COMMISSION OF THE EUROPEAN COMMUNITIES
Brussels, 22.11.2000
COM(2000) 750 final
COMMISSION COMMUNICATION
to theEuropean Parliament and theCouncil
On
GALILEO
2TABLE OF CONTENTS
Summary
Introduction
A challenge facing Europe
Part 1: Definitionofthe system1.Users’ needs and services offered
2,Systemarchitecture
3.The integration ofEgnos into Galileo
4.Regulation, standardisationand certification
5.Internationalcooperation
Part 2: Economic and financialaspects
1.ThecostofGalileo
2.Galileo funding
3.The benefits provided byGalileo
4.Cash flows
Part 3: The management structure
1.Theinterimstructure
2.Thefinalstructure
RecommendationsANNEXES
1. The market insatellite radio navigation
2. The searchand rescue service
3. The Galileo development plan
4. The integration ofEgnos into Galileo
5. SummarydescriptionofGalileo
6. List ofstudies
7. Financial statement
3Summary
Satellite radio navigation is a leading-edge technologywhich enables the user of a receiver to
pick up signals transmitted by several satellites and thereby determine to a high degree of
accuracy and from one moment to the next not only the exact time but also his own position
interms oflongitude, latitude and altitude.
This technology, currentlydominated bythe United States with its GPS systemand by Russia
with its Glonass system and financed and controlled by the military, is notching up success
after success and is coming up daily with new applications in the countries of the Union and
throughout the world. The uses of these applications and the markets available to them
already cover a multitude of activities ranging from all types of transport (positioning and
measurementofthespeedofmoving bodies, insurance, etc.)to medicine (remotetreatment of
patients, etc.), law enforcement (surveillance of suspects, etc.), customs and excise operations
(investigations on the ground, etc.), agriculture (grain or pesticide dose adjustments
depending on the terrain, etc.).
In its communication of 10 February1999 the Commission presented an autonomous
programme on satellite radio navigation, known as Galileo, to be developed in four proposed
phases, including the definitionphase due to be completed atthe end of2000.
The successive phases of the Galileo programme
*Development and validationphase (2001-2005)
- Overalldetailed definitionofthe segments (space, ground, user);
- Development ofthe satellites and ground-based components;
- Validationofthe system“inorbit”.
*Deployment phase (2006-2007)
- Production, launching ofthe satellites;
- Installationofthecompletegroundsegment;
*Operating phase (2008onwards)
Replacement ofthe satellites, operationofthe Centres, maintenance.
Stressing the need to give a positive boost to our industries and services, while at the same
time ensuring Europe’s independence ina technologyas crucial as this one, the Council, in its
Resolution of 19 July 1999, called on the Commission to develop a system for civil and
globaluse managed bypublic civilauthorities and offering significant added value in relation
to the existing systems, while remaining compatible therewith.
During the definition phase in 2000, the Commission and the European Space Agency have
mobilised a very large part of the European space industry as well as a large number of
potential service providers with a view to defining the broad outlines ofthis project.
The present communication sets out the results of this phase. It reaffirms the strategic and
economic importance ofthe project and endorses a proposalthat it be continued beyond 2001,
4albeit subject to certain conditions regarded by the Commission as essential to the successful
implementationofGalileo.
Theseconditionsareas follows:The Commission takes the view that:
– satellite radio navigation is a key technology for the development of our economies and
that the deployment, to that end, of a constellation of EU satellites is indispensable to
safeguarding our independence;
– cost/benefit studies show Galileo to be cost-effective and sufficiently attractive to obviate
the need for anyfurther public funding inthe formofsubsidies from2007;
– for the development and validation phase (2001-2005), the essential funding from public
subsidies has been so planned that there is no need to call upon additional public
contributions, under budgets ofthe Communityor EuropeanSpace Agency;
– the funding of the deployment phase, comprising the construction and launch of satellites
and the establishment of the ground-based infrastructure network, will require private-
sector investment of some
€1.5 billion; and that an appropriate public–private partnership
willbe inplace intime forthedevelopment andvalidationphase;
– the setting-up of a public-private partnership requires a legal and financial framework as
soonas possible.
•A coordinated, provisional management structure for the Galileo project,
involving the Commission and the European Space Agency, should be set up by
2001.
•The proposals needed to set up the final structure with an investment budget
combining all the funds earmarked for the project will be drawn up by the
Commission.
•Egnosshouldbecontrolledbythisstructure.
•Areport will be made each year to the Council and to the European Parliament on
the progress made in this area, and on the setting-up of the programme
management structures, and to describe the funding of the deployment phase
(2006-2007)byDecember 2004.
5Introduction
Satellite radio navigation is a leading-edge technology. It results from the transmission in
orbit of signals which indicate the time with extreme accuracy. A receiver picking up these
signals from a constellation of several satellites can then determine to a high degree of
accuracyand fromone moment to the next not only the exact time but also its own position in
terms oflongitude, latitude and altitude.
This technology, currentlydominated bythe United States with its GPS systemand by Russia
with its Glonass system and financed and controlled by the military, is notching up success
after success and is coming up daily with new applications in the countries of the Union and
throughout the world. The uses of these applications and the markets available to them
already extend to a multitude of activities covering, of course, all types of transport
(positioning and measurement of the speed of moving bodies, insurance, etc.) but also taking
in medicine (remote treatment of patients, etc.), law enforcement (surveillance of suspects,
etc.), customs and excise operations (investigations on the ground, etc.), or agriculture (grain
or pesticide dose adjustments depending on the terrain, etc.). Furthermore, it is possible for
any individual to obtain, for a very modest outlay, a GPS receiver enabling him to pinpoint
his position on the road, at sea or in the mountains, albeit without any guarantee of accuracy
orcontinuityofservice.
As long ago as March 1998, at the instigation ofthe Council, the Commission presented in its
communication of 10 February19991an autonomous programme on satellite radio
navigation, known as Galileo, to be developed in four proposed phases: a definition phase in
2000, a development and validation phase up to 2005, a deployment phase up to 2007 and an
operationalphase thereafter.
The Cologne European Council in 1999 and the Feira European Council in 2000 emphasised
the strategic importance of Galileo and the need to take a decision on continuing the
programme inDecember 2000.
Stressing the need to give a positive boost to our industries and services, while at the same
time ensuring Europe’s independence ina technologyas crucial as this one, the Council, in its
Resolution of 19 July 19992, called on the Commission to develop a system for civil and
globaluse managed bypublic civilauthorities and offering significant added value in relation
to the existing systems, while remaining compatible therewith.
In their Decision of 23 July 19963, on Community guidelines for the development of the
trans-European transport network, the European Parliament and the Council included the
positioning and navigation systems as integralparts of the network and the related projects as
projects of common interest. In their Regulation on the granting of financialaid in the field of
trans-European transport networks of 19 July 19994, these two institutions also raised the
level of Communityaid for the positioning and navigation projects to 20%, thereby according
themclear priority.
1COM(1999)54final, 10.2.99
2OJ C 221/01, 3.8.1999
3Decision No1692/96/EC oftheEuropean Parliamentand oftheCouncil– OJL228, 9.9.96
4Regulation (EC) No 1655/1999 of the European Parliament and of the Council amending Regulation
(EC)No2236/95 –OJ L197/1, 29.7.99
6With the support of a large majority of countries on all continents which have supported the
development of Galileo as a European system compatible with the existing systems, the
EuropeanUnion has takensteps to ensure that the necessary frequencies were set aside during
the World RadiocommunicationConference held in Istanbulin May2000.
Lastly, the Council has emphasised on a number of occasions the importance of cooperation
with the European Space Agency in collaboration with which the Commission has just
prepared a communication on space which paves the way over the next few months to the
development of a genuine European strategy in the space sector. In this, Galileo will play a
keyrole.
During the definition phase in 2000, the Commission and the European Space Agency have
mobilised a very large part of the European space industry as well as a large number of
potential service providers with a view to defining the basic elements ofthis project.
The present communication sets out the results of this phase. It confirms the strategic
importance and economic attractions of the project and proposes that it be continued beyond
2001, albeit subject to certain conditions regarded by the Commission as essential to the
successfulimplementationofGalileo.
The successive phases of the Galileo programme
*Development and validationphase (2001-2005)
- Overalldetailed definitionofthe segments (space, ground, user);
- Development ofthe satellites and ground-based components;
- Validationofthe system“inorbit”.
*Deployment phase (2006-2007)
- Production, launching ofthe satellites;
- Installationofthecompletegroundsegment;
*Operating phase (2008onwards)
Replacement ofthe satellites, operationofthe Centres, maintenance.
7A challenge facing Europe
In its communication on Galileo of 10 February 1999, the Commission drew attention to a
number of major problems whichEurope will have to face up to over the next few years.
Satellite radio navigation enables dating signals to be transmitted which represent a vital
benchmark for our increasingly integrated economies. The banking, telecommunications and
energy networks and the abilityto synchronise signals for the transmission ofdata ofall kinds
are essential elements in this complex system of interrelationships. Europe (and the wider
world) cannot afford to rely exclusively on one, or even two, non-Community systems under
military control for the establishment of standards in areas which are of such crucial
importance and where the introduction of advanced safety features on a coordinated scale is
required.
The number of consumers of services generated in this sector is increasing day by day in all
areas of activity (management of moving bodies, positioning of objects, insurance, geodesy,
etc.). Dayby dayturnovers are growing, therebyplacing our economies more and more at the
mercy of these positioning and speed measurement systems based on satellite radio
navigation. Leaving aside the need to ensure a technicalabundance of signals compatible with
the high-precision applications affecting, in particular, the safety of human lives, can we
really afford to be dependent on just one non-European signal in order to safeguard these
turnovers and the jobs that willdepend thereon?
Galileo will open up possibilities for developing applications, many of them hitherto
undreamed of, which will help in the performance of public service tasks in a very wide
variety of areas (customs and excise, transport, policing operations, searches for missing
persons, the pursuit ofoffenders, judicialenquiries, humanitarianoperations, etc.).
As part of a new Community approach adapted to a new century, the most obvious user of a
precise positioning and speed calculation signal, viz. the transport sector, will be one of
Galileo’s key customers :
•Airspace and airports are becoming increasingly congested. More effective management
structures are gradually being put in place, but it is clear that this will not be enough. The
report of the High Level Group on a Single European Sky emphasises the importance of
introducing new technologies as a way of boosting capacity. While satellite radio
navigation is a key element, it will also be necessary for safety reasons to ensure an
abundance of systems (given that mere reliance on a foreign military system is out of the
question) as wellas ensuring integrity, i.e. a knowledge ofthe qualityofthe signalused.
•Tighter controls are also needed in the development ofsea transport. The Commission has
presented proposals for Directives5in this respect. Recent disasters such as the sinking of
the Erika oil tanker and the IevoliSun chemical tanker demonstrate the need for a certified
position report that only Galileo6can provide, in support of the new regulations on
maritime safety.
