Commission staff working document - Summary of the impact assessment - Accompanying document to the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - ‘Global Monitoring for Environment and Security (GMES): Challenges and Next Steps for the Space Component’ {COM(2009) 589 final} {SEC(2009) 1439} {SEC(2009) 1440}
Date: 2009-10-28
Institutions: European Commission
Subjects: EU programme, access to information, environmental monitoring, fact-finding mission, financing, impact study, information processing, international cooperation, public safety, satellite communications, space research

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 28.10.2009 
SEC(2009) 1441 

COMMISSION STAFF WORKING DOCUMENT 

SUMMARY OF THE IMPACT ASSESSMENT 

Accompanying document to the the  

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

‘Global Monitoring for Environment and Security (GMES):  
Challenges and Next Steps for the Space Component’ 

{COM(2009) 589 final} 
{SEC(2009) 1439} 
{SEC(2009) 1440} 

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SUMMARY OF THE IMPACT ASSESSMENT 

1. 

INTRODUCTION 

This  Impact  Assessment  accompanies  a  Commission  Communication  on  the  Space 
Component of Global Monitoring for Environment and Security (GMES). It was drawn up in 
consultation  with  a  steering  group  of  Commission  services,  following  a  wide-ranging 
stakeholder  consultation  carried  out  by  the  GMES  Bureau.  The  present  report  has  been 
analysed by the European Commission’s Impact Assessment Board and amended accordingly. 

GMES  is  an  Earth  observation  capacity  that  makes  it  possible  to  manage  natural  resources 
more  efficiently,  and  to  monitor  biodiversity  and  the  state  of  the  oceans  and  the  chemical 
composition of our atmosphere — important factors for climate change —, to respond better 
to natural and man-made disasters and to improve border surveillance.  

GMES comprises a service component and an observation infrastructure component, the latter 
consisting of a space infrastructure and in situ infrastructure. Benefits arise from the service 
component,  which  in  turn  depends  on  the  observation  data  coming  from  the  infrastructure. 
GMES  should  therefore  be  viewed  as  a  complete  system.  While  the  2008  Commission 
Communication  ‘GMES:  we  care  for  a  safer  planet’1  addressed  GMES  as  a  whole,  this 
present Communication zooms in on the Space component, with the aim of: (i) facilitating the 
co-decision  procedure  on  the  Commission  proposal  for  a  GMES  programme  and  its  initial 
operations  in  2011-20132  and  (ii)  preparing  the  ground  for  the  decisions  covering  the  next 
financial framework (post-2013). 

Space data constitute a key input into the GMES service component. If the flow of space data 
is  interrupted  or  cut  off,  certain  services  cannot  be  provided.  The  thematic  areas  within  the 
GMES  service  component  will  rely  on  access  to  data  from  existing  Earth  observation 
satellites owned by third parties3 and space infrastructure developed specifically for GMES. 
As the EU does not want to duplicate existing capacities in Europe, it was examined to which 
extent  the  user  requirements  compiled  by  the  EU  could  not  be  met  by  existing  or  planned 
infrastructure. 

This  gap  analysis  helped  to  define  the  content  of  the  ESA  GMES  Space  Component 
Programme, to which the EU contributes financially, and which is concerned with developing 
satellite missions known as ‘the Sentinels’. The first constellations of Sentinels are currently 
being developed by ESA and include seven satellites (the first two units of Sentinel 1 to 3, the 
first  two  units  of  Sentinel  4  and  the  Sentinel  5  precursor)  plus  two  instruments  to  be  flown 
onboard EUMETSAT satellites. 

1 
2 
3 

COM(2008) 748, 11.12.2008. 
COM(2009) 223, 20.5.2009. 
Including EU Member States, intergovernmental organisations such as ESA and EUMETSAT, non-EU 
countries and private entities. 

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2. 

PROBLEM DEFINITION 

Once  developed,  the  space  infrastructure  will  have  to  be  exploited  and,  in  due  course, 
renewed with a view to collecting the environmental data for the GMES service component. 
The problem addressed here is therefore how the following can be managed and financed: 

•  the exploitation of the initial constellations of Sentinels developed by ESA, after the end of 

the development phase, and 

•  renewing the Sentinels, many of which have a life span of around seven years, in parallel 
to  the  exploitation  mentioned  above,with  a  view  to  the  long-term  continuity  of  data 
collection. 

In  its  proposal  for  a  Regulation  on  the  GMES  Programme  and  its  initial  operations  2011-
20134,  the  Commission  proposed  that  the  overall  financial  envelope  for  GMES  initial 
operations  should  be  EUR  107  million,  40  million  of  which  being  for  exploiting  the  Space 
component. 

