With mounting costs and sophistication in a constrained budgetary environment, designing, prioritizing and selecting earth observing systems (EOS s) demands a tighter coupling between science and…

This federal contract award, identified as NNX17AD55G, was granted by the National Aeronautics and Space Administration (NASA) to Resources for the Future, Inc., a non-profit research organization. The contract, valued at $468,641.00, is focused on developing and disseminating economic valuation techniques based on the Value of Information (VOI) and Real Options Value to inform strategic programmatic decisions regarding the scope and design of NASA's Earth Observing Systems (EOS). This work aims to quantify the economic value of climate science information and help the nation better understand the value of its investment in a rigorous long-term climate observing system. The contract is part of NASA's Earth Science Division's efforts to tighten the coupling between science and economics in the design and prioritization of Earth observing systems, as described in the National Research Council's recent Continuity Report. This contract does not have a set-aside designation and is a grant for research, with a completion date of December 20, 2019.

With mounting costs and sophistication in a constrained budgetary environment, designing, prioritizing and selecting earth observing systems (EOS s) demands a tighter coupling between science and economics. In 2013 NASA s earth science division (ESD) requested an ad hoc committee of the national research council (NRC) to establish methodologies and/or metrics that NASA can use to inform strategic programmatic decisions regarding the scope and design of its observation and processing systems. The national academy s recent continuity report sketches the evolving landscape in designing EOS s. This report states: narrowing uncertainty in climate sensitivity a factor of 2 will require reducing the uncertainty in SW CRF trends a factor of 2 below the range shown for CMIP3. The record length required to achieve this uncertainty level varies from 75 years for modis accuracy, to 50 years for ceres accuracy, to 23 years with clarreo used as an orbiting reference calibration for ceres, and 19 years for a perfect observing system. The economic impact of advancing knowledge of climate sensitivity by 20 years has been estimated to be on the order of $12 trillion U.S. Dollars for the global economy (cooke ET AL., 2014). To first order, this study found that the economic value was directly proportional to the number of years that information could be advanced (p.73). The cited study (cooke ET AL 2014) and a follow-on study (cooke ET AL 2015) compute a value of information (VOI), not for abstract hypothetical learning but for concrete EOS s. Weatherhead and wielicki (2015) note that this type of study differs substantially from past efforts in weather and seasonal to inter-annual prediction. Further development of such studies would help the nation better understand the value of its investment in a rigorous long term climate observing system along with the analysis and climate prediction research required to take advantage of such a system for improved societal decisions relative to climate change (weatherhead and wielicki, p. 16). This proposal aims to promote the development and dissemination of economic valuation techniques based on VOI and real options value. Section 2 is a report on the previous phase of this work, on which the above mentioned publications are based. Section 3 describes work envisioned for the next phase.