Funding, Revenue, Governance Are Key Question Plaguing Galileo, Lawmakers Say

Remek’s report asks the EC to complete Galileo’s initial operating capacity of 18 satellites by 2014 to ensure it becomes the second global navigation satellite system constellation of reference for chip-makers, and to achieve full operating capacity of 27 satellites in order to reap all societal and economic benefits. There should be sufficient funding for research and development for GNSS and other measures in the future to spur development of GNSS-based products and services, it said. There also should be better awareness-raising of what the systems can do, the draft report said.

Satellite navigation should become a core element in the EC’s development of all other relevant policies, the draft said. Galileo needs long-term stability to minimize delays, costly redesigns and destabilization of the user base, it said. The draft urged the EC quickly to submit legislation on future service levels, financing and governance of the GNSS programs.

The EU is building a global satellite navigation system to make Europe independent from other such systems and to get a piece of this “tremendously growing world-wide high-tech” pie now dominated by the U.S., Remek wrote. As a second-generation system, Galileo will offer better accuracy, more resistance against multi-path reflections and interference, and, with global integrity and authentication, be different from the U.S.’s Global Positioning Service and Russia’s program, he said. Because Galileo is designed as a “civil system under civil control,” it guarantees service continuity, he said.

The EC has achieved several significant results so far, “but the financial picture is less positive,” the draft said. In-orbit validation and launching costs have jumped, and within the current budget, the EC expects the Galileo constellation to have only 18 satellites, it said. Achieving initial operational capability will allow early services such as search and rescue and public regulated services (PRS) to roll out, but not at full performance level, it said. As they deploy, user equipment compatible with Galileo could be distributed and applications broadened, it said. To fully exploit its advantages, Galileo must reach full operational capacity, which the EC said will cost another 1.9 billion euros ($2.6 billion), it said.

Another issue is the expected competition with U.S., Chinese, Russian and Japanese satellite navigation systems, the report said. Those countries have gotten stronger, and for Galileo to be the second GNSS of choice for chip manufacturers, its early services must be available soon and its future financing determined, the draft said. The mid-term review began a debate on Galileo’s funding after 2013. The key elements of the debate are how to finance its stability, what revenue it can be expected to bring in, who will bear the liability for critical safety applications, what intellectual property rights are implicated and how R&D will be paid for, the report said.

The draft doesn’t avoid certain doubts connected with the running of the program after 2014, Remek said at the committee meeting. It recognizes that where such technologies are concerned, sometimes the path is more important than the overall objective, he said. People may have concerns about the management of the project because there’s “no Mr. Galileo” responsible for overall oversight, but that’s true of all major EU projects, he said.

There are questions about how the EC came up with 1.9 billion euros figure, said Fiona Hall, of the U.K. and Alliance for Liberals and Democrats. She also asked for more information on whether potential damage from solar flares had been taken into account, and what will happen if the ongoing debate between the EU and China over spectrum interference isn’t resolved.

The EC has yet to produce a simple statement outlining the benefits and costs of a full Galileo system versus the current plan, and what it would cost to cancel the project, said Philippe Lamberts, of Belgium and the Greens/European Free Alliance. He also complained about a lack of clarity about whether the system will also have military uses. It’s not unethical to use it for military purposes, but if the EU is faced with a program whose costs are exploding, and which has military uses, why shouldn’t the military help defray expenses? he asked. This is “all under some shadow” and the fog needs to be lifted, he said.

EU bodies may want Galileo as a symbol of European independence, but it’s a costly one, Lamberts said. It’s unlikely the U.S. will downgrade the GPS system or that Europe will oppose the U.S., so such a symbol may not be worth the price, he said. “The whole equation is not on the table."

An EC representative offered to give lawmakers the data behind the funding calculation, subject to approval by governments. The EC is being cautious because the information has market value and could be used by companies to improve their bids, he said. As for military contributions, he said, the EC proposed a PRS. It’s up to individual governments to decide what the PRS can be used for, and that could include military services, he said. There is a regulation saying Galileo will be a civil system, but the EU may have to break through those boundaries, he said. Amendments to the draft report are due March 10, Remek said.