* Heathrow proposes three options for third runway
* London needs more runways to boost trade, tourism
* Heathrow plans opposed by environmentalists, London mayor
* Government commission to decide after 2015 election
By Rhys Jones and Brenda Goh
LONDON, July 17 (Reuters) - Britain's biggest airport, London's Heathrow, urged the government on Wednesday to let it build a third runway, saying its plans would provide more flights, less noise and be cheaper and quicker to build than rival proposals.
The UK government and business leaders want to expand flights to fast-growing economies to ensure the country does not miss out on billions of pounds of trade, and with Heathrow operating at 99 percent capacity, more runways are needed.
However, under pressure from green groups and its Liberal coalition partners, the Conservative-led government overturned a decision to build a third Heathrow runway after it came to power in 2010, and the move is also vigorously opposed by London's Conservative mayor, Boris Johnson, whom many commentators view as a potential rival to Prime Minister David Cameron.
Heathrow on Wednesday submitted its plans to a government commission looking into raising airport capacity, which is due to publish an interim report by the end of next year, with a final verdict due in mid-2015, after the next general election.
The West London-based airport, part owned by Spain's Ferrovial, suggested three options: placing a new runway to the north, north west or south west of the hub.
Each option would deliver extra capacity by 2025-29 for 14-18 billion pounds ($21-27 billion), and would be cheaper and quicker to build than rival hub options being proposed by Johnson and Stansted Airport, Heathrow said.
"There will be more pigs flying than aircraft if we are to believe the claim that three runways at Heathrow will make less noise than two," Johnson said after the plans were published.
"Their proposal would be a disastrous outcome for Londoners, nor would it solve our aviation capacity crisis as a fourth runway would need to be in the planning process before a third was even open."
Johnson is backing the development of a rival airport and earlier this week set out his plans, which include a new four-runway hub 40 miles east of central London and the possible demolition of Heathrow.
"Heathrow is not in the wrong place, it's in the right place for business," said Matthews, adding that hundreds of firms were based within 25 miles of the hub because of the links it offers.
"After half a century of vigorous debate but little action, it is clear the UK desperately needs a single hub airport with the capacity to provide the links to emerging economies which can boost UK jobs, GDP and trade."
As well as environmental groups, Heathrow's plans are opposed by local residents. A government report showed noise pollution levels of at least 57 decibels affecting around 260,000 people living near the west London site.
However, Matthews said by 2030 between 10 and 20 percent fewer people would be within Heathrow's noise footprint with a third runway, due to altered flight paths and the benefit of improved air-traffic control technology and quieter planes.
Heathrow said it preferred the two westerly options as they minimised the noise impact on local residents though they would cost more, and take longer to build than the north option.
The southwest runway, proposed to be built over two reservoirs, would be the most expensive and complex to build, but would mean aircraft noise affecting the fewest people.
Heathrow said all three options offered the chance of adding a fourth runway in the future, if needed, and said it would fund the runways itself rather than asking for taxpayers to pay.
Each option would raise capacity to 740,000 flights a year from 480,000 currently, and cater for 130 million passengers, up from the 70 million passengers that used the hub last year.
Johnson has proposed that London should have a four-runway airport, which would be either a new hub 40 miles east of central London on the Isle of Grain, or further out in the Thames Estuary on an artificial island, or at an expanded Stansted airport, to the northeast of the city.
Each of these projects would be deliverable by 2029, costing up to 65 billion pounds, Johnson said.