• This page contains information for current and prospective investors in Heathrow and Gatwick, the two airports in the UK subject to the CAA’s economic regulation.  We aim to maintain a continuous communication with investors, analysts, investment and corporate bankers, credit rating agencies and any other interested investor market participants.

    Please subscribe to the CAA SkyWise distribution list here and select “Economic regulation and enforcement” to receive updates on our publications.  You are welcome to contact Dan Rock or Maggie Kwok at economicregulation@caa.co.uk

    Heathrow Airport

    We are currently developing the regulatory framework for Heathrow (H7).  Information that investors will find useful are listed below, and a complete set of documents relating to the current Heathrow price control review is available on the H7 page.

    • CAP1762 - working paper on the cost of capital: the implications of the RP3 draft performance plan for Heathrow Airport Limited (HAL) (February 2019)
    • CAP1722, Economic regulation of capacity expansion at Heathrow: policy update and consultation (October 2018)
    • CAP1722b, A critique of published reports regarding scarcity rents at Heathrow Airport, FTI Consulting (October 2018)
    • Technical information note on the CAA's approach to dealing with licensing issues raised by potential alternative developers of new capacity at Heathrow Airport (August 2018)
    • CAP1674, Economic regulation of capacity expansion at Heathrow: working paper on the cost of capital and incentives (May 2018)
    • CAP1658, Economic regulation of capacity expansion at Heathrow: policy update and consultation (April 2018)
    • CAP1610, Economic regulation of capacity expansion at Heathrow: policy update and consultation (December 2017)
    • CAP1541, Consultation on core elements of the regulatory framework to support capacity expansion at Heathrow (June 2017)
    • CAP1513, Recovery of costs associated with obtaining planning permission for a new northwest runway at Heathrow Airport (February 2017)
    • CAP1510, Economic regulation of the new runway at Heathrow Airport: consultation on CAA priorities and timetable  (January 2017)

    We are making available the regulatory financial model (RFM) that we used to produce the analysis on financeability and affordability presented in CAP 1658. Since the model is in a file format that is not currently compatible with this website the model will be distributed to individuals on request via our file sharing site. If you would like access to the model, please contact Dan Rock (dan.rock@caa.co.uk) or Maggie Kwok (Maggie.kwok@caa.co.uk).

    We intend to continue to use the RFM for assessment of financeability and affordability through the H7 process. We are publishing the RFM to provide transparency around the process and to facilitate consultation on the detail of our modelling approach. The RFM will be further developed as we proceed towards setting the H7 price control and we expect that in that time there may be changes to some of the assumptions as we develop our financeability policy. We invite comment and discussion of our modelling approach to help us to refine the RFM.

    We have also published an associated user guide which describes how to operate the model.

    The sources used to populate the RFM with data are described in CAP 1658. In summary, base case capital expenditure data was provided by Heathrow and other data are assumptions developed by the CAA in consultation with Heathrow and the airlines.

    We are separately developing a model that will be used for the interim price control known as iH7. The RFM models the years of the iH7 period so that, once the iH7 control is set, the RFM can reflect an appropriate opening position at the beginning of H7. The RFM will not be used for setting the iH7 price control.

    Questions relating to the model or requests for meetings to discuss detailed modelling points should be addressed to Dan Rock or Maggie Kwok at economicregulation@caa.co.uk

  • Gatwick Airport

    We have conducted an mid-term review on the current price control Q6 and an initial consultation on the next price control G7.  Relevant information is available on the Gatwick licensing page.