasts from the 2009 FAA forecast. 87 We multiplied the average seats per aircraft (internat ional) 88 by the scheduled passenger capacity and load factors 89 to obtain passengers per aircraft. Then we divide d the total passenger traffic to and from the U.S. from Latin A merica 90 by the average passengers per aircraft 91 to derive the estimated total flights and computed the percent change in operations from year to year, as presented in Table B.3.

87 FAA Aerospace Forecasts, Fiscal Years 2009-2025, U .S. Department of Transportation, Federal Aviation Administration, Office of Policy and Plans.

88 Table 9 FAA Aerospace Forecasts, Fiscal Years 2009 -2025

89 Table 13 FAA Aerospace Forecasts, Fiscal Years 200 9-2025

90 Table 8 FAA Aerospace Forecasts, Fiscal Years 2009 -2025

91 Table 9 FAA Aerospace Forecasts, Fiscal Years 2009 –202583 Table B.3 Forecast of High Altitude Operations in Gulf of Mex ico84

Using the estimated growth in operations up to year 2018 as presented in the last column

of Table B.3 and derived from the FAA forecast 92 and an assumed 4% growth rate after 2018, we increased each daily number of flights sta rting in the third column of Table B.2 out to the year 2035. The percent change in operat ions (shown in the last column of Table B.3) is indicated on the top row of Table B.2 above (which shows a snapshot of flights growing per year). The specific tables fro m which the numbers in Table B.3 originate in the FAA forecast are indicated in the top row of Table B.3.

Next we took our forecast (Table B.2 – Estimated Nu mber of Flights per Day) and counted the number of days for each year that would experience operations falling into various daily demand groupings. Table B.4 presents a snapshot of these groupings for selected years. For instance, we estimate that in 2015 there will be four days during which high altitude operations will be less than 20 0, 33 days with operations from 200 to 249, 42 days with 250 to 299 operations and so on.

92 FAA Aerospace Forecasts Fiscal Years 2006-2017, U. S. Department of Transportation, Federal Aviation Administration Office of Policy & Plans.85 Table B.4 Unconstrained Daily Demand 93

In order to estimate the delay for each level of op erations under the base case scenario (no surveillance over the Gulf) and under the ADS-B Out scenario (ADS-B surveillance over the Gulf) a queuing model developed by MCR Fed eral was used.

To run the queuing model with hourly capacities, we needed an hourly demand profile. ZHU ARTCC provided the hourly demand profile based on the four busiest days in 2003. This profile was applied to the midpoint of each of the daily operations groupings to derive an hourly demand profile for each level of o perations. Table B.5 displays the hourly demand profile for a day for 675 flights (re presenting the midpoint of operations from 650 to 699). For example, 12.8% of the 675 op erations or 86 operations occurs at

10 a.m.

93 A complete table of unconstrained daily demand sho wing number of days for each year from 2009 to 2035 in each daily demand group can be found in Tab le B.14 below.86 Table B.5 Hourly Demand Profile on Peak Days

This hourly demand distribution for the midpoint of each daily demand grouping was input into the queuing model. The queuing model wa s then run for the base case capacity (56 aircraft per hour) and the surveillance capacit y (84 aircraft per hour). The queuing model produced a probability distribution of delay minutes for each grouping.

We assume that delays beyond 20 minutes per flight are not acceptable 94 and we will not accommodate demand for flights if the delay is expe cted to surpass 20 minutes. According to the queuing model 20-minute delays are encountered at daily flight levels

of 675 under the baseline and 1025 under the survei llance case. We therefore constrain

demand at 675 for the baseline and at 1025 for the surveillance case. Table B.6 shows demand constrained at 675 flights for the baseline and Table B.7 shows demand constrained at 1025 flights for the surveillance ca se.