The  financing  and  management  of  the  exploitation  of  the  Sentinels  has  been  discussed  in  a 
number  of  documents,  including  the  Commission  Communication  ‘Global  monitoring  for 
Environment and Security (GMES): we care for a safer planet’5. While it is expected that a 
future  EU  Programme  should  contribute  to  the  sustainability  of  the  space  infrastructure, 
notably in terms of in-orbit availability and operations, no binding decisions on EU funding of 
Sentinels  exploitation  was  possible,  as  the  period  in  question  goes  beyond  the  current 
financial  framework.  A  decision  on  financing  the  space  component  therefore  needs  to  be 
prepared soon, as part of work on the next multiannual financial framework. 

ESA  Member  States  have  made  it  clear  that  the  Sentinel  infrastructure  represents  their 
contribution  to  the  GMES  Space  Component  and  that  their  financial  effort  is  made  on  the 
assumption  that  the  EU  will  take  over  responsibility  for  the  exploitation  and  renewal  over 
time  of  an  equivalent  infrastructure,  under  EU  funding.6  The  same  position  has  been  taken 
consistently by several EU Member States in the GMES Advisory Council, an experts’ group 
assisting the Commission in GMES development. It is thus unlikely that, in the absence of EU 
commitment,  an  organisation  other  than  the  EU  would  assume  responsibility  for  the  GSC 
beyond 2013. Consequently, the GMES service component as currently conceived would not 
be viable7. 

3. 

ANALYSIS OF SUBSIDIARITY 

The  EU  contribution  to  the  exploitation  and,  eventually,  renewing  the  space  infrastructure 
developed at European level is fully in line with the subsidiarity principle, for the following 
reason. The responsibility for the exploitation and possibly the renewal of space infrastructure 
developed  with  EU  and  intergovernmental  funds  cannot  be  sufficiently  achieved  by  the 

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COM(2009) 223, 20.5.2009. 
COM(2008) 748, 12.11.2008. 
See  e.g.  the  minutes  of  the  198th  meeting  of  the  ESA  Council  on  15  February  2008,  p.  4,  and  the 
minutes of the 203rd meeting of the ESA Council on 15 and 16 October 2008, p. 6. 
See also recital 12 of the proposal for a GMES Regulation. Although it would be possible to provide 
some  services  only  on  the  basis  of  in  situ  data,  or  data  from  missions  other  than  the  Sentinels,  such 
services would not be comparable any more to the thematic areas in the GMES service component. 

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Member States because of the costs incurred. It is precisely for this reason that in the field of 
space-based  observation  for  operational  meteorology,  European  States  have  pooled  their 
resources to develop and exploit meteorological satellites under the auspices of the European 
Organisation  for  the  Exploitation  of  Meteorological  Satellites  (EUMETSAT).  European 
States  have  also  developed  demonstrator  environmental  satellites  either  through  ESA  or 
through national space agencies. They found no way, though, of cooperating on the funding of 
sustained operational environmental monitoring programmes similar to those in meteorology. 
Nonetheless the need for such observations is becoming critical, given the increasing political 
pressure  for  public  authorities  to  take  informed  decisions  on  the  environment,  security  and 
climate change. 

4. 

EU OBJECTIVES 

The  specific  objectives  of  EU  action  relating  to  the  GMES  space  component  (i.e.  the 
Sentinels) are to: 

•  ensure the continuous availability of environmental data collected through a set of space-
based sensors as an input for the thematic areas in the GMES service component; through: 

–  the continuous exploitation of the Sentinels and accompanying research activities 

through adequate governance and financing structures; 

–  the  timely  definition,  development  and  procurement  actions  for  renewing  the 

Sentinels as necessary; 

•  stimulate, by lowering the costs of access to earth observation data, the growth of the Earth 
international 

innovation  and 

terms  of 

jobs, 

in 

Observation  downstream  sector 
competitiveness. 

5. 

POLICY OPTIONS 

The available policy options are as follows: 

•  Option 1:  Option  1  corresponds  to  the  baseline  scenario.  The  EU  would  not  assume 
responsibility for the exploitation of the Sentinels after the GMES initial operations (2011 
–  2013).  This  means  that  the  EU  would  not  exploit  the  GSC  at  all  beyond  2013.  As  no 
other entity would be willing to finance the totality of the Sentinel exploitation costs, no 
data collected through the Sentinels would be available for the GMES service component. 

•  Option 2:  The  EU  would  finance  and  manage  the  exploitation  only  of  the  first 
constellations of Sentinels, but not their renewal. No data from Sentinels will be available 
beyond the first constellation. 