5COM(2000)142.final, 21.3.00
6Other satellite navigation systems will also be capable of providing this service to the extent that it is
certified and guaranteed bythe service operator
8•Inland transport, the principal mode of transport for goods and persons in our modern
economies, also needs to undergo reforms. According tothe Commission’s White Paper on
the Common Transport Policy7, no infrastructure will be capable of managing its own
growthunaided. An appropriate measure might be the imposition of an automatic, certified
reporting and registration obligation with regard to position and speed. Across the entire
territory of the European Union, only Galileo6will have the capabilities needed to enable
the authorities not only to identify traffic flows more effectively and hence manage them
more efficientlybut also to reorganise the economy inthe transport sector.
•The urgent need to speed up significantly policing, judicial and insurance dispute
procedures (with a resulting reduction in the cost of premiums) or commercial disputes
associated with transport (thefts, accidents, delivery delays, etc.) will mean that very soon
an active or passive position notification system, albeit of course certified and guaranteed,
will become an essential prerequisite. Once again, only Galileo will be capable of
providing the market with such a system. The same certified and guaranteed system will
enable users to pass by motorway, urban or other tollbooths automatically, and without
stopping.
Leaving aside dating and transport, Europe also needs to be wholly involved in the satellite
navigation revolution. Recent GSM and UMTS8developments in Europe (the two generations
of portable telephone which will eventually include the Galileo signal), and before that
developments involving Ariane and the Airbus, have clearly demonstrated the positive impact
that a determined, politically inspired and sectoral approach to modernisation will have on
employment, on industrial and economic development and on the enhancement of the
internationalinfluence ofthe EuropeanUnion.
The whole range of positioning applications (whether certified or not) will bring in their wake
a plethora ofnew services to be developed by a very large number of companies. The Galileo
receivers, which will also be capable of receiving Russian (Glonass) and American (GPS)
signals, will need to be able to penetrate those markets. The GPS, under pressure from users
and with the prospect of Galileo’s arrival on the scene, has benefited from the cessation
(overnight, as it were) of selective degradation9in May 2000. It is difficult to accept that our
receiver manufacturers and their users should be obliged to adapt, without prior warning, to
the vagaries ofa signaldecided onelsewhere.
Lastly, a further challenge inherent in this project is the mobilisation of the private sector.
This communication demonstrates that - apart from the socio-economic benefits which are
enough in themselves to justify the public funding of the entire project - there are sufficient
opportunities for generating economic returns from the development of Galileo to interest
industrialists and bankers.
Many other investors, be they companies interested in supplying components, satellites and
ground equipment, or, more importantly, large, medium or small enterprises specialising in
the provision of services, have confirmed that they will participate in Galileo once the
following two conditions have been met :
7COM(2000)…. final, ...
83rdgeneration ofmobiletelephonyallowingtheuseof veryhigh-speed Internetcapabilities
9Degradation ofsignalaccuracy, limiting civiluse
9•the necessary political and financial decisions on the launching of the development and
validationphase have beentaken;
•a single entity, operating within a precise institutional framework, has been appointed to
manage the various aspects ofthe programme.
10Part 1: Definition of the system
The aim of this chapter is to present the Galileo system based on the overall picture that has
emerged in the course of the studies conducted during the definition phase. The presentation
takes as its point of departure the needs expressed by the potential users and goes on to
describe the services needed to meet those requirements. The next part seeks to describe the
architecture of the system, designed in such a way as to be capable of providing these
services. Subsequent chapters tackle related matters pertaining to Egnos10and to certification
and international aspects which have been, and will have to be, taken into account during the
programme development and validation phase.
1. Users’ needs and the services offered by Galileo
A. Users’ needs
The approach to setting up a navigation infrastructure is based on the requirements expressed
by the potential users of the services offered, from the end user to the service providers
(important stakeholders in the value-added chain) and including the public authorities
responsible forimplementingawide varietyofrulesandregulations.
During the Galileo programme definition phase, consistent work has been carried out
involving consultations with a broad range of users covering a significant number of areas.
Various forums have been held in several areas of application such as aviation, the railways,
the maritime sector, road-linked applications, applications involving the general public,
scientific applications and time-distributionapplications.
For each forum, 50 or so of the most representative persons in their field, spread fairly among
the European countries involved in the Galileo programme11, were contacted and their help
enlisted in drawing up the specifications for the positioning, navigation, time and search and
rescue services.
As a result of these large-scale consultations, there is now a clear realisation of the need for a
global service, that is to say a service that covers the entire globe including the oceans and
desert areas, with a view not only to ensuring the continuity of services involving maritime
and aviation applications12but also to enabling the equipment manufacturers (notably the
receiving equipment manufacturers) to achieve economies ofscale in an unsegmented market.
The majorityofthe public and private players involved in these consultations also stressed the
fundamental need for channels of communication: only through the achievement of perfect
synergy between the positioning, navigation and dating services, on the one hand, and the
communication services, on the other, is there any likelihood that the services on offer13can
10Egnos, the European precursor of Galileo, is a satellite radio navigation system that relies on the
American GPSand theRussian Glonass systems and ensures their integrity, i.e. it warns the user over avery short timespan of any malfunction that might affect the quality of the signal retransmitted bygeostationarysatellites
11Also including the member countries of the European Space Agency which are not Member States ofthe European Union as well as countries applying to join the European Union
12In addition, this global cover will enable Galileo’s services to be supplied to the non-Europeanterritories of Member States of the European Union or of the European Space Agency in other regionsoftheworld
13At user level, the technical choices for implementing these channels of communication are immaterial
11be exploited to the full. Consequently, the concept of a “panoply” of services will need to be
fully incorporated intothe parameters ofthe navigationsystem.
Such a service is provided for in the basic solution presented in this communication through
the establishment of certifiable interconnections between Galileo and communication
networks located on the ground or installed in existing satellites. A technical alternative is
being studied as an option that could be exercised as early as the first half of 2001 and which
would involve launching a communications payload on the satellites. This possibility will be
adoptedonlyifit entails no appreciable cost implications forthe public investor.14
Involving communications facilities will also necessitate an in-depth examination of theregulatory aspects and, in particular, of the licensing and interconnection arrangements in the
internalmarket for electronic communications networks and services.
Applications will be forthcoming to improve mapping in Europe and beyond, particularly in
developing countries with which the Community has special relations. Applications focusing
on earth observation will also be studied as part of a global and sustainable development
strategy.
Galileo includes a set of equipment designed to provide a modern search and rescue service
15.
The signatory states to the International COSPAS-SARSAT16Convention, which are
currently implementing the only system of this kind covering the entire globe, have been
contacted and have openly expressed interest in a new service to be provided by Galileo. The
United States, for its part, is examining the possibility of setting up a similar and potentially
complementary system on future generations of the GPS. Apart from the number of lives
saved, this service is obviouslyof interest on a geopolitical and planetaryscale.
On the basis of the accompanying analysis of the present and future needs of users and of the
markets associated with the underlying applications, it has been possible to identify a set of
forecasts (number ofusers per field ofapplication) used inthe cost-benefit analysis.
Lastly, several parameters describing the different levels of service required for each type of
application have emerged from the analyses described above. The principal parameters
concern a global need for a degree of accuracy that is at least as good as that provided by the
GPS, for integrity17in certain specific areas - mainly those where human life is at stake18-
and for the availability of an improved service, both in urban (local) areas and in the Nordic
regions.
B.The servicesoffered by Galileo and theirapplications
14This assessment will need to include the possible legal, and hence financial, risks that such a solution
could entail, having regard to the commitments entered into in the framework of the World Trade
Organisation and given that the telecommunications sector is covered by the General Agreement onTradein Services (GATS, 1994).
15See Annex 3
16France, Canada,the United Statesand the Russian Federation
17Information on theintegrityofthesystem isrelayed totheuser bymeans ofan indicator providinghimwith information,virtuallyinrealtime, on thequalityof the signalstransmitted and on anymalfunctiondetected
18The demand for integrity in the range of services offered is expected to become the general norm in agrowingnumber of applications
12On the basis of the consultations conducted with the users, three categories of services have
beendefined to meet their needs.
1). The generalservice
This will involve the provision of a positioning, navigation and dating service compatible
withthe existing services but offering a greater degree of accuracy. It will be available for use
by any person in possession of a Galileo receiver receiving all the existing signals. No
authorisationwill be required to access this service.
The principal applications will be private road navigation, network dating, traffic information
systems and systems providing information on alternative routes in the event of congestion,
mobile telephony, etc. Numeroustypes ofreceiver willbe developed at widely varying prices,
depending onthe applications proposed.
In principle, there will be no charge for using this signal, although a quality certificate regime
(see Chapter 4, Part 2) maybe envisaged for high-quality, expensive receivers.
2). The commercialservice
Service providers using this service to give added value to their range of products will pay a
fee to the Galileo operator. The signal will contain data relating to the additional commercial
services being offered. In return for the fee, the Galileo operator will be able to offer certain
service guarantees.
The main applications will concern professional users who are ready to pay for a service
guaranteed bythe Galileo operator, notably in the areas of geodesy and in activities involving
customs and excise operations, network synchronisation, sea fleet management, vehicle fleet
management, road tolls, etc.
There will be controlled access to this service for end-users and the providers of value-added
services. This controlled access will be based on protected access keys (along the lines of the
PIN code for GSMs) in the receivers. Such a solution, yet to be confirmed by the service
providers, will avoid the need for the more onerous technique of signal encryption, although
the latter will still come under scrutiny during the validation phase. In fact, controlled access
willenable revenue to be collected fromusers who are subscribers.
133). The public service
This service will be offered to users who are highly dependent on precision, signal quality and
signal transmission reliability. It will need to offer a very high level19of integrity and,
consequently, to provide the user with a very rapid warning of any possible malfunctions. It
will need to be certified in accordance with the regulations applicable to the various modes of
transport(theICAOregulations inthe case ofair transport,the IMO regulations inthe case of
sea transport, as well as any future European regulations relating to the Common Transport
Policy). This service will require specialised receivers providing access to this enhanced-
quality signal. Depending on the decisions taken by the European or international standards
organisations, this service may be restricted to authorised users. Because of security
requirements, it will not be possible for all of the signals intended for this service to be
provided onthe same frequency.
Of particular concern are applications intended for air and sea navigation, the management
and regulation of road and rail traffic, the emergency services, road tolls, controlled access to
towns and cities, transport of dangerous substances, carriage and monitoring of dangerous
persons, humanitarianoperationsand, lastly, theregistrationofblack boxes.
The relevant revenues will be generated by providing controlled access to the signal for such
users as air traffic controllers, air companies, public network managers, rail companies, road
traffic controllers, the customs and excise authorities, etc. For services with high-level
securityrequirements, a signal encryption option has been included in the financial estimates,
and a decision on whether or not to exercise this option will be taken during the validation
phase.
In addition, a specific public service designed to assist in search and rescue20operations will
make it possible to locate persons and vehicles in distress. The vehicles will be fitted with
beacons which, having been activated in the event of an emergency, will send an alerting
signal to a rescue centre. An acknowledgement that the signal has been received and logged
willimmediately be sent back to the stranded person.
Furthermore, the use of one of the three services described above in conjunction with a
telecommunications service, e.g. GSM or UMTS, will enable positioning data to be supplied
or distributed in a much more user-friendly fashion, where necessary combined with other
information such as a road map, the distance to be covered, the pinpointing of traffic
congestion and information on alternative routes. It will also enable payments to be made for
tolls ofallkinds.
