Sustainability Performance Review 2010

Sustainability Performance Review 2010 Date of issue: 31-08-2011 (including the verified Annual Monitoring Report of the obligations and commitments contained within the 2008 S106 Legal Agreement) 1

1. WELCOME TO THE NEW GATWICK We're a major independent airport, competing to become London's airport of choice. We have ambitious plans and the freedom to pursue what s best for our passengers, airlines, employees and community. We re putting the passenger at the centre of our plans. Everything we do is designed to make their journey faster, easier and more rewarding. We're working hard to understand what they want and to deliver a better experience at every step of their journey. Our credentials to transform Gatwick into a great airport are grounded in years of working closely with airlines, business partners and communities. It's about listening, sharing ideas and delivering long-term benefits that will make Gatwick the first choice for airlines. We can t knock Gatwick down to build a brand new facility. But we can and are modernising the airport with a 1 billion investment programme that will deliver better operations and improved service. And we are doing it in the most efficient, and sustainable way. Over the next few years, Gatwick will change beyond all recognition. We re changing the way we look at the world, and the world is beginning to see us differently too. Stewart Wingate CEO ABOUT THIS REPORT In 2011 we have built upon the approach we adopted last year. Again we have published two reports our 2011 Decade of Change report provides information across all issues in a straightforward and accessible way. This makes sure that all stakeholders can access the information they require simply and efficiently. Secondly, within this report we detail progress against our S106 Legal Agreement and provide additional data that was not included within the Decade of Change document. 2

Contents 1. Welcome & About the report 2 2. A responsible approach 4 3. Our key priorities 4 4. Verification of our performance 5 5. S106 Legal Agreement governance process 8 6. Sustainability performance summary 9 7. S106 Legal Agreement progress report 10 8. Climate change 10 9. Managing air quality 13 10. Managing our noise impacts 22 11. Surface access 31 12. Land use, development & biodiversity 46 13. Community & economy 49 14. Water quality & drainage 55 15. Waste management 60 16. Utility management 64 17. Appendices 66 17.1. Crawley Borough Council & West Sussex County Council S106 performance 66 17.2. SKM Enviros verification statement and summary 74 17.3. GAL action plan performance 82 3

2. A RESPONSIBLE APPROACH Our abmition is to compete to grow and become London s airport of choice. Operating a responsible Gatwick means striking the right balance between the environmental impacts and the social and economic benefits of the airport while offering our passengers a great service. With operational efficiencies come environmental efficiencies, so the better we manage our facilities, the smaller our environmental footprint will become. We will only achieve our targets by working closely with our stakeholders and business partners to deliver joint work programmes. This means that the people we work with, the companies we engage with and the passengers travelling through Gatwick all have a part to play. It s not simply about improving our environmental performance it s about modernising the airport in the most sustainable way that will enable us to achieve our targets. It s also about making sure that during this period of development the benefits to the economy and to our local community are maximised. 3. OUR KEY PRIORITIES Our Decade of Change strategy supports Gatwick s key priorities, Competing to grow to become London s airport of choice Help our airlines grow Deliver the best passenger experience Increase value and efficiency Protect and enhance our reputation Build a strong environment, health and safety culture Develop the best people, processes and technology leading by example through sustained responsible growth responsible growth will help ensure the long term prosperity of Gatwick encouraging our passengers to support our goals will improve their airport experience recognising the environmental impacts of improved operational efficiencies receiving recognition for what we do ensuring the health and well-being of our employees, our passengers and our environment being a responsible organisation with people development at its heart 4

4. VEIFICATION OF OUR PERFOMANCE Our performance against our S106 Legal Agreement This report fulfils our obligation to publish an annual monitoring report detailing performance against the obligations and commitments detailed in the S106 Legal Agreement. In line with the Legal Agreement a selection have been subject to independent verification. Background In December 2008 we signed a new S106 Legal Agreement with West Sussex County Council (WSCC) and Crawley Borough Council (CBC). This contained a number of obligations and commitments for Gatwick to deliver against that supports our vision of developing a sustainable airport. The revised Legal Agreement replaced the original version signed back in 2001. A number of commitments are also placed on both WSCC and CBC. As a way of strengthening our commitment we published supporting action plans detailing our delivery programme through to 2011 for air quality and noise (interim action plan), and individual action plans for the management of waste, water and utilities. These were further supplemented by the publication of a surface access action plan in December 2009. In 2011 we are required to renew the action plans for waste, water, utilities and air quality. However, under the Decade of Change banner we will go beyond this and publish actions plans covering these issues along with community, local economy, biodiversity and carbon. We will also produce summary action plans covering both noise and surface access (these actions will come directly from the existing END noise action plan and surface access action plan). These action plans will align the obligations within the S106 Legal agreement with the strategic direction provided by Decade of Change, as a result the current set of sustainable development commitments and S106 action plan actions will be replaced. 5