•  Option 3:  The  EU  would  finance  and  manage  (i)  the  exploitation  of  the  initial 
constellations of Sentinels, and (ii) the renewal of space infrastructure to ensure sustained 
observation over time, given that most of the Sentinels currently developed have a nominal 
lifetime of seven years and that the thematic areas in the GMES service component rely on 
continuous  access  to  the  corresponding  data.  Decisions  on  renewal  will  have  to  be  taken 
while the initial constellations are in operation. 

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The  options  incorporate  a  number  of  assumptions.  First,  exploitation  activities  will  be 
accompanied by research activities. Secondly, access to data from existing Earth observation 
satellites owned by third parties is necessary. Thirdly, data produced by the Sentinels will be 
available under full and open access. Fourthly, no forms of co-financing are assessed for the 
GSC.  As  in  the  case  of  Galileo8  and  other  EU  infrastructure  programmes,  ownership  of  the 
Sentinels could be transferred to the EU at no cost, allowing the EU to impose for Sentinel 
data a full and  open access data and information  policy.  Nevertheless,  the  Commission  will 
continue  to  explore  whether  the  development  of  market  opportunities  and  cost-based  user 
charges might eventually enable the proportion of public investment to be reduced in the long 
run.  Generally  speaking,  the  potential  financial  effort  that  can  be  deployed  under  the  EU 
budget is not yet known, as priorities and allocations of funding under the new multiannual 
financial framework (beyond 2013) will come later. 

6. 

ANALYSIS OF IMPACTS 

Consistent with the focus of the proposed Communication, all options are based on variations 
in the Space component only, and assume that all other components do not vary. 

The  options  have  been  analysed  both  qualitatively  and  quantitatively.  For  the  quantitative 
part,  a  cost-benefit  analysis  was  based  on  available  data.  Benefits  arising  from  GMES  have 
been  quantified 
‘Socio-economic  benefits  analysis  of  GMES’  by 
PriceWaterhouseCoopers (the ‘PWC study)9. It sets out in monetary and present value terms 
the  projected  economic  benefits  (including  societal,  environmental  and  other  economic 
benefits)  with  respect  to  a  baseline  scenario  without  GMES.  In  the  PWC  study,  GMES 
benefits have been grouped into three high-level categories: 

the  study 

in 

•  Category  1:  efficiency  benefits  linked  to  the  use  of  GMES-related  information  in 
implementing or enforcing legislation or policies that are already in place. Nothing more 
than continuous availability of GMES services (and hence of the GSC) is needed for these 
benefits to materialise. 

•  Category 2: benefits linked to the availability of  more  and  better  information  during  the 
policy formulation stage. The result would be better policy making at European, national 
and  regional  level,  easier  and  more  efficient  implementation,  and  ultimately  improved 
delivery of policy objectives. There is however a built-in delay between the availability of 
information and the materialisation of the benefits, linked to the policy cycle.  

•  Category 3: as in category 2, but this time at global level, i.e. linked to the signature and 
implementation  of  international  treaties  (e.g.  on  climate  change,  desertification  and 
deforestation). As a consequence, there is a much bigger time-lag before they materialise, 
but  at  the  same  time  their  magnitude  is  much  greater  than  in  the  other  categories.  An 
example  of  this  category  is  the  contribution  that  GMES  will  make  to  climate  change-
related  policies,  through  long-term  data  series  on  such  parameters  as  sea  surface 
temperature, sea level rise and CO2 distribution. 

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9 

See Article 8 of Regulation (EC) No 683/2008 of the European Parliament and of the Council of 9 July 
2008  on  the  further  implementation  of  the  European  satellite  navigation  programmes  (EGNOS  and 
Galileo) (OJ L 196, 24.7.2008, p. 1). 
Available at http://esamultimedia.esa.int/docs/GMES/261006_GMES_D10_final.pdf. 

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On the cost side, the costs of both the service component and the space component were taken 
into  consideration.  The  latter  are  based  on  the  ESA  Long-term  scenario,  a  cost  assessment 
prepared by the ESA executive and recognised as a basis for cost estimations by the 6th Space 
Council10.  

In  quantitative  terms,  the  options  can  be  compared  most  easily  on  the  strength  of  their 
generated Net Present Values in the period under consideration — see the figure below11. 

NPV comparison among options
2009 prices

35.000,0 

30.000,0 

25.000,0 

20.000,0 

Million €

15.000,0 

10.000,0 

5.000,0 

-

-5.000,0 

2014

2015

2016

2017

2018

2019

2020

2021

Year

2022

2023

2024

2025

2026

2027

2028

2029

2030

Option 3

Option 2

Option 1 baseline

Option 1 baseline

Option 2

Option 3

Taking additional account of the impacts not included in the PWC study and therefore not in 
the above graph, the following comparison can be made (keeping in mind that costs refer to 
the GSC, while benefits arise from the whole GMES system):  

10 

11 

Council Resolution on ‘The contribution of space innovation and competitiveness in the context of the 
European Economic Recovery Plan, and further steps’ — 10500/09 of 29 May 2009. 
The figure shows, for each option, the cumulative net present value (in 2009) of a stream of payments 
and benefits starting in 2014 and ending in year X, where X can take on any value between 2014 and 
2030. 