19No satellite radio navigation system of this quality, combining universality, accuracy, certification and
guarantees, existsat present
20A working party has been set up to incorporate this service within COSPAS-SARSAT (see page 9),whichatpresentdoes not send backthiscrucialsignalin order tokeep upthemoraleofthevictimsnordoesit guaranteethat thealert will be sounded instantaneously. The service will be free but will requirealicencefor thepurchaseofthebeacon
142. System architecture
The Galileo systemarchitecture must be designed in sucha wayas to permit:
- adaptation ofthe response to the needs ofusers and to market trends;
- integration ofservices other than navigation;
- minimisation ofdevelopment andoperatingcosts;
- minimisation ofthe risks, other than financial risks, inherent in a project so unusual by
virtueofits scope, complexityand the challenges it poses;21
- interoperability with existing systems, notably GPS, while at the same time
maintaining autonomy and competitiveness.
1. The main foundationsoftheGalileo system
The concept is global, that is to say it is based on the distribution of signals over the entire
surface ofthe globe, offering three major categories of navigationservices:
- a generalservice;
- a commercialservice;
- a public service.
With the exception of the general service, all the Galileo services provide system integrity22
information. The architecture is such as to enable other regions (groups of countries that may
have entered into partnership agreements with Galileo) to personalise the system integrity
information at a regional level.
With a view to facilitating interoperability at the user sector level and to promoting the
penetration of certain markets, it is also planned to disseminate integrity information relating
to the GPS satellite and, where appropriate, the Glonass satellite in addition to the integrity
information on the Galileo satellites.
Lastly, the need for information exchange or the onward transmission of the position of
Galileo users will result in the incorporation of the low-volume communications services in
addition to the navigation information. These services will rely on the existing terrestrial or
space infrastructure.
21These risks may be political or international in character, due mainly to the dual nature of the
technologies employed (some of Galileo’s equipment or components will be subject to the existing
rules governing the sector so as not to compromise the commitments and objectives of the EuropeanUnion in the field of non-proliferation), or the risks may be legal in character by virtue of certaininternationalconventionsandobligations (cf. lawof outer space, international regulationsgoverning airand seanavigation, WTO, etc.).
22Information on theintegrityofthesystem isrelayed totheuser bymeans ofan indicator providinghimwith information,virtuallyinrealtime, on thequalityof the signalstransmitted and on anymalfunctiondetected
15TheGalileo signals
The definition and optimisation of the services are wholly dependent on the characteristics of
the signal transmitted from the satellites and from the local ground components as well as on
the constraints affecting the use of the electromagnetic frequency spectrum. A twofold
approach is being adopted with regard to the Galileo signal frequencies:
– The basic solution set out in this communication relies on the frequency bands newly
allocated to Galileo following the World Radiocommunication Conference (WRC2000),
which offers Europe real technical opportunities in defining the signal, although certain
technicalconditions stillneed to be verified; the preparation of the next WRC, planned for
2003, forms partofthe validationphase activities.
– Two further options, based on the sharing and partial recovery of the frequency bands
allocated to the existing systems (the American GPS and the Russian Glonass), are
currently being studied with a view to ensuring optimisation of the use of frequencies and
of the performance offered, while at the same time reinforcing interoperability, and hence
robustness, withouthavingasignificant impact onthetotalcostofthesystem.
The final choice of signal characteristics will be made on the basis of the best technical
solutions23to emerge from a pooling of the results of the international negotiations. At all
events, a choice will be made inthe first halfof2001 during the validationphase.
The securityconstraints
Given that the use of Galileo by malevolent forces could pose a danger to European interests,
provision must be made for preventive action and countermeasures (withholding of the
service, controls on the export of certain sensitive components). These constraints will take
the form of measures to ensure the physical protection of the system and to control access to
certain services. In addition, Galileo will need to be protected against any external or hostile
intrusion into the systemaimed at modifying by whatever means (physically or electronically)
thesystemitselfortheserviceswhichit provides.
Consequently, in the event of a crisis, a European political body independent of Galileo
management structures - to be defined under the CFSP - will need to be empowered to take
the necessarymeasures. Inaddition, operationalprocedures will need to be put in place, under
23Thedefinition studiescarried outover a 12-month periodreveal that:
- Band C (5010 – 5030 MHz) offers certain attractions for new services to be envisaged in the
future, notably because it is more resistant to interference; consequently, an experimental payloadwill be installed during the validation phase with a view to taking a decision on the gradualintroduction of this option in future generations of the Galileo system; funding is provided forunder theassociated technologicalprogramme;
- all the proposed services require, as a minimum, the simultaneous use of 2 frequencies, in this
instancein BandL, with an adequatefrequencyseparation (Bands L1, and L2)(1164 – 1300 MHz;15590– 1610 MHz);
- given thepersonal safetyimplications of the public service (aviation being a typical example) and
theneedfor ittobeprotectedagainstallformsofinterferencefrom other systems, thisservicewilluse the band reserved for aeronautical applications (ARNSS - Aeronautical Radio NavigationSatellite-Based Services);
- the requirements associated with the protection of such services as the service needed to
implement the Common Transport Policy will probably necessitate the segregation of therelevantfrequencyspectrum
16the CFSP, between the body eventually designated and the Galileo management structure in
orderto manage possible crisis situations.
Data protection –and, in particular, the protection of private data – will be assured under
existing legislation.
2. The principalcomponents ofthe architecture24
The Galileo architecture is made up of four principalcomponents:
– the global-coverage space component;
– theregionalcomponents;;
– the localcomponents;
– the user receivers and terminals.
a) The global-coverage space component consists of the space sector, in this instance a
constellationof30mediumearthorbit25satellites, and the associated ground controlsector.
Before settling on this choice, several types of constellations26were studied using different
criteria. In particular, these studies show that the recommended architecture based exclusively
on satellites in orbit, and the architecture recommended here, ensures more uniform
performance both in terms of accuracy and availability and offers greater robustness in
crippled mode (satellite failure), particularly in the case of high latitude countries or in towns
and cities, while at the same time being less onerous .
The size and mass ofthe satellites under consideration for this type of missionshould ensure
optimumdeployment ofthe constellation through multiple launchings (5 to 6 satellites per
launcher).
The ultimate choice of launcher(s) willbe made ona competitive basis and will depend on the
payload capability (number of satellites) for the period in question, on reliability factors,
proposedcostsandcontractualconditions(insurance).
The ground segment27consists of the satellite control centres (telemetering and telecommand
stations to keepthe satellites onstation) and the centres needed to provide the services.
24Seedevelopmentplan in point4
25The MEO (medium earth orbit) satellites are evenly distributed over 3 orbital planes at an altitude of
about 23 000km
26As mentioned inthecommunication of10 February1999, varioustypes oforbit were considered for theconstellations: LEO (low earth orbit), MEO (medium earth orbit), GEO (geostationary earth orbit),
IGSO (inclined geosynchronous orbit). During the definition phase, several studies focused on
constellations based solely on MEOs (10 to 33 satellites at different inclinations) and on a combinationof MEOs (18 to 27) and GEOs (8 to 9). Lastly, two types of architecture were subjected to moredetailed comparisons: 30 MEOs on 3 planes and 24 MEOs and 8 GEOs, all in the light of differentcriteria (performance attained, geographical uniformity, risks and costs, management constraints). Thebest performance is provided by the 30 MEO architecture, particularly at high latitudes and for asignificantlylower cost
27The terrestrial segment wherebythe service is provided consists mainlyof:
- theintegritycontrol stations;- theinterfaceswithothersystems(COSPAS-SARSAT, UniversalTime);
17b) The regional components
The system is global and integrity is spread world-wide. However, the design of the system is
such as to permit the introduction of regional components (up a maximum of 8 all over the
world), thereby making it possible to “personalise” integrity under partnership agreements
with the relevant countries. The cost of this component will be borne by the region in
question.
Aregionalcomponent is made up ofanadditionalnetworkofstations to oversee the integrity
ofthe signals and a processing centre to provide this service.
c. The localcomponents
The Galileo system will provide a high level of performance to users world-wide, even in
places where there is no ground infrastructure. However, inthe case of specific applications in
given areas, even more demanding levels of positioning performance will be necessary or,
alternatively, integration with other functions, e.g. local communications, will confer added
value on the basic service.
In this way, starting from a common generic conception, it will be possible to adapt local
elements to specific requirements:28airports, ports, rail, roads, urban areas, etc. Furthermore,
each application will need to make provision for specific cases: roadtunnels, urban buildings,
underground parking complexes, etc. The definition phase has enabled a preliminary
conception to be formed of these localelements, and this will be elaborated further during the
development and validation phase.
Typically, a localelement will need to ensure the onward transmission of the signal, including
integrity monitoring and data processing and transmission.
Data may be transmitted to the user's receiver either via a specific link or by means of
external systems: mobile communication networks (using GSM or UMTS standards), Loran-
C maritime navigation system, etc. Inthe last mentioned instance, detailed information on the
user's exact position will also be available to the operator. By means of messages linking the
TerminalandtheServiceCentre it will be possible to confer added value onthe basic service,
e.g. pinpointing the location of distress calls or breakdowns. This, in turn, will cause thought
to be given to the introduction of possible changes to the existing standards, with a view to
incorporating the capabilities offered byGalileo.
For certain modes of transport such as aviation, the existence of a local component offering a
landing service adapted to the meteorological conditions prevailing in Europe will play a key
role in rationalising the existing structures and making satellite navigation more attractive
economically. For this reason, the Commission is committed to promoting the necessary
technical and economic studies and, if the scheme is clearly feasible, it will facilitate the
organisationofa localservicethroughthestructuresput inplace.
3. The Galileo receivers
- the communication networks between the various terrestrial segment components;
- thenavigation mission control centres
28In general, these specific requirements will focus on the need for a high degree of accuracy (down toless than a metre) and the need for local integrity information to trigger an alarm in a very short spaceof time(e.g. lessthan a second in the case of civil aviation) or to facilitate the continuity of the servicein an urban environment when satellitevisibilityisreduced or down tozero
18These receivers will be the crucial link in the Galileo chain and will need to satisfy market
requirements:
– competitive performance and costs compared with the existing systems;
– adequatetailoring tothe needs ofusers (generalpublic and the professionalmarket);
– potentialfor change and integrationofthe services (e.g. communications);
– possibilityofmulti-modaluse;
A wide range of Galileo receivers will be available providing the various types of satellite
radio navigation services on offer, whether or not combined with other functions. In addition,
the technological potential will lead to a high degree of integration of these functions
(standard "microchips" tailored to a specific function). By way of illustration the following
examples maybecited:
– Galileo mini-terminals for use by the general public, or the incorporation of a positioning
function as an integral feature in mobile telephones (UMTS standard), providing value-
added services or position location facilities in the event of “112” calls (emergency
services);
– the integration of a navigation service certified under aircraft industry standards in the
operationalsupport systemfor aircraft pilots;
– an in-vehicle navigation platform offering the driver combined positioning and traffic
information monitoring facilities.
The challenge of the market in Galileo receivers represents one of the major factors that will
determine whether the Europeanindustrysuccessfullytakes off inthis area.