Growing in partnership WSCC and CBC are the key partners in this Agreement and represent a wider Joint Local Authorities (JLA) management group that includes Horsham District Council, Mid Sussex District Council, Reigate & Banstead Borough Council (RBBC), Mole Valley District Council, Tandridge District Council and East Sussex District Council. We work closely with WSCC and CBC on progressing the activities specified within the Agreement and report progress through a quarterly steering group. WSCC and CBC then review our progress with the wider JLA membership at both councillor and officer level. Air quality issues are managed through a separate quarterly steering group with RBBC, who take the lead on these issues on behalf of the other local authorities. The 2008 Legal Agreement represents a long history of working closely with our local authority partners. We published our Sustainable Development Strategy (SDS) for Gatwick in 2000 which included a number of commitments relating to environmental management. This document was then built upon in 2001, when the first Legal Agreement was signed with WSCC and CBC, and contained over 140 commitments and obligations. Over the next 7 years we continued to deliver against these issues and report our performance annually. During this time some of the commitments and obligations expired and as a result we began negotiating a revised legal agreement in 2007. To facilitate this process a revised list of 50 commitments were agreed in December 2007 which ran alongside the remaining obligations until the publication of the new Legal Agreement in December 2008. This report details performance against all commitments and obligations a selection of which will have been subject to external verification, the findings of which will be included. The table below explains how we will detail performance against the commitments and obligations, and the outcome of the independent verification process. Within the report we will also summarise performance against the actions contained within the respective issue focussed action plans. Issue Status Comment on 2010 Action plan for 2011 The detail of the obligation or commitment is listed here How we rated this through our internal audit process A summary of actions undertake in 2010 Bullet points outlining our plans for 2011 Verification findings This section details the findings of the audit process Verification recommendations, including GAL response This section will detail any recommendations made by the auditor where they feel improvements can be made, or where amendments to our statement is required. Our response to these points will also be included. 6

Overall approach and methodology The table below summarises the verification methodology that has been adopted by the auditor. Step 1 : Step 2: Step 3: Step 4: Step 5: Report Review and selection of commitments for audit SKM Enviros reviewed the draft Annual Monitoring Report to select the 12 obligations/commitments for audit. The selection process considered the requirements of the legal agreement, the principles of the AA1000 Accountability Principles Standards (2008), the Global Reporting Initiative, which commitments have not been audited recently, areas which required action by 31 st December 2010 and results of previous audits. Client meeting SKM Enviros met with GAL, WSCC, and CBC to initiate the project and discuss the selection of commitments for audit. Conduct interviews with issue owners SKM Enviros interviewed the commitment owners at GAL, WSCC and CBC to review the data quality and statements made, to assure that the data collection process is robust, to review data transposition/manipulation and to check internal assurance and audit processes. Review supplementary information SKM Enviros reviewed information relevant to evaluating the performance information during the interviews. Supplementary information was also received and reviewed following the interviews. Draft Verification Report Following the interviews SKM Enviros produced a draft Verification Report which includes the Verification Statement, agreed changes, general feedback on the audit process, our specific findings and recommendation in relation to each of the 12 selected commitments/obligations. Step 7 Review report with Gatwick, WSCC and CBC The draft verification report and statement was discussed at a meeting with GAL, WSCC and CBC. Following the meeting the verification report was finalised incorporating any issues arising from the meeting. 7

For consistency with previous Annual Monitoring Report verification, the rating method used is as follows; This obligation/commitment is on track This obligation/commitment is neither on track or behind schedule. This obligation/commitment is not on track. 5. S106 LEGAL AGREEMENT GOVERNANCE PROCESS Externally our commitment to sustainable development is set out in our S106 Legal Agreement, signed in partnership with Crawley Borough Council (CBC) and West Sussex County Council (WSCC) in 2008. This document outlines our approach to growing to handle 40 million passengers a year sustainably. Performance against this agreement is governed and communicated through our S106 Steering Group, attended by both CBC and WSCC, and to our consultative committee, GATCOM. Internally, we track performance against the actions contained within the S106 Legal Agreement on a quarterly basis the outcome of which is reviewed at our Managing Corporate Responsibility meeting, chaired by our CEO. The results of this process are then used to formulate the report that we share with the S106 Steering Group. 8

6. SUSTAINABILITY PERFORMANCE SUMMARY The following table summarises key environmental performance indicators Issue 2008 2009 2010 %change Data source 2009 / 10 Carbon scope 1 (tco2eq) 14,317 12,451 16,499 +32.5 RSK Carbon scope 2 (tco2eq) 87,592 87,237 79,106-9.3 RSK Carbon scope 3 (tco2eq) 724,990 633,510 625,897-1.2 RSK Total carbon emissions (tco2eq) 827,259 733,198 721,502-1.6 RSK Air quality nitrogen dioxide (NO2) 36 34 37 +8.7 GAL Air quality PM10 26 21 22 +1.4 GAL Noise track keeping (%) 97.5 96.8 97 +0.2 GAL Noise total noise infringements 4 1 0-100 GAL Noise daytime noise infringements 2 0 0 n/a GAL Noise night-time noise infringements 2 1 0-100 GAL CDA compliance (%) 84 88 89.7 +1.7 GAL Total waste (t) 12,297 10,177 9,685-4.8 GAL Waste recycled (%) 26.6 39 41 +2 GAL Waste per pax (kg) 0.36 0.31 0.31 n/a GAL Water consumption (l) 1,058,000 1,059,141 956,539-9.9 GAL Electricity consumption (kwh) 163,477,226 159,578,773 162,621,805 +1.9 GAL Gas consumption (kwh) 67,493,119 54,246,416 75,333,903 +38.9 GAL Passenger public transport use (%) 36.3% 37.2% 40.4 +3.2 CAA 9

