London needs another runway by 2030 to cope with increasing air traffic demands, but its ultimate location will be shaped by the changing trends of air travel.

That is the crux of the decision facing the U.K.'s Airports Commission, which short-listed the city's two main airports, Gatwick and Heathrow, as the potential locations for a new runway in the interim report published Dec. 17.

The announcement is causing political tremors, as the current coalition government that ruled out a third runway at Heathrow in 2010 may be forced to tackle the issue if it regains power in 2015.

As the city's main gateway, Heathrow has long campaigned for a third runway to take pressure off its already highly constrained two-runway operation. But Gatwick, the busiest single-runway airport in the world, has rapidly become London's main low-fare gateway. It has been quickly developing its long-haul point-to-point operations and soon will play host to its first long-haul low-fare operations, which could draw airlines away from Heathrow in the future.

“Gatwick and Heathrow don't agree on much,” said Howard Davies, chair of the Airports Commission, at the launch of the report. “The one thing they do agree on is that they won't be building runways at the same time.”

Davies noted that “the optimal approach is to continue to invest in an airport system that caters for a range of airline business models . . . where airlines can choose how to use the available capacity and the market can be expected to respond dynamically to the provision of new infrastructure.”

The changes in market dynamics could prompt construction of a second runway at Gatwick first and a third at Heathrow later. The commission forecasts a need for a yet another runway in southeast England by 2050.

Despite calls for a hub airport, the commission increasingly questions the need for a major four-runway hub airport, such as those at Paris's Charles de Gaulle Airport and Frankfurt Airport. It has frozen virtually all studies of new-build airports around London and the Thames Estuary. Models used by the commission point to significant growth across many of the key market sectors, such as business and leisure travel. However, U.K. and international transfer passengers look set to decline by 2050, when capacity will be constrained by what the commission describes as the “carbon-traded and carbon-capped scenarios.”

Thames Estuary airports, long promoted by former London Mayor Boris Johnson to diminish aircraft noise over the city, are seen by the commission as “imaginative” but having serious “cost, deliverability and environmental challenges,” and resulting in significant economic and social disruption. Such airports would require substantial surface access infrastructure, the considerable cost of which would likely have to come from the public purse.

The commission prices what it considers the most viable of the Thames Estuary options, a four-runway airport on the Isle of Grain, at £112 billion ($183 billion). While it will assess the option's credibility, the challenges and costs of such a project—and the fact that any Thames Estuary airport would require closure of both Heathrow and London City Airport because of airspace complexities—weigh against it.

Instead, the commission has settled on three options it deems most worthy of consideration: two at Heathrow and one at Gatwick. The Gatwick option includes a runway built on land south of the current one with sufficient distance between the two—around 1,000 meters (3,280 ft.)—to permit independent operation of both. The commission points out that the airport has good public transport links; the runway would be on land safeguarded for airport expansion and require demolition of only 200 homes; and, given its rural location, it would have environmental impacts on fewer people.

One of the two Heathrow options is a proposal offered by airport operator Heathrow Airport Ltd. This envisages a third runway and taxiways northwest of the airport, built on top of the M25 motorway, and the elimination of the villages of Harmondsworth and Colnbrook and the British Airways headquarters site of Waterside. The proposal also includes construction of a sixth terminal and satellite buildings.

The independent organization Heathrow Hub offers another alternative that would extend the airport's two runways westward, lengthening them to 6,000 meters and then separating them at the 3,000-meter point to enable them to operate independently as two separate runways. The commission is exploring whether the option would work by extending only Heathrow's northern runway in the same manner, thereby increasing movements by 190,000 per annum, compared to 260,000 per year for the northwest runway option.

The commission says further work is needed to develop a safety case for the Heathrow Hub extension idea, which has not been tried elsewhere. An independent assessment of the proposal by aviation consultancy Helios states that it “has the potential to be safe, but that further analysis and evidence would be required to prove this in detail.”

Heathrow's owners said last summer that any of the third-runway options it presented could deliver new capacity by 2025-29 for £17 billion, less than quarter of the expected cost of a new airport. However, a new runway southwest of the airport would be built into part of a nearby reservoir that provides drinking water to West London. Davies notes that while new reservoirs are commissioned as often as new international airports, feasibility studies carried out with water companies suggest that a reservoir to replace the lost capability would have to be built before a new runway could be constructed.

Plans for a second runway at Stansted Airport were also not short-listed, though the report calls a second runway at the airport in the 2040s a “plausible option.”

The commission concludes that new runways are the only real answer to the capacity issue in the long term. Some relief may be found in the near future by using enhanced air traffic control measures such as en-route traffic management systems, performance-based navigation and trials to smooth the early-morning-arrival schedules at Heathrow to reduce delays and give local communities more predictable respite from noise and pollution. The report also urges airport surface-access improvements, including rail links, which have secured funding in a multibillion-pound infrastructure spending program announced in early December.

The commission says a congestion charge to airports and airlines, intervening in the market or devolving powers to adjust the Air Passenger Duty (APD) would simply encourage airlines to duplicate services at Heathrow. Such moves have, however, prompted changes in the U.K., such as in Northern Ireland, where the APD on long-haul flights was effectively eliminated.

The commission will firm up studies and development work to prepare for the final report, to be delivered in 2015 after the next general election. Editor's Note: This article was updated after the Dec. 23 issue of AW&ST was printed.