94 “approximately 20 minutes represents the highest l evel of average delay realized in actual practice e ven at highly congested airports, FAA Airport Benefit C ost Analysis Guidance, page 16, FAA Airport Benefit Cost Analysis http://www.faa.gov/regulations_polici es/policy_guidance/benefit_cost/media/faabca.pdf87 Table B.6 Daily Demand Constrained at 675 Flights 95 – Baseline

95 A complete table of daily demand constrained at 67 5 flights showing number of days for each year from 2009 to 2035 in each daily demand group up to and i ncluding 675 can be found in Table B.22 below.88 Table B.7 Daily Demand Constrained at 1025 Flights – Surveill ance Case

Table B.8 shows the results of the queuing model wh en run for a daily demand level of 675. The results show that at 675 daily flights the re will be 13500 minutes of total delay for the base case capacity and 86 minutes total del ay for the surveillance capacity at the

50 th percentile. This works out to 20 minutes per flig ht under the base case and .13 minutes per flight under the surveillance scenario. The daily savings in hours between

the base case and surveillance case is estimated to be 224 at a daily flight level of 675 ((20-.13) x 675/60).89 Table B.8 Delay for Baseline (56/hour) and Surveillance (84/h our) Scenarios at a Daily Flight Level of 675

At daily demand levels beyond 675, for the base cas e since we capped flights at 675 we calculate delay of 20 minutes for each of the 675 f lights ((20 x 675)/60=225 hours). Then we subtract the surveillance delay which is (. 41 x 725)/60 = 4.95) and subtract from the baseline delay (225-4.95 =220 hours) for the ne t savings in hours with ADS-B.

Table B.9 Results of Queuing Model for Base Case and Surveill ance Case at 725 Daily Flights90

The daily delay in minutes at each demand level for the baseline and surveillance is presented in Table B.10. For instance, at a demand level of 675 we estimated delays of 20 minutes per aircraft under the baseline and .13 minutes with surveillance using the queuing model. We then convert to total delay hour s per year by multiplying the delay times the midpoint of the daily flights (or demand) grouping times the number of days that we have forecast for that grouping divided by 60. So for a demand level of 675, under the baseline, the delay is calculated as foll ows: (20 x 675 x 76)/60 = 17,100.

For the ADS-B surveillance case, delays of 20 minut es occur at 1025 flights. We do not accommodate flights beyond that level and calculate delay hours per year as we did for

the baseline. So for a demand level of 975 under t he ADS-B surveillance case, the delay is calculated as follows: (13.31 x 975 x 3)/60 = 64 9.

Total delay in hours under the baseline is 22,680 a nd under the surveillance case it is 2,977. The surveillance case results in a savings of 19,703 hours relative to the baseline

in 2025 as illustrated in the table below.91 Table B.10 Delay Savings for Daily Flight Levels of Demand

We assume that capacity would be phased in starting in year 2012 to reach full compliance by 2020 as presented in Table B.11. 96 Therefore, the full amount of delay savings cannot be achieved until 2020. Table B.11 summarizes annual delay savings in hours and indicates phasing in of equipment with th e resulting hours that we estimate will

be saved under the surveillance case relative to th e baseline. It then computes an economic value of the delay hours saved. The facto rs used in computing the economic value of delay savings benefits are in Table B.13.

96 The phasing depends on estimated Gulf equipage and allocation of ADS-B separation to more altitudes

over time.92 Table B.11 Annual Delay Savings in Hours, Capacity Phasing, Ho urs Saved and Economic

Value of Delay Savings (2009 M$)

Table B.12 Passenger Value of Time 97

, 98 99

97 Source for Passenger Capacity and Load Factor is “ Supporting Documentation for the Economic Factors Used in Investment Analysis,” pg. 17, Federal Aviat ion Administration, December 7, 2006, Final.

98 Source for Hourly Values of Time 2000 U.S. $ Per P assenger is “Economic Values for FAA Investment and Regulatory Decisions, A Guide, Draft final Repo rt, December 31, 2004, Prepared for FAA Office of Aviation Policy and Plans.