4. The Galileo development plan29
Under the arrangements to extend the definition phase which is due to conclude at the end of
2000, the Galileo development planwill be divided into two mainphases:
Adevelopment and validationphase (2001–2005)
The development and validation phase, due to commence in 2001, will cover the detailed
definition and subsequent manufacture of the various system components: satellites, ground
components, user receivers.
This validation will require the putting into orbit of prototype satellites from 2004 and the
creation of a minimal terrestrial infrastructure. It will allow the necessary adjustments to be
made to the ground sector with a view to its global deployment and the launching, if
necessary, ofoperationalprototypes manufactured inparallel. During this phase it will also be
possible to develop the receivers and local elements and to verify the frequency allocation
conditions imposed bythe International Telecommunication Union.
Aconstellationdeployment phase (2006–2007)
29See diagram in Annex 5
19This deployment phase will consist in gradually putting all the operational satellites into orbit
from 200630and in ensuring the full deployment of the ground infrastructure so as to be able
tooffer anoperationalservice from2008 onwards.
During the system validation phase, as described above, the risks inherent in the programme
will be reduced by a programme of technological support to help finalise the critical choices,
both technical and technological (atomic clocks, receivers, use of Band C,
telecommunications payload, intersatellite links, etc.). It is important to consider these
activities so as to ensure that the second-generation Galileo system remains adapted to the
changing needs ofusers.
Consequently, users will have an operational Egnos service at their disposal from 2003 (see
Chapter I.3) and will witness the gradual introduction ofan operational Galileo service by the
beginning of200831at the latest, withthe Egnos services being provided in paralleluntilthey
are phased out altogether.
3. The integration of Egnos intoGalileo
Egnos, the European precursor to Galileo, is a satellite radio navigation system that relies onthe American GPS and the Russian Glonass and monitorstheir integrity, thereby warning the
user ina very short space of time of any malfunction that could affect the quality of the signal
relayed bygeostationarysatellites.
32
Annex 5 describes the characteristics and benefits of Egnos, its potential for mobilisingEuropean expertise in engineering, manufacturing and the provision of services in the field of
space applications and, lastly, the process whereby it will be gradually integrated into the
architecture and structuresofGalileo, eventuallydisappearing fromthe scene byabout 2015.
4. Regulation, standardisation and certification
Galileo will make an essential contribution to the good management and safety of all modesof transport. It will enhance the quality of existing systems by virtue of its being managed by
civilians and by virtue of its global coverage, precision, integrity and the guarantees it will
offer.
The provision of these features will require a system for regulating the activities in question
through the imposition of standards to be complied with and the monitoring of such
compliance bythe competent Communitybodies.
Regulation and certification will require Community legislation. In developing and
implementingsucharegulationandcertificationsystem, the Commissionwillenlist the aid of
the existing public structure, to whichcertainactivities could be delegated.
30I n order toensureadherencetothistimetable, satelliteproduction shouldcommencenolater than 2004
31Access to the market would require a more concise development plan, and a number of approaches are
being examined: e.g. provision of a commercial service for the general public in advance of the othertechnically more exacting services. However, given the risks currently being assessed (availability ofclocks, etc.), it would be premature to commit oneself to such a timetable. Nevertheless, once the initialtechnical tests have been carried out, work can begin on the campaigns to promote the Galileo satelliteapplicationsandtoverifytheregulatoryuses, probablystartingin 2006
32I n circular orbit36000kmabovetheterrestrial equator
20Given that Galileo will be providing services on an international scale, the European Union,
in cooperation with the European certification bodies, will need to define the positions to be
defended by the Member States within the framework of international organisations such as
theICAOandtheIMO.
5. International cooperation
International cooperation is essential to a project of such international potential as Galileo. Itis equally essential in terms of ensuring interoperability with existing systems, of involving
third country markets and, lastly, of installing the ground sector components in certain parts
of the globe. A Committee, made up of representatives of the Member States, will be
responsible forassistingtheCommissioninthe negotiations/discussionswiththirdcountries.
In accordance with the mandate which it was given by the Council in October 1999, the
Commission has embarked on formal negotiations to identify potential areas of cooperation
with the countries that own the existing systems, viz. the United States and the Russian
Federation, and, in a wider perspective, with third countries having an interest in the
development ofGalileo.
The results ofthe World Radiocommunication Conference held in Istanbul in May 2000 have
demonstrated notonly the strong support for Galileo onthe part of many countries across five
continents but also the need to coordinate access to new frequencies allocated to radio
navigationunder InternationalTelecommunicationUnionrules.
1. The negotiations with the United States have helped to clarify a number of the points that
have to be dealt with.
Initially, the European Union and the United States have discussed and documented their
ideas on the spectrum, the signal, the security of the systems, standardisation and
interoperability requirements. Both parties are agreed that the principal objective is to ensure
compatibilityand interoperabilitybetweenGalileo and the GPS.
The European Union has, on a number of occasions, voiced its determination to forge ahead
rapidly with the technical discussions. As far as the present American delegation is
concerned, the top priority is probably the Council Decision of December, followed by the
preparation of a framework agreement on the principles signed up to at high level, which
would serve as a basis for allsubsequent technicalwork.
Nevertheless, the Commission intends to pursue contacts at all levels so as to be in a position
to consolidate the definition of the interoperability and frequency sharing options with the
GPS before the middle of 2001 and to reconcile international technical positions as within the
ICAO, IMO orCOSPAS-SARSAT.
2. Negotiations with the Russian Federation are taking place at political and technical levels.
They are based on a cooperation scenario aimed at promoting the coexistence of two
independent constellations (Glonass and Galileo), while at the same time seeking to achieve
possible reductions in investment costs. They are based on the principles associated, on the
one hand, with an exchange between interoperability and frequency sharing and, on the other,
withindustrialcooperation.
21Four significant industrial cooperation projects, financed by the European Space Agency, the
Commission and certain Member States, have started up under the supervision of the special
negotiationCommitteeset upbytheCouncilto assist theCommission.
Initial discussions on a possible framework agreement with Russia and spectrum sharing are
making good progress. It is proposedto draw upan initialbalance-sheet bythe end of2000.
At the last EU/Russia Summit on 30 October 2000, the Joint Declaration mentions that: The
sides recognise the importance they attach to pursuing the cooperation initiated between the
Russian and European satellite navigationsystems (Glonass/Galileo).
3. The Commission is eager to involve other partners in Galileo at an early stage. At the
Council’s request it has identified and verified the interest expressed by a number of countries
in participating in Galileo, notably on the occasion of the World Radiocommunication
Conference referredto above.
Moreover, the configuration of the systemwill be such as to confer a high regional profile on
the integrityinformation, therebyproving particularlyattractive to third countrygroupings.
Such participation could take place at two levels: at the level of the direct investment and
industrial work necessary in the development and operational fields, or at the level of user
applications and equipment.
In Europe, the participation of Switzerland and the EFTA(European Free Trade Area)
countries is assured, and discussions are currently under way with Central and East
European countries andUkraine.
Canadais involved financially in the Galileo definition studies. This promising cooperation
will help to develop the regional element across the American continent - an indispensable
requirement if regional signal quality control is to be guaranteed. In accordance with the
Council Resolution, the Commission is likely in the near future to present a draft mandate for
formal negotiations with Canada.
Contacts with a number of Latin-American countries will need to be renewed and
intensified in 2001 so as to enable Egnos to be validated in real time. Exploratory contacts
have been initiated with Australia .
Israeland a number of African countries (South Africa, Kenya, Egypt, etc.) as well as
severalAsian countries (China, Korea, India, etc.) expressed a keen interest at the
Telecommunications Conference and inthe courseofbilateralmeetings.
A particular effort will be made to examine the possible uses of Galileo and their specific
nature and economic potential in developing countries in the context of Community
agreements liketheoneconcludedwithACPcountries.
22Part 2: Economic and financial aspects
The first chapter incorporates a table setting out (a) the cost of the various phases of the
programme (see summary table below) and of the management of the operating system and
(b) the socio-economic benefits for society in general when it becomes operational, and the
more immediate financialadvantages -interms of service supply and equipment sales.
The second part describes the funding schedule for the various stages of the programme by
listing both the public and private-sector contributions. Here the Commission stresses that, in
view of the expected turnover figures, the private sector could contribute €1.5 billion to the
fundingof thedeployment phase.
The final part describes various sources of revenue, and more particularly a special tax when
Galileo becomes operative.
The successive stages of the Galileo Programme
Development and validationphase (2001-2005)
Detailed definitionofthe sectors as a whole (space, ground-based, users);
– development ofsatellites, ground-based components;
– “in-orbit” validation ofthe system.
Deployment phase (2006-2007)
– satelliteassemblyand launching;
– installationofcompleteground-basedcomponent;
Operating phase (from2008)
– satellite renewal, operation ofthe Centres, maintenance.
1. The cost of Galileo
The cost estimate covers a Galileo system able to offer the various general, commercial and
public-interest services described in Chapter I.1. The cost covers the entire development,
validation and deployment phases of the complete constellation enabling an operational
service to be supplied to customers. Basically this involves:
– detailed definition studies preceding the production of the spatial, ground-based and user
components;
– assembly of the satellites, including prototypes and then production models, and the
associated testing equipment;
– assemblingground-basedcomponents, deployingtheseandtherelevanttesting;
– satellite launching and their in-orbit validation;
23These costs are summarised in the table below, which sets out the main items and draws a
distinction between the development and validation phase and that of deployment of the
various planned installations.
Certain hypotheses or details are worthyof mention:
– the deployment of local components, including those in Europe, is not included33;
converselythe definitionand generic designpart is included;
– a “searchand rescue” service onboard Galileo is included;
– the deployment of the ground-based stations needed in order to introduce an optional
regional (specificity) for integrity (outside Europe) is not included (conversely definition
and generic design are included); the States concerned will bear the cost of any such
deployment;
– the cost of incorporating Egnos into Galileo will be taken into account via the approach
described in Annex5 (Egnos’ initial operating phase between 2004 and 2008 is not
included and booked as being borne by its operator);
– thetechnological-support activities and the initial studies for the next generation of Galileo
areincluded;
– the launch cost is an average price for the commercial launchers in the Ariane5, Proton
range on the basis of a multiple launch; if a launch fails the cost of the relaunch, but not
replacement ofthe satellite, is included inthe estimate given);
– the costsofsecurityaspects are estimatedonthe basis of sensitive civilian infrastructures;
– the Galileo-certificationaspects are based onthe Egnos precedent;
– the cost ofdeveloping a basic receiver for eachservice is taken into account in the estimate
but not itstailoring to the wide range ofapplications.
Cost inmillionsof
euros (2000 price
estimate)Development
ValidationDeployment
Management,
engineering, systemsdesign160 130
Satellites 240 660
Launches 80 660
Ground-based
componentGlobal andregionalLocal480 380
Operations 70 210
33The cost of local factors is highly variable depending on the applications under consideration (by way
of illustration and per installation: from €100 000 for general-public needs to €1 million for aviation
needs). The short duration of their assembly (three months- one year) will permit adaptation to aEuropean developmentplan whichremainstobedrawn up in thelight of theapplications. Indeed, theseground-based components, which directly relay the signal in inaccessible spots (5% of Galileo cover)are especially necessary for the services to be licensed. The market will determine demand for these,their location and funding. The generic design and definition of these components form part of thedevelopmentandvalidation stageandareincludedin theestimate
24Technological-design
supportprogramme70 60
Galileo illustrative
estimate1100342100
Incorporating Egnos -5 0
Total cost 3250
Activities outside the development and deployment of the system as such, as will be
necessary to ensure the emergence of the markets identified, are set out in the table below.
