Socio-economic benefits of satellite data

EUM/DG/VWG/14/770830, 23 September 20141

Alain RatierDirector-General

WMO / EUMETSAT Side-EventSocio-Economic Benefits of Satellites

EUMETSAT Meteorological Conference Geneva - 23 September 2014

Socio -Economic Benefits of Polar Satellite Data

2 EUM/DG/VWG/14/770830, 23 September 2014

The challenge: from observation to benefits

Slide: 2

Forecast & support to decision making

Observation

Numerical Prediction (ECMWF and NMSs)

Forecaster Expertise

Benefits from public and private decisions

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Methodology


Joining forces

• Socio-economic benefit study launched in 2011, updated in 2013

• Collaborative venture:

- Socio-Economic Benefits of forecasts: World Bank/Météo-France

- Impact of satellites on forecasts : ECMWF, UKMO, DWD

- Benefits attributable to satellites : All


Safety of life, property and infrastructure…

Transport … ...Climate policy and environment protection

….... ......

Benefits areas of weather forecasting

....Energy, agriculture,tourism....


Eyjafjallajökull Ash cloud from 7 to 11 May 2010(Second eruption)

Transports: impact on aviation


Energy sector


Focus on areas where benefits of forecast can be qu antified

• Areas where quantitative assessment of benefits exists, isdocumented by research and publications

• Protection of property and infrastructure (avoided costs)

• Direct added value to the European Economy

• Value of private Use by European Citizens

• Published socio-economic studies compiled, analysed andextrapolated by an economist of the World Bank

• Scope: European Union (EU 27)


Protection of Property & Infrastructure (avoided co sts)

• Forecast information integrated into warning/civil protection systems limits economic losses due to floods and storms• Floods in Europe cost on average €4Bn/year• Storms in Europe cost on average €2.6Bn/year

• Based on published information, likely annual benefit of forecast information in limiting EU losses due to floods and storms is €2.75Bn

• Publications suggest that forecasts of other severe phenomena (risk of forest fires, snow, heat-waves, cold spells, etc.) bring altogether benefits in the same order as for floods and storms

• Likely aggregate benefit is €5.5Bn/year


Direct Added Value to the EU Economy (Exc. private use)

• Forecasts widely used to optimize business/increase productivity:• Transport Sector:

• Air traffic management (e.g. reduction in weather-induced delays)• Route planning / optimisation• Road and rail network management, …..• Ship routing

• Energy Sector: demand estimation, supply/grid management….)

• Agriculture (planting, harvesting, use of fertilizers…)

• Leisure and tourism (demand planning)

• Construction (planning)

• Mining


Direct Added Value to the EU Economy… Ct’d

• About 1/3 of EU GDP is weather-sensitive, with some sectors particularly sensitive (e.g. transport and energy)

• Aviation sector alone contributes over €120Bn to European GDP, as well as being a vital infrastructure component for Europe

• Estimations available for added value of weather forecasts to weather-sensitive sectors of the EU economy

• Published studies show that forecast information yields at least “added value” of 0.25%: the benefit is at least €10.23Bn/year in the EU

• Published studies suggest that 1% is a more realistic value on average: the corresponding benefit is €41Bn/year


Value of Private Use by European Citizens

• A US study has indicated that private households in the US place a value of about US$280 / year on forecast information

• Assuming European households are prepared to pay €20/year (directly or through taxes), the aggregate benefit is €4Bn/year

• With a more likely value of €80/year for European households the benefit increases to 15Bn/year


� Not captured: value of hundreds of lives saved each year is not captured

� Also ignored: additional benefits of weather forecasts on specialised forecasts of weather-

dependent phenomena, i.e. air quality, marine forecasts, dispersion of pollution, etc.