99 GDP Chained Price Index, Budget of the United Stat es Government, Fiscal Year 2007, Table 10.1—

Gross Domestic Product and Deflators Used in the Hi storical Tables: 1940-2011.93 Table B.13 Factors Used to Compute Economic Value

The dollar value of one hour of delay savings was c alculated using the factors in Table B.13. The distribution of traffic among air carrie r and commuter, air taxi, GA and military was computed using the oceanic overflight data from ATADS. This provided a weighting for the hourly costs of delay.

Aircraft direct operating costs (ADOC) are estimate d per hour on the ground as $2,037 for air carriers TAF, $533 for air taxis and $297 f or general aviation. 100 Average passenger value of time is derived by multiplying p assenger capacity by load factor 101 to derive passengers per aircraft and multiplying pass engers per aircraft by the hourly value of passenger time 102 . These values are presented in Table B.13. Value s used to calculate hourly passenger value of time per aircraft is foun d in Table B.12.

The value of $3,857 per one hour of delay savings w as derived by taking a weighted average of the sum of ADOC ground operating costs a nd the average passenger value of time for each type of operations, weighted by the p ercent of traffic accounted for by each type. This value was then multiplied by the hours saved (Table B.11) each year to derive an economic value of delay savings. These delay sa vings were then discounted at 3% and 7%. The analysis did not take into account any downstream delay savings that might be achieved due to ADS-B. Downstream delay occurs when an aircraft that is delayed causes further delays in the system. Therefore, th e benefits are underestimated.

We estimated the benefits of avoiding delays that w ould be encountered by high altitude operations are $1.7 billion or $946 million when di scounted at 3% and $463 million when discounted at 7%. These results are presented in Table B.11.

100 Economic Information for Investment Analysis Data Package, Prepared for Operations Research/ATOF, pg. 6, Federal Aviation Administration, April 2 4, 2009.

101 Economic Information for Investment Analysis Data Package, Prepared for Operations Research/ATOF, pg. 7, Federal Aviation Administration, April 2 4, 2009.

102 Source for Hourly Values of Time 2000 U.S. $ Per P assenger is “Economic Values for FAA Investment and Regulatory Decisions, A Guide, Final Report, Oc tober 3, 2007, Prepared for FAA Office of Aviation Policy and Plans.94

Additional Flights Accommodated by ADS-B

As mentioned above, our analysis assumes that fligh t delays in excess of 20 minutes will

not be tolerated. Demand levels that could result in flight delays above 20 minutes are not accommodated. The queuing analysis indicated t hat without surveillance over the Gulf, delays of 20 minutes occur at a level of oper ations of 675 per day. If there is surveillance, (as would be the case with ADS-B) del ays would occur at daily flight levels of 1025. On days that we anticipate demand in exce ss of 675, ADS-B technology would accommodate more flights. Starting in 2014 we fore cast that there will be days on which daily flight demand will exceed 675 as indicated in Table B.15. In this analysis we assume that with ADS-B surveillance flights between 675 and 1025 per day will be accommodated, as explained below.

Table B.14 Unconstrained Daily Demand

The difference in number of flights that would be a ccommodated given ADS-B surveillance in the Gulf of Mexico are presented in Table B.15 below. For each demand level above 675, the difference in flights between that level and the next (50 flights) is95

multiplied by the number of days that we expect tha t level of demand according to our

forecast.

Table B.15

Additional Flights Accommodated Because of Surveill ance

For instance, according to our forecast, in 2016 th ere will be 2 days, during which demand will reach 725 flights per day and one day d uring which it will reach 775 flights. ADS-B technology will allow an additional 50 flight s above the level that will be tolerated without surveillance for each of 2 days ( (725-675) x 2 = 100) and an additional 100 flights (775-675 x 1 =100) for the one day with 775 flights. The technology will allow for the accommodation of 200 more flights in 2016 than the base case.

Consumer Surplus Analysis

Assumptions

• Over the time horizon there will be no change in th e size of the airplane, no change in the load factor and no change in the curr ent way goods are delivered.

• Elasticity of demand β = -1 103

.