The funding shown is a minimum expenditure threshold to ensure economic viability of the
programme as a whole. Other funding (private sector) is expected to come from the public-
private partnership context.
- Development ofapplications
- Supportforusersector
- Standardisation measures
- Support for the deployment of local
components€150 million
The annual cost of operating Galileo, including constellation replacement, is estimated to be
€220 million per year, €70 million of which are operating and maintenance costs. The annual
operatingcostforEgnosis €25 millionper year between2003 and 2007.
Egnos
2003 –2007Galileo
2008
Annual operating cost
inmillionsof euros25 220
Cost ofGalileo Programme (perphase) including Egnos(inmillionsofeuros) :
definition(1999-2000): 80
development and validation(2001-2005): 1.100
deployment (2006-2007): 2.150
operating (2008-): 220 peryear
2. Galileofunding
1. The development and validationphase (2001 – 2005)
According to the financialestimates the cost during that period will be roughly €1.1 billion.
That amount will be provided entirely by public funding (Community budget and that of the
EuropeanSpace Agency).
34This does not include support for the deployment of local components or for the development of
applicationsandreceivers which donot form part of thearchitectureas such.
25Community funding
The Community nature of the programme and its being a crucial feature of the common
transport policy and the “trans-European transport networks” initiative did, in essence, justify
the European Community’s role in both political and financial terms during the definition
phase.
The same applies to the subsequent phases of the programme and, as stated in the
Commission’s communication of February1999, the European-Union budget assigned to
Galileo will receive funds already earmarked in the existing financial forecasts (essentially the
trans-European networks and the 5th framework research programme and possibly future
researchactions whichare subject to decisions ofthe Counciland the EuropeanParliament.
As partofthe trans-European networks programme,the introducingofGalileo intothe MIP
(Multiannual Illustrative Programme) was put to the Committee on trans-European transport
networks by the Commission in September 2000. The latter proved this in principle in
accordance with the Council and European Parliament Decision of 19 July1999. The amount
corresponding to the activities under the Galileo Programme for the years ahead is roughly
€550 million . Under budget heading B5-700 this enables 50% of the cost of the design stage,
including technicalsupport,to be covered.
The 5thframework research programme will continue to set aside top-up funds for the
Galileo Programme’s development and validation stage. Any contribution from future
research actions is subject to its being adopted by the Council and the European Parliament.
These funds (5th framework programme and future research actions) will cover support for
the development ofapplications and receivers not forming part of the architecture as such, but
whose specification will be necessary when private partners or an operator are to be
identified.
The level of Community funding is critical since it will determine whether political control
can be maintained of the following phase of the programme. It will also help to guard against
any drawback resulting from the rules of geographic return provided for by the Convention
establishing the EuropeanSpace Agency.
The European Space Agency’s contribution
The European Space Agency has confirmed that it had long ago used its institutional
machinery to make plans for asking the Member States to subscribe €550 million35for the
validation phase if the political decision to continue with the programme were taken by the
transport Councilon20 December.
In short the cost of the development and validation phase amounts to €1.1 billion for
infrastructure and €150 million for the deployment of local components and the
development of applications and receivers.
All of the needs for the development and validation of the infrastructure have already been
covered by European public funding (European Union and European Space Agency) that has
already beenscheduled. No further public contribution bythe Member States will therefore be
needed.
35That request was based on the European Space Agency’s programme Declaration in 1999 estimating
thedevelopmentandvalidation phaseat €1 000 million
262. The deployment phase (2006-2007)
Beyond the current financial outlook the origin and amount of the Community’s contribution
and that of the European Space Agency still need to be determined during the validation
phase.
During that phase the estimated costs are €2.1 billion of which €1.5 billion can justifiably be
borne bythe private sector and €0.6 billion borne bythe public sector.
Other sources of funding can likewise be mobilised by the machinery used to award licences
for service suppliers or operators (calls for tender, bids, etc.) for example for the commercial
operation of the Galileo signal associated with local factors.
The table below sets out the private and public contributions to the three phases and, as
regards the latter’s contributions, a breakdown between those made by the European Union
and those bythe EuropeanSpace Agency:
Million Million Million
Sourcesoffunding
DefinitionphaseDevelopment and
validationphaseDeployment phase
(estimated)
European Space Agency3640 550
European Union
of which:
Trans-European transport
networks
5th Framework research
programme
Future research actions42.5 580 + pm
550
30
pm37600
(EU38and European
Space Agency)
Private sector 0 0 1 500
TOTAL 82.5 1 130 + pm 2 100
3. The operational phase (from 2008)
As soon as possible during the validation phase the Commission intends to propose that a
fund be set up to receive the public contributions while being open to private investment and,
where appropriate, an input from non-member states. This fund should give it legal
personalityand funding rules that are suitable for approvalbythe contributing parties.
No funding in the form of subsidies will be necessary downstream of the deployment phase.
Indeed, this could take place within the public - private partnership (see following section)
and via the new revenue flows described in Chapter 4 below.
36The funds needed for the following two phases will be mobilised subject to approval by the Member
States of the European Space Agency.
37The references to future research actions in no way prejudice the political decision of the EuropeanParliament and the Council asto those actions’ priorities, resources and management.
38The contribution of theCommunitybudget to the funding of Galileo for 2007 will be examined as partoftheprocess ofpreparingfinancialforecastsrelatingtotheperiodafter 2006.
274. The public- private partnership
This will be an essential factor for the success of the Galileo Programme. It will be built up
through an interim management structure responsible for the legal and financial package,
from the development and validation phase onwards in order to involve the private sector in
carrying outthe programme as quicklyas possible.
It should again be borne in mind, on a preliminary basis, that the cost incurred during the
deployment stage is estimated to be €2.1 billion of which €1.5 billion are estimated as able to
be borne bythe private sector39and €0.6 billionbythe public sector.
In order to meet a request made by the Council on 17 July1999, which called for substantial
funding from the private sector in Galileo, the Commission issued a call for an expression of
interest in order to establish the conditions needed in order to set up a public-private
partnership. SeveralEuropean industrialconsortia responded to this.
It emerges from the analyses carried out with the latter and from identifying the turnover
figures expected from Galileo operation, that involvement by private investors in the
programme is a thoroughly likely prospect in line with the estimated funding for the
deployment ofthe system, the local factors and the subsequent development of receivers and
services. However, there are a certainnumber ofprerequisites:
The political decision to continue the programme in December 200040; all insisted on an
urgent decisiononthat date.
The essential requirements regarding sound commercial operation of the services provided by
the satellite navigation system must be taken into account when the programme specifications
are drawn up - without which any subsequent adjustment to those requirements is likely to
increasethesystemcostssignificantly.
Ensuring that the technical risks attached to the project are kept under control by funding
prior studies.
Providing a single public management structure41i sp r o v i n gt ob ea ne s s e n ti a lp r e r e q u i s i t ef o r
reassuring potential investors as to the institutional stability of the project and to complete an
adequate funding schedule.
The predictive timetable for the intended spending would have to be accompanied by an
identification of the sources and amounts of public funding throughout the various stages of
the project, from the development and validation phase up to the deployment phase for the
constellationandthecorrespondingground-based installations.
39SeeSection 3B: thefinancialbenefitsderivingfromGalileo
40Seein this connection item10in theconclusionsreached bythe Transport Council on 9.10.97: “... TEN
projects require a firm political commitment on the part of the Member States, including from the PPPpoint of view, and welcomesthe Commission'swillingness actively to support effortsto establish PPPs,
theidentification of which willbethe responsibility oftheMemberStates”
41See in this connection item 5 of the conclusions reached by the Transport Council on 9.10.97:“considers that it is essential that a climate favourable to PPPs be created both at national and at
Communitylevelandstressesthe need for private sector involvement from the outset in the preparationof PPP projects, while keeping a balance between commercial and socio-economic criteria in theplanningofthe projects, andtheneedfor appropriaterisk-sharing”
28Allof these conditions should be met by2003 provided that a firmdecision on continuing the
programme is taken inDecember 2000.
Active inclusion of private partners from the system's initial development and validation
phase should enable not only the overall cost, but also the provision of effective management
and cost-controlsystems to be optimised. Moreover that involvement will help in drawing up
commercial-operation and cash flow management schedules that are associated with the
services provided.
It would seem that the contributions expected from private partners could cover a wide range
of areas spanning both involvement in kind and direct financial contributions, including the
development of equipment, carrying out pilot projects, acquiring operating licences or
transferring technologicaland commercialknow-how.
However, despite the encouraging long-term forecasts, the length of the period of return on
investment virtuallyrequires deferred funding ofthe deployment phase.
There will have to be a detailed description of the background to and machinery for selecting
the various partners and private investors in order to give the partnership an optimum balance
in the light ofthe successive phases referred to above. Compliance with the rules of the World
Trade Associationalso has to be ensured.
3. Benefits provided by Galileo
A detailed cost-benefit analysis of the Galileo system is set out in a Commission workingdocument. This is based on a macro-economic approach which emphasises the net gains to be
had from setting up and running Galileo. It only provides the information needed to aid the
decisionto carryoutthe project.
Europe’s crucial dependence on the American GPS in several strategic and commercial
applications is still escalating. It is possible to quantify that dependence by using data
concerning the current and potential use of GPS on markets linked to positioning and dating
services (principallythe transport, communications and finance sectors). The cost of a sudden
halt (for whatever reason) in the sale of those services for just a few days, without counting
the system destabilisation resulting from that halt would amount to
€1 billion in 2015. That
strategic factor must naturally be taken into account when analysing all of the benefits
provided byGalileo.
The advantages set out in the cost-benefit analysis concern only the extra activities generated
by Galileo as compared with the current situation of a GPS monopoly, otherwise known as
"zero option", and the emergence of positioning systems by mobile telephony networks
(GSM, UMTS, etc.). The existence of two independent but interoperable systems highlights
new areas of application and use and speeds up the introduction of navigation systems into
several areas where double sourcing is important. For example, the occultation constraints
inherent in the majority of urban landscapes reduce the availability of positioning service
supplyto some 55%ofthe territory, whereas the two satellite constellations together increase
thisavailabilityto95%.
Numerous factors help to highlight the difference that should attract, and even create in some
cases, a significant market for Galileo. On the one hand, the high reliability of the system
makes for a system of guarantee and liability that would be hard to imagine with existing
satellite navigation systems. On the other, taking account of its existence and, in some cases,
29the direct incorporation of other infrastructures, other services (UMTS) and local factors into
the basic design of the Galileo system will ensure complete compatibility across the whole
chain of services provided to users. A practical example of this would be the sector of
insurance, monitoring of marine pollution and civil aviation, as a precursor to the use of
satellite navigation.