7. S106 LEGAL AGREEMENT PROGRESS REPORT Performance against S106 Over the following pages we detail our performance against the obligations and commitments included within the S106 Legal agreement at 31 st December 2010. The following issues are covered Climate Change, Air Quality, Noise, Surface access, Land use, development & biodiversity, Community & the economy, Water quality & drainage, Waste management and Utility management. 8. CLIMATE CHANGE Performance against S106 There are three Climate Change obligations included in the 2008 Legal Agreement. Issue Status Comment on 2010 Action plan for 2011 Obligation 2.1 - By the 30 th June 2009 prepare and publish a report on the Airport and climate change Gatwick's Climate Change Report was published Summer 2009 In 2011 we will begin to formulate ideas for the production of a new report in 2012. This will include early discussions with key local authority partners over the style and content of the report. Obligation 2.2 thereafter continue an ongoing dialogue on climate change initiatives with local authorities and other key stakeholders A strong climate change engagement programme has been in place at Gatwick for a number of years. From a local authority perspective this is led through the S106 Steering Group meetings held quarterly with CBC and WSCC. Further meetings are held with the CBC and WSCC Climate Change teams, which has To maintain our strong approach to climate change engagement with local business partners and regional and national stakeholders. In 2011 consider widening our engagement programme to raise Gatwick's profile with non-aviation organisations. Locally we will continue to engage with 10

Issue Status Comment on 2010 Action plan for 2011 resulted in Gatwick being represented on WSCC Climate Change Board. A wider sustainability engagement programme has been developed as part of the Decade of Change of change roll-out. This includes industry bodies such as Sustainable Aviation, and locally with key Gatwick business partners culminating in the establishment of the 'Airline Sustainability Group' in 2011.Groups). Further direct sessions with WSCC and CBC and other local authorities on issues relating to climate change. These included discussions at a range of levels - from Chief Exec through to officer level. A wider engagement programme with industry leaders, business partners and other organisations was implemented during 2009. our business partners on-airport to develop joint work plans that deliver against our Decade of Change sustainability strategy. Obligation 2.3 - Update the report not less frequently than every 3 years We plan to publish an updated report in 2012 as per the obligation. In 2011 we will begin to formulate a plan for production of a new report in 2012. This will include early discussions with key local authority partners over the style and content of the report. 11

Additional climate change performance data Metric 2008 2009 2010 Scope 1 - direct emissions from GAL operations i.e. gas consumption and petrol/diesel in company owned vehicles (t CO 2 ) Scope 2 - indirect emissions from consumption of electricity either within our own assets or within tenanted facilities (t CO 2 ) Scope 3 - emissions from aircraft movements, passenger and staff travel to the airport, airside activities, waste disposal, etc (t CO 2 ) 14,317 12,451 16,499 87,952 87,237 79,106 724,990 633,510 625,897 Total 827,259 733,198 721,502 Passengers 34,184,781 32,376,311 31,348,998 Air Transport Movements 263,716 251,791 233,652 12

9. MANAGING AIR QUALITY Our performance against S106 The table below details our performance against the air quality obligations and commitments included in the 2008 Legal Agreement. Issue Status Comment on 2010 Action plan for 2011 Obligation 3.1.1 - To provide a Fixed Electrical Ground Power supply to any new Aircraft Stand This is advocated by the Airfield Operations team and is therefore a requirement for any new aircraft stand. The standard specification for aircraft stands at Gatwick will include FEGP. 2010 saw the development of 6 new stands in the airport North West Zone all of which included Fixed Electrical Ground Power (FEGP). Obligation 3.1.2 - Not allow the use of Ground Power Units at any Aircraft Stand unless: there is no Fixed Electrical Ground Power installed at the Aircraft Stand; the Fixed Electrical Ground Power which has been installed at the Aircraft Stand is temporarily out of service; or the relevant aircraft is incapable of utilising Fixed Electrical Ground Power by reason of its design or a technical malfunction or the power so supplied is insufficient for the aircraft. 3.1.2 - Prior approval is required before any operator can use Ground Power Units - these requests are monitored by Airfield Operations and included in their quarterly report. 2011 will see the publication of a revised Airport Directive which sets out regulations around the use of Ground Power Unit operations. 3.1.2 - Maintain the approach indicated within the revised Directive. In 2011 we will look at introducing GPU audits 3 times a month. Verification findings This obligation is on track The reported progress in 2010 is correct. It is a standard procedure for Fixed Electrical Ground Power (FEGP) to be fitted to new aircraft stands at GAL. 13

