The futuristic, next-generation nationwide air traffic control system, for which the Federal Aviation Administration (FAA) plans to award a $1 billion contract this week, has been operating on a small-scale, limited basis in parts of Alaska for the past five years.

It has got a big thumbs up from Peninsula Airways (PenAir), the largest commuter airline in Alaska, eight of whose 40 aircraft presently use the system. The technology it will use is "truly amazing", say PenAir officials.

For the past five years, PenAir has operated under a special air traffic control system called Capstone, which the FAA developed specially for western and southeast Alaska. The system relies on the Global Positioning System (GPS) to control air traffic.

It provides moving maps that pilots in the cockpit can monitor to avoid collisions with other aircraft, or with mountains. Not surprisingly, it has dramatically improved flight safety in the remote northern state. The airline's fleet includes 40 aircraft, eight of which are equipped with the system.

Improved safety
Capstone has reduced accident rates by 47 per cent in western Alaska, where it is presently operational. The FAA estimates that state wide use could cut the overall accident rate by a third.

To use the system, each aircraft has to be fitted with an Automatic Dependent Surveillance-Broadcast (ADS-B) avionics suite. It uses GPS signals to automatically determine its location and then transmits that location to ground stations and to other aircraft equipped with the technology in its vicinity.

The ground stations relay the information to FAA air traffic control centres, which in turn feed the ADS-B data into cockpit displays of other aircraft, allowing pilots and controllers to graphically view the location of all aircraft in their vicinity.

Better control
With an ADS-B connection, PenAir officials can use a computer in the airline's Anchorage office to monitor any of PenAir's eight aircraft that are equipped with the technology. In the cockpit, the ADS-B helps pilots avoid the single largest cause of air accidents in Alaska - "controlled flight into terrain" - that means running into a mountain.

An ADS-B avionics system includes moving map displays of terrain the aircraft is flying over. It provides pilots with an electronic eye in the sky in bad weather. The system also provides visual and audible alarms. Using Capstone as a model, FAA plans to make an award this week for the ADS-B system.

Agreement in Alaska
Having successfully provided limited ADS-B access in Alaska for the past five years under the Capstone programme, the FAA announced in August 2007 that it had signed an agreement with aviation organisations in Alaska to fast-track the use of ADS-B throughout the state.

Apart from airlines PenAir and the Frontier Flying Service, this includes associations and statutory bodies like the Alaskan Aviation Safety Foundation and the Helicopter Association International. It also includes the Alaska Airmen's Association and the Alaska Air Carriers Association which represent owners of small aircraft and air freighters in the state.

FAA says that with ADS-B, pilots have a much better "situational awareness" because they will know where their aircraft (as well as others in the area) are with greater accuracy, and they are better able to maintain safe separation from other aircraft with fewer instructions from ground-based controllers.

The next-gen option
That is why it wants to extend the system to the entire United States by 2015. The FAA believes that this is the only way to manage greater numbers of aircraft in the same airspace and make better use of ground infrastructure like airports, which are expensive and slow to expand.

The air control system presently in use is based on old, '60s radar technology. Radar requires flights to follow a jagged path from one radar station to the next. There is an absolute limit to which it can be improved to catch up with growing traffic, as already seen in the mushrooming delays this year in the US.

GPS, on the other hand, lets planes signal their locations from anywhere, enabling them to travel more direct routes that save time and fuel. Satellite-based GPS systems have been guiding drivers, yachts, ships and even hikers for years now.

It maintains the high level of safety, but enables better utilisation of airspace. It will also allow planes to take off and land closer together, meaning less time waiting in line to use the runway for takeoff, and less time circling above the airport waiting to land.

Dollars and cents
But to adapt it for air control systems, every control tower and every commercial aircraft be retrofitted with GPS-based ADS-B systems. The estimated cost - to taxpayers, airlines and the flying public - is estimated at a staggering $20 billion.

The problem is, everybody wants it, but no one wants to pay for it. Fitting the onboard avionics suite will cost about $30,000 per aircraft, not a huge investment for a commercial carrier, but a considerable burden for the owner of a private plane.

Even in the planned Alaska rollout, the big question was a classical chicken-and-egg situation. Who spends first? Should FAA or airlines install the technology first? The recent agreement has finally sorted that out. The FAA has committed to a statewide rollout of the ADS-B ground infrastructure, while aviation groups in the state have committed themselves to install ADS-B avionics in 4,000 aircraft, which together account for about 90 per cent of the flying hours in Alaska.

Aviation users have requested $17.5 million from FAA to support ADS-B aircraft avionics installations in Alaska. The total cost of installing the ADS-B ground infrastructure is estimated at between $200 million and $300 million.

Who pays?
However, getting together an agreement at a national level is at quite another level. Here, the dispute is between commercial airlines and private aircraft. At present, there is a 7.5 per cent tax on air tickets to fund the FAA's air traffic control systems. Private aircraft, on the other hand, pay no flying tax at all, but pay taxes on aviation fuel.

Both airlines and the FAA contend that this structure is skewed heavily in favour of private aircraft. The FAA has estimated that for every $3,600 that a commercial jet pays in taxes, a business jet pays just $300, even though it is owned by a large corporation that easily afford to pay more. Both planes utilise the air traffic system to the same extent, and therefore 'cost' the FAA the same.

Airlines say the present taxation system should be replaced by a "per contact" charge, where each aircraft pays for the guidance it receives from air traffic control facilities, so that the costs are more evenly distributed. Private aircraft operators, on the other hand, want the present system to continue, where they pay a tax on fuel. They say they are willing for adjustments in this levy, but airlines say that is unlikely to make a significant difference.

The FAA's present mandate expires on 30 September, and new legislation will have to determine how the new mandate will be funded. Consequently, Congress is being lobbied heavily, both by airlines and private aircraft owners.

The FAA has made its views clear that only the GPS-based next-gen system will be able to take American aviation forward effectively, and the cost is unavoidable. The the only alternative to this expensive system, it says, is gridlock.

Naysayers
But a contrarian view has come forward, from the National Air Traffic Controllers Association, which says it is not the system that falls short, but infrastructure on the ground. It contends that the next-gen system will make little difference to America's chronically crowded airports and perennially understaffed control towers.

"You wanna double the aircraft in the sky? Do it," says Patrick Forrey, president of the National Air Traffic Controllers Association. "We just need more controllers and more runways to land 'em. Otherwise, it doesn't matter what whiz-bang stuff you got."

The $20 billion dollar question is, who's right? In the meantime, there's another set that's waiting for the next-gen system to be launched. For, it means big bucks to them.

Three industry teams are vying for the overall $1 billion initial ADS-B contract: ITT, Lockheed Martin and Raytheon. If FAA sticks to its schedule, the award will come no later than the end of this week.