103 To better capture aggregate consumer responses to a change in federal policies, FAA frequently adopts a unitary elastic demand curve, for example, see FA A’s 1995 Cost Allocation Study. Estimates of the own-price elasticity of demand typically range betw een -0.7 to 1.5. The lower bound of -0.7 is frequen tly

cited as an estimate for short-haul business travel while the upper bound is an estimated for long-hau l

domestic travel. In a book titled “Straight and Level: Practical Airline Economics” (2008), Stephen Holloway reports other own-price elasticities incl uding a -1.04 for long-haul international business travel and a -1.15 for long-haul domestic business. Simil arly, if one considers the meta-study conducted in 2002 by Gillen, Morrison, Stewart, Air Travel Demand Elasticities: Concepts Issues and Measurement, a -1 own-price elasticity clearly falls within the inter val estimates reported in that study.96

To estimate the economic benefit associated with th e additional passengers as a result of implementing ADS-B, a consumer surplus approach was adopted. For the purpose of calculating the net surplus triangle it is assumed that the demand curve over the relevant range of aircraft operations can be approximated by a constant elasticity of demand curve, i.e, P(q) = aq -1 , with the price elasticity of demand equal to - 1. The following formula is then used each year to calculate the con sumer surplus associated with the additional passengers:

where P(q) is the unit elasticity demand curve, Q1 is the number of passengers without ADS-B, Q2 is number of passengers with ADS- B.

Figure 1 graphically illustrates this calculation f or a given year. The net economic benefit associated with serving additional passenge rs is represented by the shaded area. The vertical axis measures the natural log of avera ge air fare; the horizontal axis measures the natural log of average seats.

Figure 1

Table B.16 displays the data for each year used in the consumer surplus. P 1

P 2 Ln ( Fare)

Ln ( Seats) Q 2 Q 1 D t97 Table B.16 Consumer Surplus Estimates98

Optimal and More Direct Routing Benefits

The FAA examined the top twenty city pairs from the US to Mexico and south whose direct paths crossed the non-radar region for April 2003 and estimated savings in nautical miles (NM-I) that could result with radar-like sepa ration. Appendix C describes in more detail how these savings were estimated. Table B.1 7 shows the savings in NM for the month of April 2003 for twenty city pairs over the Gulf that could have been achieved

with the creation of more efficient routes. 104 There were a total of 4,063 flights between the twenty city pairs in April 2003. Of these flig hts, 1,105 were flights that flew through the non-radar region that could have benefitted fro m optimal routing. The table shows how much savings in NM could be achieved through op timal routing for flights between each city pair. For instance, direct routing could save 18.3 NM for flights operating between Miami (MIA) and Mexico City (MMMX). A pote ntial average savings of 15 NM could be achieved by flights that operate betwee n the twenty city pairs.

We estimate the number of flights per year that fly through non-radar regions and could potentially save 15 NM per flight with more optimal routing. In April of 2003 there were 1105 of these flights. April represents about 9% o f the yearly traffic load. We estimate that in 2003 there were about 12,266 flights throug h the non-radar regions that could have derived benefit from optimal routing. We esti mate that these flights will grow at about 4% a year. Optimal routing could save each o f these flights 15 NM each. Table B.20 below indicates the annual number of flights a nd total savings each year that might be achieved from optimal routing.

Another 756 flights avoided the non-radar region ei ther because the aircraft or crew may not be certified to fly that far from shore or beca use of limited capacity along the nonradar routes because of traffic. Some of these fli ghts could be granted a more direct route

with the advent of surveillance. We estimate that flights that could benefit from direct routing through the Gulf is equal to about 10.8% of the number of flights through the

Gulf. 105

Table B.17 shows how much savings in NM could be ac hieved if these flights could fly through the non-radar area. For instance, flying t hrough the non-radar region could save a flight between Miami (MIA) and Mexico City (MMMX) 30.8 NM. We estimate that direct routing could save these flights on average 67.8 NM per flight.

