Impacts of Space Weather on the Economy

(Examples below are taken from the Report of the Assessment Committee for the National Space Weather Program, June 2006.)

A more intense solar cycle means more solar storms will occur during the maximum period. Strong to severe storms can affect the following:

Examples of estimated dollar-amount impacts:

A solar storm in March 1989 cost two large utilities, Hydro Quebec in Canada and PSE&G in New Jersey an estimated $30 million in direct costs. Hydro Quebec spent $1.2 billion on installing devices to block storm-induced currents.

Between June 1, 2000 and Dec. 31, 2001, solar-initiated geomagnetic activity increased the wholesale price of electricity provided by one cross-state transmission system by approximately 3.7 %, or about $500 million.

One estimate claims that $500 million in satellite insurance claims from 1994 to 1999 was the direct or indirect result of space weather.

The DOD estimated in 2000 that disruptions to government satellites from space weather cost about $100 million a year.

Solar initiated geomagnetic storms in 1994 and 1997 appear to have caused the demise of three communications satellites with replacement costs estimated to be $600 million.

During high solar activity, polar airline routes are often diverted to lower latitudes to prevent loss of radio communications ad to avoid human exposure to increased solar radiation. Each flight can cost up to $100,000 for additional fuel, flight crews, and landings. Over the pole flights are increasing at a rapid rate.

Global positioning, navigation, and timing systems are playing a major role in daily operations of the economy. A 1% gain in continuity and availability of GPS alone is estimated to be worth $180 million a year.