Issue Status Comment on 2010 Action plan for 2011 GAL has processes and tools in place to ensure that sustainability is embedded across their capital investment programme. A sustainability screening assessment (SA1) is undertaken on all major projects to ensure that through the project brief, the team considers the impacts of the project. If the brief and design doesn t comply with SA1 criteria, which includes specifying FEGP to all new aircraft stands, the stand design won t be signed off. In 2010, 6 new aircraft stands were built in the North West Zone of the airport, all of which were fitted with FEGP. GAL s Managing Directors Instruction (MDI) Use of Ground Power Units on Aircraft Stands ref: MDI/A14/09 controls the use of Ground Power Unit s (GPUs) on aircraft stands. The MDI states that prior permission for the use of a GPU must be requested from Airfield Operations, who will for audit purposes record the date, time, location, and reason for the GPU being used. As part of the APU compliance audits that are undertaken 3 times per month, where GPU usage was observed, the auditor checked whether the use of GPU had been granted. However, this element of the audit was not formally recorded. GAL produces a quarterly report for the Ground Noise Committee that records the number of GPU s used and dispensations given. The Managing Directors Instruction Limitations on the Use of Aircraft Auxiliary Power Unit Ref Number MDI/A03/08 purpose is to reduce aircraft related noise and emissions by limiting the use of Auxiliary Power Unit (APU) under certain conditions on arrival and departure. Monitoring takes place 3 times a month to ensure that operators are compiling with the MDI. The following information is recorded during the APU audit and subsequently reported through GAL Ground Noise Committee quarterly report: Number of aircraft running APU s which were compliant Number which were non-compliant Number of aircraft parked but not running APU s Total number of aircraft on the airfield In 2010, the audit highlighted that in 2010 there were 11 APU s running that were non-compliant. GAL s MDI s relating to GPU s and APU s are communicated to airlines through the UK Aeronautical Information Plan (AIP) for London Gatwick. GAL also engages with the Flight Operations Performance Committee (FLOPC) raising and providing feedback to Airlines on audit findings. In addition during 2010, GAL gained feedback from airlines regarding their APU standard operating procedures. The level of progress has been satisfactory to meet the obligation. 14

Issue Status Comment on 2010 Action plan for 2011 Verification recommendations, including GAL response It is recommended that GAL formally undertake GPU audits 3 times per month. It was noted that this has already been identified as an action for 2011. GAL RESPONSE GAL agrees with the auditors comments Obligation 3.2 - To undertake the Company s fire training exercises in a manner that uses a greater quantity of liquid petroleum gas than kerosene and use reasonable endeavours to undertake as few fire training exercises using kerosene as possible. The Fire Service only burns propane gas on the fireground for all training activities. Kerosene was removed from the site and any training burn about two years ago. Gatwick s 'Train the Trainer' fire awareness course for stakeholders uses a small amount of diesel or accelerant for extinguisher training no more than six times a year. To continue using only a limited amount of kerosene during fire training exercises The Company will continue to track the Airport s air quality impact through the use of continuous monitoring at site LGW3 and ad-hoc monitoring of carbon monoxide, PM10, NOx, NO2, and grab samples of benzene, 1,3 butadiene and other hydrocarbons. This is a business as usual activity and these KPI's are reported annually through the sustainability performance review published in August. We will report this performance data through our sustainability performance review document to be published in August. The Company will monitor and report on the procedural requirements of the Airport that are aimed at mitigating air quality impacts of airport activities. (This will include compliance with MDIs which will help manage air quality.) A range of airport directives instruct business partners on the operational requirements of the airport - Airside Operations monitor and report on compliance against these. A key example of this is the 60 vehicle checks undertaken every month - if a vehicle's emissions are found to be too high a non- We will continue to maintain our current approach and in 2011 will progress our work on A-CDM, and supplement this further by exploring the opportunities that CEM could provide to the airport. 15

Issue Status Comment on 2010 Action plan for 2011 compliance notification is issued. Further initiatives have been developed that look to improve the operational procedures to provide environmental benefits - such as A-CDM (Airport Collaborative Decision Making), CEM (Collaborative Environmental Management) and single engine taxiing and these will continue to be developed in partnership with our airlines and business partners. The Company will work with its business partners and others to manage on-airport emissions and drive compliance with all relevant air quality legislation. PM2.5:attributable. This is a business as usual activity managed by our Airside Operations team. We manage and attend a series of working groups that bring together engine manufacturers, airlines, etc. We will continue to work with our partners to maintain compliance with all relevant legislation. Obligation 3.3 - To participate actively with the County Council, the Borough Council and the adjoining authorities: to avoid breaching the EU Limit value for NO2; to ensure that all other relevant air quality standards continue to be met; and to develop and implement any Local Air Quality Management Area action plan that may be required to address air quality in the vicinity of the Airport where that air quality is materially affected by airport derived emissions including those from airport operations fixed plant and surface access. Gatwick chair the quarterly AQ steering group programmed with RBBC (as part of the wider S106 delivery programme). This group manages a joint programme of research, monitoring and action planning for all issues relating to local air quality, and in particular the AQMA/Horley Gardens area. Latest modelling work for 2015 @ 40 mppa has been changed to 2017/18 @ 40mppa to align with Master Plan. S106 steering Group are happy with this approach. Subject to results of modelling at 40mppa and @45 mppa 2024/25 a reduction in the size of the Horley AQMA will be investigated. 16

