The proposals now costed at £14bn will be released in detail as part of Heathrow’s public planning consultation in January.

Cut-price options being floated include dropping plans for a new terminal in favour of expanding existing passenger facilities at Terminal 2 and Terminal 5.

The airport owners will also phase construction to incrementally increase terminal capacity in blocks to better match growing demand.

Heathrow’s Executive Director Expansion Emma Gilthorpe said: “The Secretary of State set us the challenge to deliver an expanded airport for Britain with passenger charges staying close to current levels.

“We have now identified potential savings of £2.5bn and are increasingly confident we can meet the affordability challenge.

“We are looking forward to presenting detailed options on how to do it in our consultation in January, and while we will continue to work to reduce the cost of expansion, we will not compromise on our local commitments.”