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Effectiveness 

Efficiency 

Coherence 

Option 1 
(baseline) 

Does  not  achieve 
the 
of 
any 
objectives. 

Some (low) costs to achieve no benefits 
(storage of developed satellites). 

be 

Impact  on  the  EU 
however, 
budget, 
zero, 
would 
that 
which  means 
funds  would 
be 
available  for  other 
initiatives 
and 
programmes. 

Option 2  Achieves the 
objectives of 
provision of 
information services 
through sustainable 
infrastructure only 
for a limited period 
(up to 2020). Does 
not achieve 
objective related to 
sustainable 
downstream growth. 

Option 3  Achieves  all  policy 
objectives. 

€200m/year 

approximately 

An  EU  budget  contribution  to  the  GSC 
on 
of 
average in the next financial framework 
would  enable  benefits  of  between 
€400m  and  900m  per  year 
to  be 
achieved  until  2022.  After  2020, 
about 
benefits  would 
€130m/year,  approximately  equal 
to 
costs in the following period. 

drop 

to 

This  option  has  important  built-in  cost 
inefficiencies linked to the ‘stop-and-go 
approach’.  The  EU  would  not  benefit 
from  economies  of 
the 
production  of  recurrent  satellite  units, 
which are important in the space sector.  

scale 

in 

€430m/year 

approximately 

An  EU  budget  contribution  to  the  GSC 
of 
on 
average in the next financial framework 
would  enable  benefits  of  slightly  less 
than  €1bn/year  to  be  delivered  until 
2022, 
€5bn/year as of 2027.  

then  peaking  at  more 

than 

No benefits therefore no trade-offs. 
Strongly  inconsistent  with  earlier 
EU efforts to develop the GSC and 
with  the  positioning  of  the  EU 
within the global Earth Observation 
EU over the past 10 years. 

Would  be  coherent  only  in  the 
event  of  a  major  shift  of  policy 
priorities  in  the  EU,  i.e.  relegating 
climate 
citizens’ 
security down the political agenda. 

change 

and 

The impact on EU budget, although 
higher than in the baseline, is likely 
to 
limited 
be 
environmental 
economic 
benefits.  

offset 

and 

by 

coherence  would 

Policy 
be 
dependent  on  the  capacity  of  the 
EU and the rest of the European EO 
EU  to  bridge  the  gap  after  the 
lifetime of the first generation.  

Inconsistent  with  EU  declared 
ambitions  to  lead  in  the  climate 
change  arena  (in  any  event  climate 
change  will  necessitate  long-term 
monitoring activities).  

The longer-term investment,  higher 
than in the baseline, would generate 
positive 
in  political 
priority  areas,  such  as  climate 
change.  Consistent  with  political 
agenda and EU objectives. 

trade-offs 

Potential  for  strategic  benefits  for 
the EU as global player. 

budget 

requisite 

The 
and 
corresponding  shift  from  research 
to  operation  would  require  GMES 
to be included among the financing 
priorities  in  the  next  EU  financial 
framework 
imply 
corresponding  adjustments  in  other 
policy areas. 

and  might 

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7. 

MONITORING AND EVALUTION 

The Communication itself will not directly result in new activities being financed through the 
EU  budget  over  and  above  what  has  already  been  decided  or  proposed  through  FP7, 
preparatory  actions  and  GMES  initial  operations  up  to  2013.  Should  the  next  Commission 
choose  one  of  the  options  requiring  the  exploitation  of  the  Sentinels  post-2014,  the 
appropriate legislative proposal would be drawn up in line with applicable rules, in particular 
regarding  the  preparation  of  the  next  multiannual  financial  framework  and  impact 
assessments.  

In line with standard Commission practice, evaluation will be in three phases (ex ante, interim 
and ex post). The interim and ex post evaluation will assess whether the operational objectives 
are  being  /  have  been  met.  Additionally,  the  Commission  will  evaluate  the  progress  of 
exploitation activities before any major decision is taken, including the decision on renewing 
the  Sentinels.  This  decision  may  have  to  be  taken  before  the  start  of  one  or  more  financial 
frameworks due to the long development cycles for satellites. In each policy cycle, decisions 
will have to be informed by an update of the cost-benefit case for the various options and a 
broad stakeholders’ consultation on the effectiveness and usefulness of the system. 

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