Measuring the Value of Earth Observation Information with the Gravity Research and Climate Experiment (GRACE) Satellite

Abstract:

Determining how much to invest in earth observation technology depends in part on the value of information (VOI) that can be derived from the observations. We design a framework and then evaluate the value-in-use of the NASA Gravity Research and Climate Experiment (GRACE) for regional water use and reliability in the presence of drought. As a technology that allows measurement of water storage, the GRACE Data Assimilation System (DAS) provides information that is qualitatively different from that generated by other water data sources. It provides a global, reproducible grid of changes in surface and subsurface water resources on a frequent and regular basis. Major damages from recent events such as the 2012 Midwest drought and the ongoing drought in California motivate the need to understand the VOI from remotely sensed data such as that derived from GRACE DAS.

Our conceptual framework models a dynamic risk management problem in agriculture. We base the framework on information from stakeholders and subject experts. The economic case for GRACE DAS involves providing better water availability information. In the model, individuals have a “willingness to pay” (wtp) for GRACE DAS – essentially, wtp is an expression of savings in reduced agricultural input costs and for costs that are influenced by regional policy decisions. Our hypothesis is that improvements in decision making can be achieved with GRACE DAS measurements of water storage relative to data collected from groundwater monitoring wells and soil moisture monitors that would be relied on in the absence of GRACE DAS. The VOI is estimated as a comparison of outcomes.

The California wine grape industry has features that allow it to be a good case study and a basis for extrapolation to other economic sectors. We model water use in this sector as a sequential decision highlighting the attributes of GRACE DAS input as information for within-season production decisions as well as for longer-term water reliability.