LONDON (Reuters) – Britain has underestimated the cost of expanding its airport capacity, a government commission said on Tuesday, with plans to build new runways at either London’s Heathrow or Gatwick costing significantly more than forecast.
Lawmakers and business leaders agree Britain needs new runways to remain economically competitive but the idea of building extra capacity in London is unpopular with many voters and a decision has been delayed repeatedly.
The Airports Commission, which was set up by the government two years ago, has been considering three options of a third runway at Heathrow, an extension to an existing Heathrow runway or a second runway at Gatwick.
A plan to expand Heathrow could cost between three billion pounds and four billion pounds ($4.76 billion – $6.34 billion) more than expected, it said on Tuesday. A second runway at Gatwick airport would also cost two billion pounds more than forecast, it said.
The Commission said the higher costs at Heathrow would put the project at the highest end of the range of financing for infrastructure projects in Britain and said this might push up passenger charges.
The Commission, which noted that expansion at Heathrow could also result in wider economic benefits, is tasked with making its final proposals on how and where to expand airport capacity by the summer of 2015.