Amplifying the global value of Earth Observation (2024)
Overview
This study by the World Economic Forum (WEF), in collaboration with Deloitte, examines the global potential value of Earth Observation (EO) in both economic and environmental terms.
EO involves gathering information about the Earth’s surface, waters and atmosphere via both satellite remote sensing platforms and ground-based “in situ” data sources. This study primarily focuses on remote sensing as it is a driving force for scaling EO around the world. In-situ data is considered when it is used to support remote sensing data or when it cannot be differentiated from it.
EO data has contributed to the global economy for decades. Initially underpinned by strong public sector contributions (particularly driven by defence and security interests), there is now an established and growing commercial EO industry. The report references that between 2021 and 2023, the EO industry grew by more than 21% (derived from the European Union Agency for the Space Programme (EUSPA) market reports of 2022 and 2024).
EO enables better decision-making by providing better data. In economic terms, the use of this data can increase productivity and reduce costs which yields economic benefit. Businesses can develop innovative solutions and increase efficiency that brings about competitive advantage.
The majority of EO’s value comes in the form of downstream industry applications. EO applications can be found in nearly every industry, sector and region. The study finds that the potential for each industry to extract value from Earth data is strongly linked to technology readiness as well as their global size and future growth profile. Tech-ready industries have the potential to grow EO data’s value the fastest, whereas traditional industries have the most value to gain overall.
The study finds that increasing uptake of EO across all regions and industries is key to unlocking its economic and environmental benefits. The report offers strategies to help address barriers to adoption such as limited awareness of EO applications, a shortage of specialists, fragmented standards and difficulties in navigating the complex EO marketplace.
Geographical scope
Non-quantified impacts
The report explains how EO can play a role in supporting organisations to advance climate and nature goals through:
- verifying carbon reduction
- understanding organisations’ impacts and dependencies on nature
- identifying strategies that contribute to a nature-positive and net-zero economy
The study highlights that applications for business goals and environmental goals are not mutually exclusive and often go hand-in-hand. By activating the economic co-benefits of dual value applications for environmental monitoring, vulnerability analysis and supply chain monitoring the climate and nature impact of EO can be amplified.
Quantifiable impacts
Regional growth story visualisation
Source: Deloitte/World Economic Forum
The study finds that with encouraging market trends and hundreds of possible applications, the global potential of EO is immense, but the extent of this potential has not yet been realised. It estimates the potential value-added from EO data at USD 266 billion (nominal US dollars are used throughout the report) in 2023, a figure that is poised to grow to more than USD 700 billion in 2030 with a cumulative USD 3.8 trillion contribution to global gross domestic product between 2023-2030. Most of that value comes from downstream applications in industry; approximately 94% of the total value possible by 2030 derives from applications in agriculture, electricity and utilities, government, public and emergency services, insurance and financial services, mining, oil and gas, and supply chain and transport.
EO can also support initiatives that generate environmental benefits. It is a critical tool to inform policies, decisions and interventions that could eliminate up to 2 gigatonnes of greenhouse gas emissions every year while supporting a host of nature-positive strategies. The report highlights that this figure is likely to be an underestimate, as it only considers five leading EO applications with a demonstrated direct impact on GHG emissions, while numerous others exist with indirect effects. However, it still equates to approximately 3.6% of annual global emissions today (according to the United Nations Environment Programme’s, Emissions Gap Report 2023).
Potential global economic value from EO data, by industry, in 2030 (USD billions).
Source: Deloitte/World Economic Forum
Earth observation’s 6 key industries
Applications in six key industries are responsible for 94% of Earth observation’s total value possible by 2030.
- Agriculture
The uses of EO data in the agriculture industry are expansive with applications used in areas such as cropping, timber, livestock and fisheries. Remote sensing and in-situ data allow for better informed decisions for modern processes in farming at optimal times. This insight can also reduce up to 27 megatons (Mt) of GHG emissions annually from fertilizers.
- Electricity and utilities
The early adopters of EO in the energy and utilities industry have gained an information advantage in areas that span from site selection to management of transmission infrastructure. Applications for renewables, like forecasting energy potential for new solar, wind and hydropower sites, emerge as key enablers to the expected proliferation of renewable energy this decade.
- Government, public and emergency services
Earth observation was initially government-led and applications for public and emergency services are relatively robust. Accurate modelling of hazards and near real-time monitoring of structures, land and vegetation allow for better disaster preparedness and response. As natural disasters (e.g., floods, wildfires, hurricanes) become more frequent, EO provides a vital tool to protect human lives and capital stock. In the context of wildfires, early warning applications can help eliminate up to 64Mt of GHG emissions per year.
- Insurance and financial services
Insurance companies can use EO data to better assess risk, offer parametric insurance products and find efficiencies in assessing claims. The technology also plays a key role in sustainable finance by enabling independent verification sustainable practices. Financial services and insurance industries can use Earth data to better assess and manage their exposure to risks brought about by biodiversity loss and climate change.
- Mining, oil and gas
EO’s ability to remotely monitor oil and gas extraction and transmission brings both economic and environmental benefits. Using specialized sensors, companies can predict potential damage and quickly detect leaks when they occur. Faster remediation can help limit leaks which not only avoids product losses but can also reduce GHG emissions by as much as 1.7 Gt per year. International Energy Agency estimates that oil and gas companies can use EO to reduce almost 45% of methane emissions from oil and gas operations at no net cost.
- Supply chain and transportation
EO enables traceable supply chain insights for an increasing number of companies focused on ethical sourcing. Companies can not only track physical goods within their own downstream supply chain operations but also upstream in the supply chains of their vendors. As consumers and regulators exert pressure on markets to ethically source products, EO can provide a valuable tool to plan and monitor interventions.
Reference
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- Global