Issue Status Comment on 2010 Action plan for 2011 Obligation 3.4 - The Company will, during the period of this Agreement, provide Reigate & Banstead with the following financial support for their activities relating to air quality in the vicinity of the Airport: A payment of 65,000 on or before 30 April in each calendar year 2009 to 2015 inclusive Purchasing in accordance with a specification and programme set by Reigate & Banstead and thereafter leasing to Reigate & Banstead at a nominal cost (say 1 per site per year) such equipment as is needed to be replaced in order to maintain the current programme of air quality monitoring on three permanent sites. The cost and periodic replacement of the existing equipment is anticipated as: 46,000 in 2010 for site RG1 21,000 in 2010 for site RG2 40,000 in 2015 for site RG3 The Company will also arrange twice-yearly meetings; the first to be held in January 2009 with Reigate & Banstead to discuss progress with air quality monitoring the results thereof and any further initiatives that may be deemed appropriate as well as the Company s progress with implementing its Air Quality Action Plan. Gatwick have made payments to RBBC in accordance with the obligation. Meeting programme in place (quarterly AQ steering group sessions established with RBBC). Financial contributions to RBBC will continue in line with the detail in the S106 agreement. This year that equates to just the 65,000 annual payment. Obligation 3.5 - The Company will undertake a programme of studies of NOX/NO2, PM10 and PM2.5: attributable to activity at the Airport as detailed in the Air Quality Action Plan. The emission inventory and dispersion modelling for 2015 was completed in 2010. In 2011 we will review the predicted emission inventory for 2010 against actual emission data for 2010. 17

Issue Status Comment on 2010 Action plan for 2011 The Company s approach and priorities in mitigating and managing the Airport s air quality impacts will be described in an Air Quality Action Plan, produced and reviewed in accordance with Action Planning Obligations and informed by information obtained, and progress, in preceding years. The Company s annual monitoring report will review the delivery of the action plan and other air quality management activities, including collaborative work with other parties. COMPLETE - Air Quality action plan published December 2008. This action plan was successfully audited as part of the AMR process in 2009 - all comments/recommendations will be reviewed as part of the action plan revision process programmed for 2011. Publish a new Air Quality action plan by December 2011; Agree approach with LA's - Mar Draft action plan produced for internal review - June Consultation with LA's and stakeholders complete - Sept Publish action plan - Dec The Company s Air Quality Action Plan will include the following studies of NOx/NO2, PM10 and PM2.5:attributable to activity at the Airport: The production of a predictive emissions inventory for 2010 (by 31/12/2008); Atmospheric dispersion modelling for 2010 (by 31/12/2008); The production of a predictive emissions inventory for 2015 (by 31/03/2010); Atmospheric dispersion modelling for 2015 (by 31/12/2010); and The review in 2011 of the predicted emissions inventory for 2010 against actual emissions data for 2010 and, if there are significant differences, an estimate of the likely effect on the accuracy of the modelled air quality for 2010 The first two activities were completed in 2009 Actions 3 and 4 have been completed in 2010. Action 5 will be delivered as programmed in 2011. In 2011 we will review the predicted emission inventory for 2010 against actual emission data for 2010. 18

Issue Status Comment on 2010 Action plan for 2011 will be made using an appropriate method. Verification findings This commitment is on track The stated progress in 2010 is accurate. GAL completed a predictive emissions inventory and atmospheric dispersion modelling for 2010 in June 2009. The S106 agreement required this work to be completed by 31/12/2008, GAL were delayed in delivery of this work due to organisational changes within GAL. The delay of the work was verbally agreed with Reigate and Banstead Borough Council. It is recommended that should there be delays in the delivery of future work, written confirmation should be provided to confirm agreement of the delayed work. GAL completed a predictive emissions inventory for 2015 by March 2011. The S106 agreement required the emissions inventory to be completed by 31/03/2010; the emissions inventory was therefore completed within the required timescales. GAL completed atmospheric dispersion modelling for 2015 by August 2010. The S106 agreement required this modelling to be completed by 31/12/2010; the modelling was therefore completed within the required timescales. GAL provides a summary of the air quality monitoring results to the following parties: Reigate and Banstead Borough Council S106 Steering Group Air Quality Steering Group GAL s Chief Executive The level of progress for 2010 has been satisfactory to meet the obligation. Verification recommendations, including GAL response To ensure the documented Action Plan is delivered within the required timescales, it is recommended that GAL undertake quarterly reviews of the Action Plan. It is recommended that should there be delays in the delivery of future work, written confirmation should be provided to confirm agreement of the delayed work. 19

Issue Status Comment on 2010 Action plan for 2011 GAL RESPONSE GAL agree that future changes to programmed activities would benefit from full documentation across all parties. GAL already undertake a quarterly review of performance against S106 obligations, commitments and relevant actions. Additional performance data Air quality monitoring (source GAL) LGW3 2006 2007 2008 2009 2010 Nitrogen dioxide NO 2 (µg/m 3 ) Particulates PM 10 (µg/m 3 ) Carbon monoxide CO (mg/m 3 ) 36.9 40.0 35.8 34.3 37 22.4 25.0 25.6 20.9 22 0.3 0.5 0.5 0.4 0.8 Air quality at off-airport monitoring sites NO 2 (source GAL) 2007 2008 2009 2010 RG1 (Michael Crescent, Horley, Grid ref. 528206 142333 30.1 27.2 25.3 29.8 RG2 (The Crescent, Horley, Grid ref. 528527 141877 32.8 32.0 30.9 26.8 RG3 (Poles Lane, Lowfield Heath, Grid ref. 526419 139640 20.8 20.9 16.4 21 20

