Value of satellite-derived Earth Observation capabilities to the UK Government today and by 2020 (2018)

Overview

The report by London Economics, commissioned by Innovate UK, considers the current and near-term potential value of satellite-derived EO capabilities to the UK government for civil and domestic purposes. The subsequent value to industry as a supplier of EO data and applications to the UK government is also investigated.

 

Satellite-derived Earth Observation (EO) concerns the gathering of information about the planet’s physical, chemical and biological systems via satellite-based platforms. This information provides inputs into wider geospatial solutions for users across the public domain. The total spend on EO by government is significant – estimated at GBP 1.2 billion between 2014 and 2020, equivalent to annual average spending of GBP 175 million. The intention of this value study was to provide evidence for the co-ordination of EO exploitation across government.

 

The study estimated the annual economic value of EO across the nine specified domestic civil use cases in the UK in 2018, and the potential value by 2020. The case studies examined were: Agriculture, Atmosphere, Built Environment, Coastal, Forestry, Flooding, Maritime, Meteorology and Transport.

 

Value is presented in terms of what EO capabilities offer the government over alternative methods within the use cases. The value relates to operational cost savings, exceptional costs avoidance, better policy decisions and regulation, and catalytic benefits (to wider government, economy, and society) for the identified EO use. Evidence for the study was sourced from literature and consultations with more than 60 stakeholders. However, due to the constraints of this availability of evidence the authors emphasise that the true use, value and potential of satellite-derived EO within the UK government may be much greater than presented in the report.

 

Geographical scope

United Kingdom

Non-quantified impacts

The report highlights ongoing developments in EO data, application innovation and the emergence of other enabling technologies that are driving the potential for EO use and its associated value. Examples of advances in imagery include higher spatial and temporal resolution, multi/hyper-spectral images, increasing data frequency, video imaging, enhanced SAR capabilities, and improvements in atmospheric, weather, and climate data. Other developments in complementary EO data sources (e.g. drones) and technologies that will improve the storage, processing, analysis and application of EO data (e.g. cloud-based computing, big data analytics and artificial intelligence).

 

The study finds that UK innovation in EO-based applications is growing partly due to the free availability of Sentinel data. New commercial EO applications are being supported by research and development grants designed for use both in the UK and abroad.

 

The values associated with EO supporting better policy making and regulation, and enhancing operational productivity, are likely to be significant, but are not quantifiable.

Quantifiable impacts

A selection of key findings from the report are as follows:

 

  • Across the nine use cases examined, the predominant EO use by government is in Meteorology; this represents 90% of the current value derived, mostly driven by the catalytic benefits to the wider economy and society.
  • Aside from meteorology, this study reveals that present government use in the other eight areas examined is limited, variable and fragmented, if at all.
  • Government users tend to make use of Sentinel data and process it in-house whilst little commercial data and few civil applications are currently procured for operational use. From the sample of industry consulted, government EO use was found to support an estimated GBP 10 million per year of commercial revenue for data and application provision.
  • The study found that current use represented almost GBP 1 billion per year in value to government and indirect beneficiaries. Exceptional cost avoidance accounted for more than half of this (59%), followed by catalytic benefits to wider society (22%), and operational cost savings (19%). This estimate included GBP 64 million per year of direct value to government in terms of operational efficiency and exceptional cost avoidance.
  • The total value of satellite-derived Earth Observation for government applications across nine civil areas was forecast to reach GBP 1.2 billion per year by 2020. EO offers a value proposition that is not fully captured in these estimates by supporting the detection of change over large areas efficiently and often more cheaply than other methods employed by government.
  • The potential for EO use by 2020 represents a trebling in direct value (i.e., operational cost savings and exceptional cost avoidance) for UK government to £200 million. Additional direct value to be gained in 2020 includes: Agriculture (£18 million), Built Environment (£8 million), Coastal (£1 million), Forestry (£22 million), and Transport (£86 million).

Reference

Country

Study type

Desk-based research, Subject matter expert interviews, Case studies, Economic analysis

Economy sector

Infrastructure (Transport), Design and Construction, Maritime, Environment, Agriculture, Meteorology