As regards methodology, the overallassessment based onchanges in current markets provides
estimates which are being supplemented and validated by the second system set up during
Galileo’s definition stage, namely consulting potential navigation-system users and service
suppliers (road, rail, air and sea transport, communications and infomobility processing
systems, scientific research, etc.). Summarising the data acquired has enabled the orders of
magnitude inthe various areas ofapplicationto be better defined.
Bywayofa guide, market estimates for satellite navigation products and services suggest that
Galileo's market share could run to €9 billion in 2015. The inclusion of a positioning service
in mobile telephony applications will probably one of the main reasons for the spectacular
increase inthe use ofthese services (see Annex1).
With Galileo Europe will gain a foothold on the market of satellite navigation products and
services, which at present is totallydominated byother players, led by the US. This will have
a positive impact on the competitiveness of European industry. Mobile telephones or even
lap-top computers will incorporate a positioning chip in the not too distant future. The
demand that this creates should enable Europe to step up its production of components and to
add to its hand in the area of integrated systems and services, particularly motor vehicle
navigationand telematics services.
The macro-economic cost-benefit analysis has thus helped to quantify the greater net
economic gains for producers42(constructors of space systems, manufacturers of receivers
and application, service providers, etc.), on the one hand, and the "social" benefits, on the
other, such as greater safety in means of transport, greater fluidity in traffic, more efficient
road transport and less emission of noxious gases, etc. The analysis also focuses on the
strategic value of Galileo, not just in terms of the compatibility of its infrastructure with
existing systems, but also as a possible tool for implementing European policies on transport,
agriculture, environment, etc. The hypotheses underlying the analysis are limited to a very
conservative range of values, e.g. for reducing congestion in road traffic only a small
percentage will be down to Galileo, despite a number of fairly promising results from other
studies.
The results obtained from the macro-economic analysis clearly show the need for Europe to
put in place a navigation systemas soon as possible. The high rates of return indicated by the
analysis show, unsurprisingly, the intrinsic value of a system of this kind and the need to
involve the public sectorinthe initialfunding ofthe project. Giventhe size ofthe markets and
the profits, manufacturers will be increasingly keen to be part of it and the private sector will
doubtlesslybe a major player as fromthe deployment stage.
4. Cashflow
42At macro-economic level, any outlay on navigation equipment and services by consumers, who have
fixed purchasing power, will limit their purchasing power for products from other sectors, which willmean a modest overall gain for producers as a whole. On the other hand, Galileo will obviously
generate huge market potential and thus gains for the manufacturers of navigation equipment andproviders of services.
30The use of Galileo is likely to generate several types of specific income, which are described
below. The first may arise from three services (of general, commercial and public relevance)
provided, while the others willcome only fromcontrolled-access services.
1. The potentialcash flow fromallGalileo services
The Commission needs to look at howto introduce adutyonreceivers.
A duty based on industrial (or intellectual)property rights
A second source of income could be based on Community legislation enabling holders of
industrial(or intellectual) propertyrights to receive a royalty on their inventions. This already
applies to music and books (royalty on recordings and photocopies). That could easily be
extended to Galileo receivers.
A quality label
A quality label granted by the Galileo's operator would consist of a sort of stamp on the
receiver certifying that the product is approved by the operator. Such a system would of
course not be obligatory. It could be accompanied bycertainguarantees.
The operator could grant service-quality certification - similar to ISO certification - to
suppliers ofGalileo services. This would be a sales argument in favour ofan approved service
enabling reliable use to be made ofthe signalsupplied bya service provider.
Certification of this type would boost confidence in the Galileo system, but it would not
replace the certification required by the public authorities for "vital" applications such as
aviation.
2. The cash flow generated bythe commercialservice and bythe public-interest service inthe
case of"vital" applications
A licence fee
A fee of this type would be considered to be a means whereby a service could generate
income. Provided that the means to control use of the signal were available the Galileo
operator could conclude licence contracts withvalue-added service providers.
A sequence of licence contracts would enable a cascade of income to be generated by the
commercialservice.
A PIN code
A PIN code in chips inserted into receivers (similar to that in GSM mobile phones) could
enable a service to be introduced with controlled signal access. In practice users must enter a
code inthe receiver inorder to activate this for receiving Galileo's signals.
Concluding a contract between the Galileo operator and the receiver manufacturers is needed
in order to implement that option. The access codes will form part of the contract drawn up
betweenthe operator andthe service provider. The income would come fromthe final user on
acquiring a PIN code for his receiver.
A contribution from non-membercountriesusing the system
31Non-member countries or regional international organisations wishing to invest in Galileo
could make a financial contribution in exchange for the right to use the commercial service,
with certain guarantees. That would enable Galileo to be promoted and add impetus to the
standardisationprocess.
Part 3: Management structures
Currently the Galileo programme's management is shared between the Commission and theEuropean Space Agency, each of whom manages a certain number of contracts intended
successfully to complete the programme's definition phase in accordance with their own
administrative and budgetaryrules. One particular consequence of this is that the Commission
and the European Space Agency refer here to two different "steering committee", the first
consisting ofthe MemberStates ofthe European Union and the second the MemberStates of
the European Space Agency. The Programme Management Board (the PMB) comprising a
representative of the Commission and one of the European Space Agency is attempting, with
assistance from a coordinating office (the GPO), to compile the results of the activities
undertakenand to draw up acoordinated plan forthe future.
In view of the increasing complexity of the activities to be undertaken from 2001 onwards
and of the amounts of money involved, continuing with the programme needs to tie in with
budget management so as to guarantee that the activities conducted by the Commission, a
political institution, and the European Space Agency, a technical organisation, are
complementary.
1. The interim structure
Until the final structure is provided, a coordinated management framework for Galileo has tobe established as from the beginning 2001, clearly assigning political responsibility to the
Commissionand technicalresponsibilityto the EuropeanSpace Agency.
43
Thiswilltakethe formof:
1. regular, joint meetings of the two steering committees already set up by the Commission
and the European Space Agency designed to define the strategic approaches of the
programme, giventhat bothcommittees alreadyhave their ownterms ofreference and rules;
2. technical management by the European Space Agency as part of a service-provision
contractwiththeCommission.
2. The final structure
The final structure has to follow on from the interim structure. It has enjoy a certain amountof legal and financial independence in respect of its backers and be the contracting authority
for Galileo. It will thus have a budget combining all the funds for the programme. Once the
Galileo system is operational it will have to be managed by a private body (responsible for
marketing the services provided by Galileo and system maintenance) subject, of course, to the
relevant Communityrules.
Th eC om m i ssi onwi l ls ub m i tth er e s p e c ti v ep r op os a l s .
Conclusion
43In accordance with the resolution on a European space strategy adopted on 16 November 2000 by the
Research Council.
32The Commission takes the view that:
– satellite radio navigation is a key technology for the development of our economies and
that the deployment, to that end, of a constellation of EU satellites is indispensable to
safeguarding our independence;
– cost/benefit studies show Galileo to be cost-effective and sufficiently attractive to obviate
the need for anyfurther public funding inthe formofsubsidies from2007;
– for the development and validation phase (2001-2005), the essential funding from public
subsidies has been so planned that there is no need to call upon additional public
contributions, under budgets ofthe Communityor EuropeanSpace Agency;
– the funding of the deployment phase, comprising the construction and launch of satellites
and the establishment of the ground-based infrastructure network, will require private-
sector investment of some €1.5 billion; and that an appropriate public–private partnership
willbe inplace intime forthedevelopment andvalidationphase;
– the setting-up of a public-private partnership requires a legal and financial framework as
soonas possible.
•A coordinated, provisional management structure for the Galileo project,
involving the Commission and the European Space Agency, should be set up by
2001.
•The proposals needed to set up the final structure with an investment budget
combining all the funds earmarked for the project will be drawn up by the
Commission.
•Egnosshouldbecontrolledbythisstructure.
•Areport will be made each year to the Council and to the European Parliament on
the progress made in this area, and on the setting-up of the programme
management structures, and to describe the funding of the deployment phase
(2006-2007)byDecember 2004.
33ANNEXES
Annex1: The satellite navigationmarket
Size of markets and breakdown byapplicationsector
(i)Summary table ofthe market ( €billion)
1999 2005 2015 2020
GPS Market share due to
GALILEO in a GALILEO +
GPS environment
Europe 167 1 1
World - - 22 42
(ii)Size ofEuropean satellite navigation market 1999 – 2005
Market sector1999
€million2005
€million
Aviation 40 70
Maritimetrade 15 20
Road vehiclenavigation 700 2000
Fleet management 40 90
Rail 1 25
Cartography 50 100
Agriculture 5 10
Signal improvement 50 60
Mobilecommunications 0 3000
Dating 5 10
Personalnavigation 50 100
Defence 300 500
Total market ≈≈≈≈ €1 billion ≈≈≈≈ €6 billion
34(iii)World Galileo market in 2015
Application 2015
€Million
Drivers(allvehicles) 12600
Location/communication services 5100
Pedestrians 1500
Vehiclemanagement 900
Vehicle tracking 600
Recreational craftnavigation 190
Personalnavigation 120
Routefinding 110
Cartography 100
Emergencyservices 150
Other 750
Total ≈≈≈≈ €22 billion
35Annex2:searchandrescue (SAR)
The Galileo Programme provides a search and rescue service for users based on the
humanitarian and public service principles of the international Cospas-Sarsat system, while at
the same time making searchand rescue operations more effective.
Present system
The Cospas-Sarsat system consists of four low-orbit satellites and three geostationary
satellites, which can pick up sea and air distress signals and identify their location. This
information is then forwarded to Mission Control Centres, and then in turn to Rescue
Coordination Centres, which organise and initiate rescue operations.
The countries which set up the system are the USA, Canada, France and Russia. Many
countries, including countries inEurope, have their owndataprocessing centres.
Expected improvements
The following table shows current performance of the Cospas-Sarsat system and the expected
performance ofthe SAR Galileo system:
Criteria Cospas-Sarsat Galileo
R e tu r nl i n ktou s e r N o Y e s
Time taken for transmission of distresssignals to searchand rescue centreUptoonehour Approx. 1minute
Coverage Restricted Global
Accuracy Severalkm 10 m
Number offalse alarms > 90% < 10%
The search and rescue service will be improved by combining the conventionaldistress signal
detection system using the 406 MHz waveband with the positioning capabilities and
permanent coverage of Galileo. The aim is also to establish additional links to ensure the
transmissionofdistress signals, and organisationofrescue.
Performance ofthe present systemwillbe improved byusing the constellation of30satellites
and their corresponding ground sectors, withthe following advantages:
– continuous coverage bya number ofsatellites ofany point onthe earth’s surface, including
thepolarregions;
– shortertransmissiontimes because eachsatellite is always visible froma ground station;
– highly accurate positioning data, because of the use of receivers incorporated into beacons
and by improving the “Doppler” positioning accuracy of beacons not equipped with
Galileo receivers;
36– improved probability of detecting distress signals because of the simultaneous visibility of
severalsatellites at different angles ofelevation;
– reduced size and cost of distress beacons as a result of system performance and
technological integrationcapacityby2008.