Air Quality Action Plan During 2010 we had 26 active actions within the Air Quality Action Plan their status as of 31 st December 2010 was as follows; Rating Number Green 25 Amber 1 Red 0 21

10. MANAGING OUR NOISE IMPACTS Our performance against S106 Obligations & Commitments The table below details our performance against the noise obligations and commitments included in the 2008 Legal Agreement. Issue Status Comment on 2010 Action plan for 2011 Obligation 4.1 - With the aim of providing a continuing incentive to airline operators to reduce the noise impact of departing aircraft at the Fixed Noise Monitoring Locations and subject to any requirements imposed by the Company s appropriate regulator to give due consideration when preparing and reviewing the Noise Action Plan to the retention and possible increase of the Noise Supplements payable by such operators on account of infringement by their aircraft of noise thresholds on departure. - Review the option to differentiate within chapter 4 between high, base and minus. Currently this only exists within Chapter 3 but as the proportion of Chapter 4 aircraft within Gatwick becomes greater the need to further differentiate and incentivise quieter aircraft should be investigated. This was included as a proposal as part of the 2011/12 airline consultation process. - Review appropriateness of NOx emissions charge as part of the overall tariff structure during 2011 as part of 2012/13 airline consultation process. Discussion with Airlines and the DfT around this are scheduled for this year. A letter was sent to the DfT in December 2010 requesting the opportunity to discuss this issue, a response is still outstanding. Obligation 4.2 - Maintain differentials in the charges on aircraft movements at the Airport, subject to any requirements of the Company s appropriate regulator so as to encourage airlines to use quieter and cleaner aircraft types. Currently airport charging structure differentiates on the basis of both noise and emissions. Chapter differentiation exists for noise whilst the emissions charge is based on NOx ratings. - review the option to differentiate within chapter 4 between high, base and minus. Currently this only exists within Chapter 3 but as the proportion of Chapter 4 aircraft within Gatwick becomes greater the need to further differentiate and incentivise quieter aircraft should be investigated. This 22

Issue Status Comment on 2010 Action plan for 2011 was included as a proposal as part of the 2011/12 airline consultation process. - review appropriateness of NOx emissions charge as part of the overall tariff structure during 2011 as part of 2012/13 airline consultation process Obligation 4.3 - With the aim of managing the impact of air noise and restricting as far as is reasonably practicable the extent of the air noise contours associated with full use of the Airport s runway to engage with airlines NATS and other relevant parties through the Flight Operations Performance Committee and/or by other appropriate means and use all reasonable endeavours to secure the benefits to be derived from existing or future regulations procedures and codes of practice applicable to aircraft in flight. We work with a range of business partners (airlines, engine manufacturers, etc) through groups such as FLOPC, NATMAG, etc, to ensure compliance with relevant procedures. We also liaise with Govt on new and emerging legislation to understand how this impacts operations here at Gatwick. We will maintain our engagement activities to ensure that we continue to drive improvements in the way the airport operates - for example working through our partners at FLOPC to continue to drive up compliance with CDA. Obligation 4.4 - With the aim of mitigating the possible impact of future growth in aircraft engine testing at the Airport: If the annual number of ground run engine tests occurring within any rolling 6 month period reaches 250 and remains at or in excess of that number for six successive months or if such a situation is forecast in consequence of confirmed airline plans to undertake additional aircraft maintenance at the Airport the Company shall within the following nine months undertake and conclude a process of discussion and consultation with the Councils with the objective of: assessing the impact of such testing on local communities; evaluating the feasibility and benefits of alternative means 4.4.1 The current MDI on engine testing defines the regulations and controls that are to be adhered with. Current data on engine testing taking place at Gatwick shows 100% compliance with the MDI. The airfield compliance team also track the number of engine tests being carried out which is then reported through a number of forums - Ground Noise Committee, NATMAG (Noise and Track Monitoring We will maintain our monitoring process and continue to report compliance with the engine testing obligation through airport noise groups and via the S106 Steering Group. 23

Issue Status Comment on 2010 Action plan for 2011 of managing or mitigating any material impact including: - increased restrictions on the times of day when tests would be permitted; - changes to the locations favoured for engine tests; - the construction and operation of a ground run pen; and identifying the preferred means of managing or mitigating any material impact. The Company will subsequently and if reasonably practicable within six months in accordance with a programme to be agreed with the Councils introduce such measures as may be agreed with the Councils as appropriate to manage or mitigate the impact of ground noise arising from engine testing saving that; In the event of the construction of a ground run pen being the agreed means of mitigation the Company will within six months of agreeing the mitigation programme with the Councils seek and following permission implement the planning permission for a ground run pen as soon as is reasonably practicable and thereafter maintain it in use. Group), etc. The report is also circulated at the quarterly S106 Steering Group to monitor compliance with the Obligation. 4.4.2 and 4.4.3 We have a monitoring process in place internally, which is communicated externally through Noise groups and the S106 Steering Group Verification findings This obligation is on track. 4.4.1, 4.4.2 and 4.4.3 The 2010 reported progress is accurate. GAL s Managing Director s Instruction Procedures for Aircraft Engine Testing Ref MDI/A08/09 sets out a policy for ground running of aircraft engines for maintenance purposes. The number of engine tests being carried out at the airport is monitored through the following process: Before airlines undertake an engine test, prior permission has to be sought by GAL s Airside Delivery Leader, who will assess the impact of the potential 24