104 ATO En Route Services, Surveillance and Broadcast Services Benefits Basis of Estimate, June 2006, Federal Aviation Administration, Air Traffic Organi zation, pg. 53

105 These flights that currently avoid the non-radar r egions of the Gulf are not included in the count of flights that fly through the Gulf.99 Table B.17 Optimal Route Savings Between Selected City Pairs B ased on April 2003 Flights

Table B.18 Dollar Value of an Hour Saved with Optimal and More Direct Routing City 1 City2 Number of Flights Count of

flights already

on optimal

route or

weather

related Count of

current

non-radar flights Savings per

flight

current nonradar

routes (nmi) Count of

flights that

avoided region Savings per

flight that

avoided nonradar route (nmi)

Total savings

(nmi)

MIA MMMX 574 0 292 18.3 282 30.8 14,030

IAH MMUN 338 183 155 12.4 1922

DFW MMUN 292 156 136 2.6 354

ATL MMMX 271 152 119 5.8 690

MSP MMUN 215 215 0

ATL MMUN 219 122 97 30.6 2968

ORD MMUN 212 169 10 30.6 33 82.3 3022

JFK MMMX 217 118 99 5.8 574

CLT MMUN 198 6 8 30.6 184 82.3 15,388

EWR MMUN 185 73 61 30.6 51 82.3 6064

IAH MZBZ 183 183 0

DTW MMUN 168 117 17 30.6 34 82.3 3318

EWR MMMX 158 91 67 5.8 389

DEN MMUN 137 66 71 133.3 9464

IAH MROC 126 126 0

STL MMUN 130 130 0

IAH MGGT 116 111 0

IAH MSLP 111 111 0

PHL MMUN 108 24 9 30.6 75 82.3 6448

JFK MMUN 105 44 35 30.6 26 82.3 3211

TOTAL 4063 2197 1105 264.9 756 67,842100 Table B.19 Daily Demand Constrained at 625101 Table B.20 Value of Optimal and More Direct Routing Over the G ulf of Mexico (2009 $M)

We estimated total savings in nautical miles that c ould be achieved by more direct routes through the Gulf by estimating the number of flight s that could fly these routes (10.8% of the number of flights over the Gulf) and multiplyin g that by an average savings of 67.8 NM per flight. Because adding these additional fli ghts into the Gulf would also add demand to the High Altitude capacity model, we deci ded that the benefit would only accrue on days where there is little to no delay an d we chose days with a demand level of less than 625. To estimate number of flights per y ear we multiplied the number of days that we expected demand to be at various levels tim es that level and times 10.8% and

summed all the levels. Table B.19 shows number of days each year that we would encounter various daily demand levels. For instanc e, in 2015 we expect there will be 42 days when there will be an average demand for 275 f lights. We multiply 42 by 275 and by 10.8% and do this for all the daily demand bins up to, but not including 675, and sum the results for an estimated 14,302 flights that co uld benefit from more direct routes over the Gulf. We then multiply the number of flights b y the average savings per flight (14,302 x 67.8) to derive a total potential savings for 2015 of 971,099 NM. These benefits are achieved as capacity is phased in, beg inning in 2012, based on industry equipage. We computed total savings (NM) (632,850 for 2015) by adding potential optimal non-radar route savings (294,600 for 2015) to potential additional flight savings (971,099 for 2015) and multiplying the sum by the p ercent capacity phasing (50% for 2015)

.102

To monetize these savings we converted total saving s into hours saved by dividing total savings (NM) by an average airspeed of 390 (632,850 divided by 390 for 2015). We then converted hours saved to value of hours saved by mu ltiplying hours saved by the sum of the weighted averages of aircraft direct operating costs airborne and the passenger value of time as presented in Table B.18 ($5,599). Refer to Table B.20 for potential savings in miles, savings converted to total savings in miles, total savings in hours and total savings converted to dollars (benefits) and discounted bene fits.