Not only will this considerably improve the existing system but there are also plans to
incorporate new services, most of them based on establishing a communication link with the
people in distress. Return links to users will allow rescue teams to reassure victims that they
have received their distress signaland are organising a rescue operation. Return links willalso
make it possible to develop other applications such as removing doubt (in cases of false
alarms or presumed accidents), preventing accidents (bywarning of danger), and coordinating
rescue operations onthe spot.
Establishment of a search and rescue service byGalileo willprompt the Member States of the
European Union to participate in the Cospas-Sarsat search and rescue programme, alongside
the Member States which have signed the intergovernmental agreement and the suppliers of
the space sector (USA, France, Canada and Russia). This will demonstrate at international
levelthat theyare preparedto participate ina major humanitarianprogramme.
37Annex3: GalileoDevelopment Plan
ACTIVITY 200120022003200420052006200720082009
Development
Construction &
infrastructure
Validation in orbit
Deployment
InclusionofEgnos
Egnos
OPERATIONAL
SERVICES Validation ofEgnos
Demonstration
and validation
ofGalileoGalileo
Operational
Egnos
First Satellite Orbit
38Annex4: Integration of Egnos into Galileo
1. Background
As requested by the Council in December 199444, Egnos was designed as a supplement to
GPS and Glonass. Egnos is also Europe's first satellite navigation project.
Egnos will provide its users with enormous economic benefits and should eventually make it
possible to do awaywith a number ofconventional navigation facilities.
However, the potential advantages of the system are hampered by a number of limitations: it
is totally dependent on the GPS constellation, which is completely outside Europe's control;
its geostationary satellites do not fully cover the Nordic regions of Europe, and the concept
was implemented ona regionalbasis (Europe, NorthAmerica) rather thanglobally.
One of the reasons for developing Galileo is the need to overcome these limitations (but also
to provide new services).
Egnos includes a dysfunction warning system (the integrity concept) which the GPS and
Glonass constellations do not have. This service is essential for those users in the transport
sector who require a reliable GPS signal. The Egnos service will also meet an international
civilaviationstandard.
The rapid commercial introduction of Egnos will not only open a new market but will also
encourage partnership inthe future withthose who do not have Galileo.
The infrastructure required for Egnos will gradually be integrated into the Galileo
infrastructure, while maintaining the minimum requirements to supply a service which meets
internationalstandards untilapproximately2015.
TheEgnosandGalileo infrastructureswillhaveto beintegratedandmanagedcentrally.2. Integrating Egnos into GalileoArchitecture
As it emerges from the definition phase, Galileo will enable the best possible integration of
Egnos. This will be done in three stages.
During stage one, starting in 2003, Egnos45will allow the early introduction of a guaranteed
service based ona systemfor warning ofGPS failures (integrity).
44Council Resolution of 19.12.1994 on the European contribution to the development of a Global
Navigation SatelliteSystem (GNSS) –OJC379, 31.12.1994,p.2
45The Egnos ground segment will consist of:reference stations toreceive data from satellites;control centresto process thisdata andmonitor the whole system;up-link stationstosendinformation back tothegeostationarysatellites;a network for communicating between ground installations.The Egnos space segment will consist of three geostationary satellites; two which are currently leasedfrom Immarsat and a third, Artemis, which is being developed by the European Space Agency
39By2008, the Egnos infrastructure will have been integrated into the Galileo architecture, once
Galileo startsto operate. As a result ofthis integration:
– the configuration of Egnos control centres and other infrastructure will be rationalised so
thattheyalso become one ofGalileo's controldevices;
– the Egnos reference stations and up-link stations will be maintained;
– Egnos' communication capabilities will be reinforced for integration into Galileo's ground
segment;
– the geostationary satellites will be kept in operation until around 2015 with navigational
payloads.
After this date, the GPS service, with guaranteed integrity, will be provided entirely by
Galileo, and possibly by GPS III itself. The long-term optimisation of the Egnos ground
sector should provide users witha better service at lower prices.
Management
Egnos will be incorporated into the client structure established for Galileo.
In 2001 the Commission of the European Communities, the European Space Agency and
Eurocontrol, the European Tripartite Group currently implementing the Egnos system, will
launchaproceduretoselectthebodytooperatetheEgnossystem.46
Acontract willbe signed withthe operator selected for the management ofEgnos. It willbe alimited-termcontract and willhave to be reviewed before the dateonwhichGalileo is put
into operation.
46In 2001 an operator will be selected to manage Egnos infrastructure on the basis of an agreement
covering:the level of service required;operating costs;liabilityfor system dysfunctions;commercialpolicy;sources of income andmethods of collectingrevenue;interoperabilitywith existingregionalsystems
40Annex5: SUMMARY DESCRIPTION OF GALILEO
SERVICES
Galileo is a non-militaryprogramme. Its coverage is globaland it provides three services.
1. Generalservice :
- free access to signals;
- no informationonthe integrityofthesystemused.
2. Commercialservice :
- restricted access;
- integrityinformationavailable;
- excellent time accuracy(100 nanoseconds).
3. Public service :
Services related to personal safety:
– informationonsignalquality(integrity:usersarewarnedofanomalieswithin6seconds);
– service available 99.9% ofthetime;
– restricted access;
Services allowing the public authorities to regulate or operate certain activities (e.g.
transport): :
– sameperformance levels;
– guaranteed service withcertified controlled access.
Search and rescue :
– activated bydistress signals;
– acknowledgement ofsignalsent to distressed person immediately.
All these services allow two-way exchange of individual messages defining the location by
using existing systems (orusing Galileo satellites - optionavailable until2001).
SYSTEM
1) Signal:
Eachservice requires simultaneous broadcasting ontwo frequencies;
The basic solutionpresented inthis paper uses:
a frequencyscenario consisting ofthe wavelengths allocated to CMR 2000 (option terminates
in2001);
a possible scenario requiring negotiation with the Russians or Americans which should help
to improve the performance ofthe services provided.
412) Architecture
Constellationof30 satellites orbiting at average height;
The whole system has a level ofsecurityequivalent to that ofsensitive public infrastructure
The system is global with integrity distributed throughout the world. It also allows each
region (a maximum ofeight over the globe) to personalise its integritysignal
Local relay stations (at airports, ports, towns, etc.) make it possible to receive signals in
confined spaces: studies into defining and manufacturing prototypes have been financially
accounted for; on the other hand, this is not the case with deployment of the corresponding
infrastructure, whichwillbe funded bythe provider ofthe service concerned.
TIMETABLE
•Galileo
* Development and validationphase (2001-2005)
- Althe detailed definitionofsectors (space, ground, user):
- Development ofsatellites, groundcomponents;
- Val i dati onofth esy s tem"i norbi t".
* Deployment phase (2006-2007)
- Building and launching satellites;
- Establishing the entire ground sector:
- Integrating Egnos.
* Operationalphase (2008 onwards)
- Renewing satellites, running centres, maintenance.
•EGNOS
This is a land-based infrastructure which will make it possible to augment the integrity of the
GPS systemusing geostationarysatellites for users equipped witha specialreceiver.
* Development phase inprogress - 2003
* Operationalphase - Egnos only 2003 - 2008
* Operation alongside Galileo 2008onwards
(integration ofland-based infrastructure)
SUMMAR Y
Budgetary estimates are based on the various assumptions given above, including integration
ofEgnos.
* Validation phase €1 100million
42* Deployment phase €2 150 million
* Operationalphase €220 million/year
43ANNEX 6: LIST OF STUDIES
There are severalpackages ofstudies:
1. GALA
The objective of this package was to provide the mission specification, the globalarchitecture
and system specifications for GALILEO. The programme included the interfacing with the
other activities carried out during the GALILEO definition phase, to ensure that the
architecturaldesignwas co-ordinated and coherent
Documents carrying a securityrestrictionare not included onthe distribution list.
DocNo DocumentTitle
Dd001 ApplicationsDefinition& Sizing -ExecutiveSummary(dd001)
Dd005 Market Research Methodsand Overall Results(Volume 1)
Dd005 Market Research Methodsand Overall Results(Volume 2)
Dd043 Overall ArchitectureDefinition –Component definition
Dd058 PILOT PROJECTS -Synthesisof LLD (dd058v1)
dd067Development plan.
Dd087 Conclusionsand Recommendations
GALATrade-Off Between MEO and MEO+GEO Constellations
GALACommunication Service
GALAEGNOS Integration
GALASynthesisonServiceDefinition
GALASupportSegment –ArchitectureCo-ordination
2. GEMINUS
The aims of the GEMINUS programme were to define the services that GALILEO has to
provide to meet the requirements of the international subscribers. In addition GEMINUS
performed a series ofcase studies focused onspecific aspects of the service provision chain to
validatethestudyresults.
Doc No Description ofDeliverable orWorking
Paper
1. T ECHNICAL ANNEX
D8.1 Draft FinalSummaryReport
D1.1.2 Galileo User ForumsReport 2
D2.1 PPPEnvironment InterimReport 2
D4 Service Definition Report
443. INTEG
Since 1995 considerable effort has been dedicated to the EGNOS programme allowing
Europe to develop expertise in the GNSS field and to build an augmentation system for GPS
and GLONASS. The objective of the INTEG study was to analyse a seamless transition from
EGNOS to GALILEO from technical, economical, operational and institutional points of
view.
REF TITLE
INTEG-ASPI-D2.1B EGNOS Integration into GALILEO (INTEG) Report on INTEG
Requirements
INTEG-ASPI-D4 EGNOS Integration with GALILEO (INTEG) Ga lileo/EGNOS
Interface Definition
INTEG-ASPI-D3 GNSS-1 Programme ImplementationPhase
EGNOS Integration with Galileo (INTEG) Report on Proposed
EGNOS upgrades
4. GALILEOSAT
The GALILEOSAT programme covered the definition of the GALILEO space segment (the
satelliteconstellation)andofitsrelatedground system.
DOCUMENT TITLE Reference Issue
SYSTEM
Architecture definition ADD/GAL/0020/ALS 2
System Verification Plan
SPACE SEGMENT
Space Segment Definition Report GALI-ASMD-RP-0100-0001 1
NavigationPayload Definition GSAT.RP.00001.P.ASTR 1
GROUNDSEGMENT
G/SBaselineDefinition GSAT.SP.00002.P.MMS 1
455. SAGA
SAGA was designed to set up a platform for continuous standardisation activities up to the
operational phase of GALILEO. By establishing, through international bodies, a worldwide
recognition and interoperability between GALILEO and other systems such as GPS and
GLONASS, SAGAcontributes standards for Galileo to be adoptedinside and outside Europe
Doc No OutputWP
NoDescription ofDeliverable orWorking Paper
D1 WP1000 2. C OMMONSTANDARDISATION ISSUES AND BASELINEFOR
GALILEO
6. SARGAL
This project is to study the possibility of providing search and rescue services (SAR) through
the GALILEO satellites and also to expand these services by introducing a data link capability
for feeding back an acknowledgement to the distress beacon. It is addressing the technical,
institutional and operational issues with a view to replacing the current SAR (dedicated)
COSPAS-SARSATsatellitesbytheGALILEOconstellation.
Doc No Description ofDeliverable orWorking Paper
D2.10 3. SARGAL I NTERIM REPORT
7.MUSSST
MUSSSTobjective wasto establishthe generic principles forthe safetyapprovalofthe use of
GNSSbythe transport community. The outcome ofthe studywas a methodologyfocusing on
the development of a safety case for GNSS. The methodology was validated against existing
and future GNSS programmes.