Issue Status Comment on 2010 Action plan for 2011 noise nuisance generated by the test on the community. The airlines complete this approval process by completing a GAL Aircraft Engine Test Request and Data form. GAL s Airfield Operations team will fax the completed consent form back to the airline confirming approval. Within 2 hours of the completion of the engine test, the airline has to submit information to GAL regarding the engine test. GAL s Airfield Operations team enter the information contained on the GAL Aircraft Engine Test Request and Data form onto a spreadsheet, whereby the number of engine tests is monitored. In 2010, 225 ground run engine tests were undertaken, which is compliant with the S106 agreement. GAL continually monitor the number of ground run engine tests to ensure that within any rolling 6 month period they don t reach at or over 250. Should the number of ground run engine tests occurring reach 250, GAL will undertake dialogue with the Council to agree means of mitigation The Airfield Operations Team undertakes audits three times a month to check that the MDI is being adhered to and the number of ground run engine tests is being accurately recorded. GAL produces a quarterly report for the Ground Noise Committee, whereby the number of aircraft engine tests is communicated. A summary of this report is presented to other stakeholders including: Flight Operations Performance Committee (FLOPC), Noise and Track Monitoring Group (NATMAG) and the S106 Steering Group. The level of progress for 2010 has been satisfactory to meet the obligation. Verification recommendations, including GAL response GAL should consider combining the Noise and Track Monitoring Group and Ground Noise Committee. This will increase the transparency of the communication of noise related issues at Gatwick. GAL currently have no data checking process of the GAL Aircraft Engine Test Request Data form, it is suggested that GAL consider implementing a data checking process in place to ensure the accuracy of reported data. GAL RESPONSE GAL agree with the findings of the auditors. 25

Issue Status Comment on 2010 Action plan for 2011 The company will establish a noise insulation scheme and complete work on all eligible applications by the end of 2013 The current Noise Insulation Scheme is still active and work continues on eligible properties. In 2010 4 properties were progressed. A review of this scheme will be completed this year and any recommendations for improvements or a new scheme will be communicated through the appropriate governance groups. The Company will work with its business partners and local authorities and others to manage noise in a manner which will drive towards compliance of all relevant noise legislation and codes of practice. This activity is delivered through a range of forums including - GATCOM, NATMAG, FLOPC, Ground Noise Committee, etc.. All noise governance groups will continue this year as planned, there will also be a review of these groups with the aim of improving output and driving efficiency. The Company will continue to monitor and report aircraft performance against the requirements of the UK AIP, Night Restrictions and other rules and regulations through the use of permanent and mobile noise monitors, a noise and track monitoring system and other appropriate databases. Track keeping, CDA compliance, noise limits and night flying restrictions continuously monitored during 2010 and reported quarterly to the consultative Committee and NATMAG. Night flying restrictions for Summer and winter 2010 were comfortably within the prescribed limits. Continue to monitor the adherence to the noise mitigation measures and engage with airlines to improve where necessary. The Company will monitor and report on the procedural requirements of the airport that are aimed at mitigating noise impacts of Airport activities. (This will include compliance with Gatwick Airside Operations team monitors compliance with relevant Airport Directives. The output of these ongoing audits is We will continue to maintain our robust approach to monitoring compliance with 26

Issue Status Comment on 2010 Action plan for 2011 MDIs which will help manage noise.) reported and reviewed by a range of forums - including the Ground Noise Committee, etc. Airport Directives, with relevant information being shared The company will conduct and report on five-yearly background noise monitoring of the airport ground noise by the end of 2010 and 2015 This modelling work has been delayed to coincide with the publication of Gatwick's new Masterplan (scheduled for Autumn 2011). This programme of modelling will be published as part of the Airport masterplan. The outcome of this modelling work will also be discussed at the relevant noise forums. The company will produce five-yearly forecast contours to investigate the potential impact of the airport on the surrounding community. Models will be run for 2015 and 2020 by the end of 2010, and 2015 respectively Not applicable in 2009 - programmed for 2010. Deliver against obligation following publication of END Noise Action Plan - expected publication date June 2011 The company will conduct five-yearly noise modelling of airport ground noise by the end of 2010 and 2015 Neither on track or behind schedule. The dates included within this commitment relate to an expectation of when the airport will handle 40mppa, originally forecast for 2015. Latest forecasts expect 40mppa to be reached around 2020 and we have modelled the airport's ground noise in line with the update of our master plan, which will be published in winter 2011. This has been agreed with WSCC and CBC. The outcome of the modelling of airport's ground noise will be published in summer 2011. Verification findings This commitment is neither on track or behind schedule. 27