The result was an estimated benefit of $384.37 mill ion dollars ($245.39 million when discounted by 3% and $143.82 million when discounte d by 7%) as indicated in Table

B.20.103Table B.21Unconstrained Daily Demand104Table B.22Daily Demand Constrained at 675 Flights105Table B.23Daily Demand Constrained at 1025 Flights106Table B.24Additional FlightsAppendix C Optimal Routing

Details on Optimal Routing of High Altitude Operati ons Over the Gulf of Mexico

Optimal Routing Of High Altitude Operations Over th e Gulf of Mexico

Problem: Due to the lack of surveillance and limited commun ication at high altitudes, non-radar separation procedures restrict aircraft t o the available airways.

Capability/Direct Impact: By providing surveillance and improved communicati on services, radar-like separation can be applied whic h enables enhanced dynamic air traffic management. Enhanced dynamic traffic management ca n, in effect, increase the number of available airways by granting directs.

Outcome/Benefit : Enhanced dynamic air traffic management increases direct routing, which should lead to a reduction in flight distance s and times. Reduction in flight distances and times translates to savings in aircra ft direct operating costs and passenger

value of time.

Baseline Information : Current flights between Gulf city pairs either f ile one of the 10 available non-radar routes, or file a path that avo ids the non-radar region completely. Figure 1 displays the non-radar region, the non-rad ar routes, and two important SUAs

that constrict traffic.

Flights crossing the non-radar region of the Gulf o f Mexico are constrained to routes with set entry and exit fixes. Because of spacing restr ictions and arrival/departure stream flows, controllers sometimes treat routes as one-wa y corridors. The addition of surveillance across the gulf would provide more opt imal routing to flights that already file within the non-radar region in two ways. Firs t, it would allow new entry/exit locations on the U.S. side of the region. The abil ity to allow new entry/exit points on the U.S. side should allow controllers to grant more di rects from U.S. locations to the fixes on the Mexican airspace border. Second, it would a llow controllers to build additional routes. Although the necessity of creating one-way routes for separating arrival and departure streams will still exist, controllers can build these routes much closer together than is possible with the current non-radar separat ion standards. This addition of airways

should allow both inbound and outbound traffic to f ly paths closer to the optimal route.

Flights that avoid the non-radar region may do so b ecause the aircraft or crew may not be certified to fly that far away from shore, or the c apacity along the non-radar routes may be limited due to traffic or weather [flights that are constrained due to capacity or lack of surveillance accounts for 10.8% of flights between city pairs]. Added surveillance should increase capacity along current non-radar routes an d allow addition of available routes, and assumed equipage of these flights should allow them to take the more optimal routes through the Gulf.108

Figure 1. Airspace and routes in the Gu lf of Mexico.

The light shaded region is the non-radar airspace. The dark shaded regions are two Special Use Airspa ce (SUA) areas. The lines in the light shaded region are the current routes through the region.

We first examined the top twenty city pairs from th e US to Mexico and south whose direct paths crossed the non-radar region for April 2003. We chose to examine savings in

terms of excess distance between current routes and more direct routes, where possible. The data source was ETMS-recorded filed flight path s. We considered savings from the two general categories mentioned in the previous pa ragraphs.

For flights that already fly through the non-radar region, we explored if the current route was the most optimum of the available routes to the destination. If not, we assumed the addition of surveillance would increase capacity al ong the more optimum route and additional parallel routes would be created to allo w more direct paths between entry and exit points. In some situations, we also examined if directs from US locations to current

fixes on the Mexican border would save distance.

We also investigated savings for flights that avoid ed the non-radar region. An attempt

was made to determine if these circuitous routes ar ound the region were weather-related. If a route between city pairs was filed more than 2 0% of the time, we assumed that it was not weather-related, but involved either capacity o r equipage considerations. We

removed routes filed less than 20% of the time from the analysis. Savings for this second109

category focused on allowing these flights to take the more optimal non-radar region

route.

Table C-1 displays the excess distance data for the top twenty city pairs. The savings are broken into columns for flights that took routes th rough the non-radar regions and those who avoided the non-radar region.

