1. CENTER FOR AIR TRANSPORTATION SYSTEMS RESEARCH A Transparent and Economically Efficient Process for Determining Planned Airport Capacities Phil Railsback Center for Air Transportation Systems Research George Mason University

2. CATSR Why Determine Planned Capacities? Delays Are a Function of Planned (Scheduled) Airport Capacity Economic Cost of Reliability to Passengers Airlines Recognizing Property Rights of Slots to Holders Slots Can Be A Scarce Resource Codification of Rights Helps Establish Value Slots Being Claimed as Financial Assets

3. CATSR Choosing a Planned Capacity “Planned” v. “Scheduled” Planned Capacity Must Include Scheduled Operations (Airlines) Unscheduled (“Pop-Up”) Airline Operations General Aviation Operations (US Part 135 and 91) Unscheduled Operations Must be Taken Into Account in Policy and Planning

4. CATSR Definitions Time Period Slots Are Considered Fungible Within a Time Period Airport State Open v. Closed, IMC v VMC, Runways in Use Planned Capacity Policy-Established Upper Bound on Operations Realized Capacity Actual Maximum Number of Operations Possible in a Specific Time Period on Day of Operations

5. CATSR Definitions (continued) Slot Availability Probability of a Planned Slot Being Realized on Day and Time of Operations Slot Failure Event Where a Planned Slot is Not Realized Priority Class Sub-grouping of Slots Within a Time Period to Support Multiple Slot Priorities

6. CATSR Randomness and Capacity Capacity is a Function of Random Processes Weather Inter-Arrival Rate Randomness Departure-Arrival Interference Fleet Mix Dependence (Wake Vortex) Therefore Capacity is a Random Process Capacity is Properly Described as a Probability Density Function (PDF)

7. CATSR Airport State Identification {Closed, IMC, VMC} X {Runway Configurations} e.g. IMC using 22/13 (Arrival/Departure) VMC using 13/13 etc. Randomness Leads to a Capacity Distribution by State Can be Determined by Analysis or Empirical Measurement Inter-Arrival Randomness, Arrival-Departure Interference, Fleet Mix Variation Each State Has a Probability of Occurring State Frequencies are Empirically Measurable

8. CATSR Airport Capacity Airport States Form a Partitioning Each State Has a Capacity Distribution Probability of a Realized Capacity (RC) is (by Law of Total Probability)

9. CATSR Example: LGA State-Specific Capacity PDFs Based on Historical Data by State Selected only Time Periods When Operating at Capacity Shows Very Little Weather Dependence

10. CATSR Planned Capacity and Slot Availability There is a Relationship Between Planned Capacity and the Realized Capacity Distribution The Relationship Results in Slot Availability (%) Expected Number of Unplanned Slots

11. CATSR Derivation of Slot Availability Partition By Possible Realized Capacities Each Combination of Realized Capacity (RC) and Planned Capacity (PC): RC >= PC, p is 1 RC < PC, p is RC / PC Slot Availability:

12. CATSR Unplanned Slots Reducing Planned Capacity Increases System Reliability at Cost of Reduced Utilization U(PC): Expected Number of Unplanned Slots e.g.: 9 Planned Slots, 12 Realized Slots 3 Unplanned Slots – Opportunity Cost The Expected Value is:

13. CATSR Example: LGA

14. CATSR

15. CATSR Economic Efficiency What is the Most Efficient Planned Capacity? Maintain System Reliability v. Maximize Throughput We Need Slot Valuation as a Function of Slot Availability Then Maximize Summed Slot Valuation: e.g.: 5 Slots at 98% valued at 900 € each 10 Slots at 85% valued at 400 € each 4500 € > 4000 € → Plan 5 Slots

16. CATSR Auctions Can Provide Valuation Auctions Provide Value Discovery Across Multiple Operators We Can Integrate Desired Availability into a Slot Auction Auction Availability/Priority Classes, or Have Bidders Specify Desired Availability in Their Packages –Might be Prone to Auction Gaming Necessary Condition for Operators’ Product Differentiation by On-Time Performance

17. CATSR LGA Example: Priority 2 Slots Compare: 5 Priority 1 Slots, 98% Availability and (from previous plot) 5 Priority 2 Slots, 71% Availability; or (from this plot) 10 Priority 1 Slots, 84% (from previous plot)

18. CATSR Conclusions Provides Simple, Transparent Relationship Between Availability and Planned Capacities Shows How Market Mechanisms (Auctions) Can Provide Answer to Trading Off Throughput and Reliability Data Are Critical to Results Insights Into Airport Behavior

19. CATSR Questions Phil Railsback George Mason University prailsba@gmu.edu