Estimated benefits of weather forecast in the EU 27

BENEFIT AREA LIKELY

Protection of property and infrastructure €5.4 billion/year

Added value to the European economy €41.0 billion/year

Private use by European citizens €15.0 billion/year

TOTAL €61.5 billion/year


Impact of Metop Data on Forecasting

Parallel investigations undertaken to provide 3 different perspectiveson impact of EPS / Metop-SG on forecast accuracy:

Assessment of the relative contributions of the variousobservation sources to forecast accuracy (Met Office UK)

Statistical Impact on Forecast Accuracy using Data DenialExperiments (ECMWF)

Case Study on the Impact of Polar Data on the Forecasting ofWinter Storms over Europe (DWD)


Observations into models: « Assimilation » Constraining the initial model « trajectory »

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Model forecast without Model forecast without Model forecast without Model forecast without new observationsnew observationsnew observationsnew observations

«««« Real AtmosphereReal AtmosphereReal AtmosphereReal Atmosphere » » » »

timetimetimetime

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ObservationsObservationsObservationsObservations

Model ForecastModel ForecastModel ForecastModel Forecast

Error Error Error Error ReductionReductionReductionReduction

State of atmosphereState of atmosphereState of atmosphereState of atmosphere


Major impact of Metop -A on Day 1 forecast

24.5%

RELATIVE CONTRIBUTION

OF OBSERVATIONS TO

REDUCTION OF ERROR IN

DAY 1 NUMERICAL FORECAST

T0 + 24hT0 + 24hT0 + 24hT0 + 24h

Error Error Error Error ReductionReductionReductionReduction


ECMWF Data Denial Experiments


Beyond statistics, some cases matter more than others: ECMWF Forecasts of Sandy landfall

Slide: 18


• Winter storm “Nicolas”: 45 hour forecasts and operational analysis (best approximation of ground truth) of surface pressure (contour lines) and 10m wind speed (shaded areas – units M/S) for 7 February 2011

Beyond statistics, some cases matter more than others: DWD Forecasts of Nicolas winter storm


IMPACT OF METOP DATA ON FORECASTING – MAIN RESULTS

• Polar orbiting satellites account for more than 58% of the impact of allobservations on NWP forecasts

• Metop-A biggest individual contributor at around 25%, i.e. roughly 2.5 timesgreater than a fully functional spacecraft from a previous generation (i.e. NOAA-19)

• Loss of Metop data would lead to an 8% drop in forecast accuracy over Europe(assuming other components of the observing system remained in place)

• If Metop were the only polar orbiting meteorological spacecraft, its loss wouldresult in a 13% drop in forecast accuracy over Europe

• A 15-20% loss of forecast accuracy would result from the simultaneousunavailability of Metop and the US counterpart of the Initial Joint Polar System


� Value of hundreds of lives saved each year not captured

� Also ignored: additional benefits of weather forecasts on specialised forecasts of weather-

dependent phenomena, i.e. air quality, marine forecasts, dispersion of pollution, etc.

Benefits of forecast attributable to EPS/Metop

BENEFIT AREA LIKELY

Protection of property and infrastructure € 0.4 billion/year

Added value to the European economy € 3.3 billion/year

Private use by European citizens € 1.2 billion/year

TOTAL €4.9 billion/year

Most conservative forecast impact of 8% taken for calculating benefits


Benefit/cost ratio of EPS/Metop -SG Programme (€ 3 Bn )

BENEFIT AREA LIKELY

Protection of property and infrastructure € 6.0 billion

Added value to the European economy € 45.2billion

Private use by European citizens € 11.5 billion

TOTAL € 63 billion

Most conservative forecast impact of 8% assumed, as for EPS/Metop21 years of observation: 2020-2041

(2010 values, using discount rate of 4% and assuming GDP growth rate of 2%)

Benefit to cost ratio is in the order of 20


Possible drivers of future evolutions of benefits ( 1/2)

• Benefits attributable to Metop-SG may increase wrt Metop, as capabilities will be significantly enhanced

• Conceptually, relative impact should level if all satellites are equally capable

• Impact study for dual Metop, Suomi-NPP, FY3 of great interest

• Populating the “early morning” orbit with advanced satellites expected to have highest impact in the short term

• Improvements in absolute forecast accuracy will increase benefits, possibly massively of performance thresholds are exceeded

• Assessment is a challenge: socio-economic benefits are based on current forecast

• How to measure elasticity of benefits to forecast performance?


Impact of dual Metop operations


Possible drivers of future evolutions of benefits ( 2/2)

• Expectation of more frequent high-impact weather events in our changing climate, increasing further the “avoided costs”

• Increasing vulnerability/sensitiveness of society and economy (e.g. with the development of renewable energy) to weather

• ….but stagnant/slow economic growth will reduce benefits !

• Improved response of decision-making to forecasts and warnings

• Use of probabilistic forecast will make a difference

Science

Socio-economic benefits of satellite data