Doc No Description ofDeliverable orWorking Paper
D94. MUSSST F INAL REPORT –SYNTHESIS ,GUIDELINES AND
RECOMMENDATIONS
46ANNEX 7: FINANCIAL STATEMENT
1. TITLE OFOPERATION
Communication fromthe Commission: “Galileo – results ofthe definitionphase
2. MainBudget Headings Involved
B5-700 Financial support for projects of common interest in the trans-European
network
B6-6 Fifth Framework Programme, Information Society Technologies (6-6121) and
Sustainable and CompetitiveGrowth (6-6131)
Other budget headings could be used as appropriate
3. LegalBasis
One or moreofthe following depending onthe actiontaken
Articles 74, 84(2), 113, 129c and 130iofthe Treaty
Decision No 1692/96/EC of the European Parliament and of the
Council of23 July 1996 on Communityguidelines for the development of the trans-European
transport network
CouncilRegulation(EC) No 2236/95of18 September 1995 laying down generalrules for the
granting of Community financial aid in the field of trans-European networks (as amended by
Council Regulation (EC) No 1655/99 laying down general rules for the granting of
Community financial aid in the field oftrans-European Networks
Decision of the European Parliament and of the Councilof 22 December 1999 concerning the
fifth framework programme of the European Community for research, technological
development and demonstrationactivities (1998 to 2002)
Other relevant documents
Communication from the Commission “Galileo – Involving Europe in a New Generation of
Satellite NavigationServices” COM (1999) 54 final, 10.02.1999
Council Resolution (EC - 1999/C 221/01) of 19 July 1999 on the involvement of Europe in a
new generationofsatellite navigationservices – Galileo – Definitionphase.
Communication from the Commission to the Council and the European Parliament –
‘Towards a Trans-European positioning and navigation network: including a European
Strategyfor GlobalNavigationSatellite Systems (GNSS)’
Council Conclusions of 17 March 1998 on a European Strategy for Global Navigation
Satellite Systems(GNSS)
European Parliament report of January 1999 on a European Strategy for Global Navigation
Satellite Systems(GNSS)
474. Description ofOperation
4.1. Generalobjective
The Communication demonstrates the technical and financial viability of the Galileo project
and proposes validation of the Galileo concept during the second stage. In fact the project
envisages development of a European satellite system (Galileo) which will contribute to the
implementation of a trans-European positioning and navigation network. The objective of
establishment of such a network is to improve the efficiency of transport systems by placing
at the disposal ofusers a systemallowing geographicalpositioning and precision timing. This
contributes to development ofsustainable and safe mobilityfor persons and goods, one of the
fundamental objectives of the Common Transport Policy. The project design also supports
other Community policies such as for employment, industry, environment, cohesion and co-
operationanddevelopment.
More specifically, a Galileo would provide added value in the formofa guaranteed high level
of service, making it more attractive to safety-critical and commercially sensitive users. It will
also enable PPP structures to be developed, involving considerable private investment in the
development of a system required for public-strategy reasons. Different possible revenue
streams are identified inthe Communication, some ofwhichrequire regulatoryaction.
4.2. Period covered and arrangements for renewalorextension
Full implementation ofGalileo is expected over the period 2000-08. This statement considers
onlyEU Budget financing forthe current financialperspective period of2001 – 2006.
5. Classification ofexpenditure orrevenue
5.1. Non-compulsoryexpenditure
5.2. Differentiated appropriations
5.3. Type ofrevenue involved
Not applicable6. Type ofexpenditure
Subsidy for joint financing with contributions from other parties (including the European
SpaceAgency, industry, nationalspaceagencies);
Researchanddevelopment activities(FrameworkProgramme)
Feasibility studies and demonstration projects (maximum Community contribution: 50%)
eligible for financial aid under the TEN
Grants or risk-capitalparticipation for investment funds under the TEN
TACIS support for training and the conversion of Russian industries from military to civil
purposes, in line with the Galileo programme
Interest-ratesubsidies, funded fromEuropeanInvestment Bank loans
Loan guarantees premium, on European Investment Fund guarantees
487. Financialimpact
7.1. The estimated cost of Galileo for the next two stages is put at €3.25 billion, which
will help to develop and deploy the system as such, plus a Community contribution to be
determined to facilitate the emergence of the markets identified. As far as the EU budget is
concerned, the cost will be met from resources already envisaged in the existing financial
programming, mainly for TENs. The additional costs linked to the emergence of the markets
identified will be met first from the fifth framework programme and also possibly by future
research actions which are subject to decisions of the Council and the European Parliament.
The Communication identifies other potentialsources ofrevenue.
The totalcost ofdeveloping Galileo, until2007, is expected to be as follows
Cost in €million
(2000)Development and
validationphaseDeployment
phaseTotal
2001-2007
Management &engineering 160 130 290
Satellites 240 660 900
Launching 80 660 740
Groundsector:
Global
Regional
Local480 380 860
Operations 70 210 280
Technologysupport
programme70 60 130
Galileo - Illustrative
estimate1100472100 3200
IncorporationofEGNOS 50
Totalcost 3250
Activities outside the development and deployment of the system as such, as will be
necessary to ensure the emergence of the markets identified, are set out in the table below.
The funding shown is a minimum expenditure threshold to ensure economic viability of the
programme as a whole. Other funding (private sector) is expected to come from the public-
private partnership context.
47This does not include support for the deployment of local components or for the development of
applicationsandreceivers which donot form part of thearchitectureas such.
49- Development ofapplications
- Supportforusersector
- Standardisation measures
- Support for the deployment of local
components€30 million+ pm
To sum up, the cost of the development and validation phase amounts to €1.1 billion for
architecture and a budget to be determined for the deployment of local components and the
development ofapplications and receivers.
The following indicative sources of financing at European level have been identified in the
period 2001-2006only:
€million
Sourcesoffinance forfixedcosts
Validationand development phase
ESA48550
EC
Of which:
TEN-Transport
FP5
Future researchactions580
550
3049
pm50
TOTAL 1130 + pm
48Subject to ESA approval procedures.
49Galileo will receive €30 million for the period 2001-2002 from the Fifth Framework Programme, the
balancebeingcommittedintheSixth FrameworkProgramme.
50The references to future research actions in no way prejudice the political decision of the Council andtheEuropean Parliamentastothoseactions’ priorities,resourcesandmanagement.
507.2. Itemised breakdown ofcost51
€million (current prices)
Breakdown522001 2002 2003 2004 2005 2006 2007532008 Total
Tens
(B5-700)100 170 80 70 70 60 pm pm550 +
pm
Research(B6-6)30-p m
54pm54pm54pm54pm pm 30 + pm
Total 130 170 pm pm pm pm pm pm300 +
pm
The annual breakdown of financing is provisional, and will depend on boththe phasing of the
project and the availabilityof funding.
8. Fraud prevention measures
The fraud prevention measures contained in each of the instruments proposed to finance the
different operations will apply. These include inspections, reporting, monitoring and
evaluation under Regulation No 2236/95, as amended, laying down general rules for the
granting of Community financial aid in the field of trans-European networks: in particular,
Articles 12(4) and (5) provide for regular on-the-spot checks by Commission staff and
Articles 15(5) and (7) provide for monitoring and evaluation. Similar measures exist for the
other Community financialinstruments involved.
9. Aspects of cost-effectiveness analysis
9.1. Specific and quantified objectives;target populationReference is made to the Commission working document on the results of cost-benefit
studies.
9.2.Groundsforthe operation
The Community contribution should be seen in the context of the measures to implement the
guidelines for the development of the trans-European transport network, particularly the
navigation and positioning network and the Common Transport Policy. Organising co-
operation on the basis of a clear strategy using the resources available in Europe is the only
means ofensuring a role for Europe inthe development ofGNSS.
51Figures applicablefrom2001areillustrativeanddependon theapproval procedures oftherespective
instruments. Thetable considers onlyCommunityinstruments(and not, for example, ESA funding)
522001-2005 = development and validation phase; 2006-2007 = deployment phase: 2008 = beginning ofoperational phase.
53The contribution of theCommunitybudget to the funding of Galileo for 2007 will be examined as partoftheprocess ofpreparingfinancialforecastsrelatingtotheperiodafter 2006.
54The references to future research actions in no way prejudice the political decision of the Council andtheEuropean Parliamentastothoseactions’ priorities,resourcesandmanagement.
51– In its Communication, Towards a Trans-European Positioning and Navigation Network,
(COM (98) 29of21 January1998), which was endorsed by the Council in its Conclusions
of 17 March 1998, the Commission set out the need for efficient and cost-effective
navigation systems, for civil use but compatible with military needs, high levels of safety
with adequate European control for safety-dependent systems, and opportunities for
European industryinthe emerging satellite navigation markets.
– The Commission recommended in its Communication on Space (COM (96) 617 final of 4
December 1996) the preparation of a specific action plan to develop GNSS as a key space
application for Europeanindustry.
– CouncilResolutionC 221 of19 July1999 (1999/C 221/01)
– Commission Communication “Europe and Space : turning to a new chapter” (COM 597
finalof27 September 2000).
It is necessary to rely solely on public funds during the development and validation phase as
the private sector is unable to free funds needed at the same speed, given the estimated
timetable for the initial return on investment. The private sector will come on board as from
the deployment phase to the tune of €1.5 billion.
9.3. Monitoring and evaluation ofthe operation
The operation must be monitored and evaluated with the aid of the Program Management
Board onthe basis ofthe following criteria:
•Evaluationoftheconclusionsofthedefinitionphase
•Credibilityofspecification for the various systemcomponents
•Consistency ofcomponent construction with specifications
•Validation of land components
•Validation in flight after launch of the first experimental satellite
•ValidationofGalileo system(ground and space segments, user receivers)
•Evaluationofprivate investment
Evaluation is important for the continuation of the programme in that moving on to the
subsequent phases willdepend onresults.
10. Administrative expenditure (Part A ofSection III ofthe GeneralBudget)
The requirements in human and administrative resources must be covered by the budget
allocated tothe operating DG.
5210.1Effect onthenumberofposts
Staff assigned
tomanaging
the operationSource
Type of post
Permanent
postsExisting resources
inth eD Go rs erv ic e
concernedAdditional
resources
OfficialsA
B
C5
2
25
22None
Total 99 N o n e
Staff assigned
tomanaging
the operationSource
Type of post
Permanent
postsExisting resourcesin
t h eD Go rs e r v i c e
concernedAdditional
sources
Temporary
agents out of
researchbudgetA
B
C2
-
12
-
1None
Total 33 N o n e
5310.3. Increase inother operating expenditure as a result oftheoperation
Budget heading
(number and title)Amount( €) Methodofcalculation
END (B6-6130) 148 6044E N Dp a i d
2 END not paid
AUX (B6-6130) 78 320 2 AUX-C
INT (B6-6130) 44 238 1 INT-C
TOTAL 271 162
Budget heading
(number and title)Amount( €) Methodofcalculation
A-7010 (Missions) 105 000150 annualmissions
withintheCommunity
25annualmissions
outside the Community
TOTAL 105 000