Assessing the value of information for water quality management in the North Sea

Global Earth Observation (GEO) is one of the most important sources of information for environmental resource management and disaster prevention. With budgets for GEO increasingly under pressure, it is becoming important to be able to quantify the returns to informational investments. For this, a clear analytical framework is lacking. By combining Bayesian decision theory with an empirical, stakeholder-oriented approach, this paper attempts to develop such a framework. The analysis focuses on the use of satellite observations for Dutch water quality management in the North Sea. Dutch water quality management currently relies on information from 'in situ' measurements but is considering extending and deepening its information base with satellite observations. To estimate returns to additional investments in satellite observation, we analyze the added value of an extended monitoring system for the management of eutrophication, potentially harmful algal blooms and suspended sediment and turbidity in the North Sea. First, we develop a model to make the potential contribution of information to welfare explicit. Second, we use this model to develop a questionnaire and interpret the results. The results indicate that the expected welfare impact of investing in satellite observation is positive, but that outcomes strongly depend on the accuracy of the information system and the range of informational benefits perceived. © 2008 Elsevier Ltd. All rights reserved.