Table C-1

Optimal route savings between selected city pairs

City 1 City2 Count Count

of flights already

on optimal

route or
weather

related Count

of

current

nonradar flights Savings

per flight

current

nonradar

routes (NM) Count

of flights

that

avoided region Savings

per flight

that

avoided

nonradar

route (NM) Total

savings (NM)

MIA MMMX 574 0 292 18.3 282 30.8 14,030

IAH MMUN 338 183 155 12.4 1922

DFW MMUN 292 156 136 2.6 354

ATL MMMX 271 152 119 5.8 690

MSP MMUN 215 215 0

ATL MMUN 219 122 97 30.6 2968

ORD MMUN 212 169 10 30.6 33 82.3 3022

JFK MMMX 217 118 99 5.8 574
CLT MMUN 198 6 8 30.6 184 82.3 15,388

EWR MMUN 185 73 61 30.6 51 82.3 6064

IAH MZBZ 183 183 0

DTW MMUN 168 117 17 30.6 34 82.3 3318

EWR MMMX 158 91 67 5.8 389

DEN MMUN 137 66 71 133.3 9464

IAH MROC 126 126 0

STL MMUN 130 130 0

IAH MGGT 116 111 0

IAH MSLP 111 111 0

PHL MMUN 108 24 9 30.6 75 82.3 6448

JFK MMUN 105 44 35 30.6 26 82.3 3211

TOTAL 4063 67,842110

Using only these twenty city pairs and the fact tha t April represents 9% of the yearly traffic load, we estimate savings of approximately 750,000 NM a year from more optimal

routes.

MIA-MMMX

While most routes across the non-radar region are a lready direct, there is one notable exception. The most travel in the non-radar region takes place between Miami and Mexico City (574 flights in April 2003). The northe rn route (292 flights April 2003) between Miami and Mexico City has a turn in the gul f designed to avoid an SUA just west of the Florida Keys. With better surveillance , a new route, or a direct could be granted that would cut 18 NM off the current route and still avoid the SUA. This new

route would also be 31 NM less than the current sou thern route (282 flights April 2003) that does not penetrate the non-radar region. See Figure 2.

Figure 2: Routes between Miami and MMMX.

The light shaded region is the non-radar region and the dark shaded regions are two SUA areas. The so lid

lines are common northern and southern routes. The dashed line is the proposed shorter route.

IAH-MMUN

The current route structure includes non-radar rout es that are close to the optimum path between major city pairs (e.g. IAH-CUN, IAH- MID). However, many times one of these routes is used as a one-way corridor causing flights in the opposite direction to use111

a non-optimum route. Although the necessity of cre ating one-way routes for separating arrival and departure streams may still exist, cont rollers can build these routes much closer together than is possible with the current n on-radar separation standards. This addition of airways should allow both inbound and o utbound traffic to fly a route closer to the optimal route.

During April 2003 there were 338 flights between IA H and MMUN. Half the flights (nearly all from IAH to MMUN) flew on the solid pat h flown in Figure 3. If we assume the same departure path (which ends on the MUSYL fi x), we find that the dotted path (not a current route) is 12 NM shorter than the flo wn route. Most of the flights from MMUN to IAH already go on a very direct route. The re were very few flights that did not cross the non-radar region between these cities , and their path may be weather

related.

Figure3: Route from IAH to MMUN.

The solid line is most common route April 2003; the dashed line is shorter route by 12 miles. The lig ht shaded region is the non-radar region.112

Northeast-MMUN

Most of the flights during April 2003 from CLT, JFK , and EWR to MMUN and back generally followed one of the three paths seen in F igure 4. Most flights from ATL to

MMUN and some from both DTW and ORD also took simil ar routes to MMUN with some variation at the extreme North of Figure 4. B etween all of these city pairs there are more routes that avoid the non-radar region (Florid a route) than can be explained because

of weather.

If capacity were to increase because of surveillanc e, then most of these flights could take a route close to the optimum middle route (dashed p ath in Figure 4) saving 30.6 NM over

the western case and 80.2 NM over the Florida route

.

