UK regulator proposes allowing Heathrow Airport to recoup $433 million in expansion costs

UK’s aviation regulator on Monday proposed allowing Heathrow Airport to recover up to 320 million pounds ($433 ​million) in early costs related to expansion work, as the UK’s biggest ​airport pushes forward with plans to add capacity.

The proposal comes as ⁠UK seeks to boost aviation infrastructure and address long-standing capacity constraints at ​Europe’s busiest airport, while ensuring consumer protections remain in place during the costly ​planning phase.

The Civil Aviation Authority said the plan to allow Heathrow Airport to recoup costs incurred during 2025 and 2026 would help it to fund the planning and design work ​for its expansion.

Heathrow is working towards submitting an application to build a new ​northwest runway by 2029, a plan backed by the UK government.

“Our view remains that a regulatory ‌framework ⁠allowing the recovery of efficiently incurred early costs in 2025 and 2026 is essential to support timely delivery of expansion and the earlier realisation of consumer benefits,” the watchdog said in its draft proposal.

Heathrow Airport last week forecast an uncertain ​few months as capacity ​constraints crimp its ⁠ability to benefit from a shift in global aviation patterns resulting from the Iran war, with the west London ​hub saying its growth lagged European competitors as its runway ​slots remain ⁠full.

Heathrow CEO Thomas Woldbye in February warned that the airport would be overtaken by Istanbul as Europe’s busiest airport this year or next, as its two runways compete ⁠with ​Istanbul’s five.

Responses to the CAA consultation are due ​by May 18, with a final decision expected in July, the regulator said.