Issue Status Comment on 2010 Action plan for 2011 GAL made an agreement with CBC and WSCC in 2010 to amend the dates when noise modelling of airport ground noise will be carried out. These dates were amended to tie in with the update of GAL s master plan that will be published in late 2011. No documented evidence could be provided to confirm agreement of the amended delivery dates of airport ground noise modelling. Although no formal minutes could be provided, GAL, WSCC and CBC confirmed that during 2010 GAL sought agreement with WSCC and CBC via the S106 Steering Group, to amend the stated focus of a number of noise actions. It is recommended that where agreement is sought to amend the delivery dates in the S106 agreement, written agreement should be sought. As a result of the amended dates to undertake airport ground noise modelling, no noise modelling was undertaken in 2010. Within the Master Plan aircraft ground noise levels are to be calculated for 2019 and 2024/25. GAL submitted the END Noise Action Plan to DfT and DEFRA in November 2009 and subsequent amendments were submitted in June 2010. As the END Noise Action Plan has not been adopted at the (time of audit) by the Secretary of State, GAL is currently not monitoring progress against this. GAL updated stakeholders throughout 2010 on the progress of adopting the END Noise Action Plan. The END Noise Action Plan was published in Summer 2011. It was agreed with WSCC and CBC in 2010 that when the END Noise Action Plan is adopted this will supersede the S106 Noise Action Plan. As no noise modelling of airport ground noise was completed in 2010 and no formal documented evidence could be provided confirming the agreement to amend the delivery date this commitment is neither on track or behind schedule Verification recommendations, including GAL response It is recommended that where agreement is sought to amend the delivery dates of ground noise modelling in the S106 agreement, written agreement should be sought at the time of amendment GAL RESPONSE GAL agree with the findings of the auditors and will improve the documentation process regarding potential future amendments to agreed commitment delivery timescales. The Company s approach and priorities in mitigating and managing the Airport s noise impacts will be described in a Noise Action Plan, produced and reviewed in accordance with the Action Planning Obligation and informed by information obtained, and progress, in preceding years. The Company s annual monitoring report will review the delivery of the action plan and other noise management activities, Gatwick's first draft END Noise Action Plan was submitted to DfT & DEFRA in November 2009. Subsequently, there have been several amendments made with a final draft action plan submitted in June 2010. Since then we have been awaiting formal adoption by the Secretary of State. As soon as the END noise action plan is formally adopted by the Secretary of State we will begin to formally report progress through the existing 106 reporting channels and through our annual FEU and 28

Issue Status Comment on 2010 Action plan for 2011 including collaborative work with other parties. The Company will produce five-yearly forecast contours to investigate the potential impact of the airport on the surrounding community. Models will be run for 2015 and 2020 by the end of 2010, and 2015 respectively. We have produced forecast contours for 2024/25 in line with the update of our master plan, which will be published in summer 2011. This has been agreed with WSCC and CBC. Sustainability performance reports. The forecast contours will be published in summer 2011. Additional performance data 2006 2007 2008 2009 2010 CDA 81% 81% 84% 88% 89% FEU activity Callers 794 672 406 473 409 Enquiries 6758 5288 6315 6497 6936 Night quota winter Movement limit 3250 3250 3250 3250 3250 Noise quota 2300 2240 2180 2120 2060 29

Night quota summer Movement limit n/a 11200 11200 11200 11200 Noise quota n/a 6700 6600 6500 6400 57dBA Laeq daytime contour Population (individuals) 4500 4800 3700 3600 -* Area (km 2 ) 46.7 49.0 46.7 41 -* * This data will not be available until late 2011. Interim Noise Action Plan During 2009 we had 55 active actions within the Interim Noise Action Plan their status as of 31 st December 2009 was as follows; Rating Number Green 38 Amber 10 Red 0 30

11. SURFACE ACCESS Our performance against S106 Obligations & Commitments The table below details our performance against the surface access obligations and commitments included in the 2008 Legal Agreement. Issue Status Comment on 2010 Action plan for 2011 Obligation 5.1 - Hold an annual meeting of the Gatwick Area Transport Forum and meetings of the Transport Forum Steering Group at quarterly intervals unless agreed otherwise. An annual meeting was held in January 2010 (delayed from 2009) and quarterly Steering Group sessions were held throughout 2010. A formal conference event was held in December 2010. Annual meeting held on 9th December 2010, quarterly steering groups scheduled during 2011. Obligation 5.2 - To maintain an Airport Surface Access Strategy and: by 31 December 2008 to publish the Supplemental Report on Commitments referred to in the Airport Surface Access Strategy; and review update and publish the Strategy by 31 December 2012 or to coincide with and support any material review of the Interim Master Plan, if that is sooner. The Gatwick Surface Access Strategy was published in 2007 Action 1 complete. Action 2 will be programmed as required. Surface Access Action Plan published for period 2010-12. ASAS expected to be reviewed for 2012 Obligation 5.3(.1) - The Company will support initiatives (such initiatives to be the subject of consultation with the Gatwick Area Transport Forum the County Council and the Borough Council) which promote in accordance with the Airport Surface Access Strategy the use by passengers and staff travelling overland to and from the Airport of modes of transport other than the private car and with Ongoing Transport Levy support for local bus services, express coach service, marketing initiatives and management of staff travel discount schemes, etc. Funding activities are governed internal through the PTL Governance Group. Ongoing Transport Levy support for local bus services, express coach service, marketing initiatives and management of staff travel discount schemes, etc. Funding activities are governed internal through the PTL Governance Group. 31