Figure 4. Routes between Northeast and MMUN.

All lines are common routes (April 2003). The dashe d line is most optimum route. The light shaded regi on is the non-radar region and the dark shaded regions are two SUA areas.113

East-MMMX

Flights from JFK, EWR, and ATL to MMMX during April 2003 generally took one of the two routes shown in Figure 5. The southern rou te is more direct by 5.8 NM. If capacity were to increase, more of these flights co uld take a route closer to the southern route. A few of the recorded flights took routes t hat did not penetrate the non-radar region. There were so few of these that we assume these deviations were weather related.

Figure 5. Routes between East and MMMX.

The solid lines are common routes. The light shaded region is the non-radar region and the dark shaded regions are two SUA areas.

DEN-MMUN

Flights from DEN to MMUN in April 2003 took one of two routes. Over half filed a southern route that entered Mexico near McAllen, Te xas and hugged the coast before flying to MMUN (dotted path in Figure 6). The more direct filed route through the nonradar region is over 400 NM shorter than the southe rn route.

Over half the return flights from MMUN to DEN have filed routes that start with a NAVAID directly across from McAllen, Texas. We sus pect that these flights also followed a route similar to those on the trip from DEN to MMUN and ETMS truncates the data when the flight is passed to the US. Howe ver, to be conservative, we use the114

direct path from MMUN to McAllen to estimate all th e southern routes between DEN and MMUN. Using this route we find that flights th at use the non-radar region route save

133 NM each.

Figure 6. Routes between DEN and MMUN.

Lines are common routes. The dark shaded region is the non-radar region.

Other flights:

Midwest-MMUN: Flights between STL and MSP in April 2003 generally took one of two routes across the non-radar region. The flight s picked up both of these routes near New Orleans. The distance difference was negligibl e. Most flights from ORD and half the flights from DTW also take these paths. The ot her ORD and DTW flights take an

eastern route that coincides with the traffic from the Northeast to MMUN.

IAH-other cities: Nearly all the flights from IAH t o Central or South American cities in the top twenty follow a single path that already ex its at the most direct point available on the Mexican border (fix MARTE).

DFW-MMUN: These flights are already generally dire ct. We could calculate a slight savings of 2.6 NM a flight by sending planes going from DFW to MMUN direct from the end of the departure path from DFW (BILEE fix) to t he exit point on the Mexican border (KEHLI fix) instead of going first to the entry poi nt on the U.S. side of the current non-115

radar area (KLAMS fix). The return flights (also o n A766) were already optimum. This gives a total savings in April 2003 of 354 NM.116 Appendix D Conflict Probe Sensitivity Analysis

The conflict probe benefit area was one of the two benefit areas for which we estimated a range of low and high benefits. There is some amou nt of uncertainty regarding how frequently air traffic controllers act on URET aler ts. As explained above, studies and subject matter expert judgment indicate that air tr affic controllers may not use conflict probe as frequently as originally assumed. In the regulatory evaluation we estimated results assuming controllers act on 10% of the URET conflict probe alerts for the low benefit estimate and 63% for the high benefit estim ate.

In this section we estimate net benefits for 4 diff erent controller act on rates: 63%, 30%, 10% and 2% holding all other variables constant. The highlighted lines show results from the regulatory evaluation. The conclusion tha t we draw is that the act-on rate does not have much of an impact on the final conclusions . Regardless of the rate that controllers act on conflict alerts, given our assum ptions, if all other benefits are high and costs are low, the rule will be cost beneficial. I f all other benefits are low and costs are high the rule will not be beneficial at any of the act-on rates considered when the results

are discounted.117 Appendix E A Timeline of ADS-B Out Costs and Benefi ts

Timeline of ADS-B Out Costs (millions of undiscount ed 2009 $)

Notes: Avionics costs include equipment acquisition , installation costs, fuel burn, mean time between failure and mean time to repair.118 Timeline of ADS-B Out Benefits (millions of undisco unted 2009 $)