The second of two test satellites designed to pave the way

for Europe’s Galileo satellite-navigation system –

and the first to carry a payload almost exactly like that of the spacecraft in the full 30-satellite Galileo constellation –

is scheduled to leave its contractor’s facility

Sept. 3 to be put through two months of final tests before a planned launch in December or January.

The satellite’s completion represents a rare concrete positive development in the Galileo program, whose future funding by the European Commission –

the executive arm of the 27-nation European Union –

will not be decided any earlier than

late this year, and probably not until early 2008, according to government and industry officials.

This funding uncertainty makes any estimate of the in-service date for the full Galileo constellation tentative at best. Officials say 2012-2013 is optimistic but technically feasible.

Two years behind schedule and over budget by an amount yet to be determined, the Giove-B satellite has completed its thermal-vacuum tests at a ThalesAlenia Space plant outside Rome and will spend the coming weeks at the Estec technology center in Noordwijk, Netherlands, owned by the European Space Agency (ESA).

Depending on the availability of the Russian Soyuz-Fregat rocket, Giove-B will be orbited in late December or in January from Russia’s BaikonurCosmodrome in Kazakhstan.

Assuming a launch around that time, Giove-B will be placed in medium

Earth orbit two years after Giove-A, a smaller, less-complex Galileo test satellite that was built by small-satellite specialist Surrey Satellite Technology Ltd. of Britain. Giove-A, launched in December 2005, was built for 28 million euros, or about $38 million at current exchange rates. Its on-time arrival permitted ESA and the 27-nation European Union to register its Galileo operating frequencies before its deadline expires.

-B was built by a contracting team called European Satellite Navigation Industries, which was formed under orders from European governments and includes Europe’s biggest satellite manufacturers: Astrium GmbH of Germany, Astrium Ltd. of Britain, Galileo

y Servicios of Spain, FinmeccanicaSpA of Italy and Thales Group of France, in addition to ThalesAlenia Space.

The Giove-B contract, like the contract for Giove-A, was signed in July 2003, but for 72.3 million euros. The satellite includes two types of atomic clocks –

a rubidium clock similar to the one carried by Giove-A, and a passive hydrogen maser clock that represents a new development in the field.

Giuseppe Viriglio, director of navigation and telecommunications programs at ESA, said Giove-B’s signal generator also differs from that of Giove-A. He said the satellite includes other elements that have been added as ESA and the contracting consortium fine-tune Galileo technical specifications.

In an Aug. 30 interview, Viriglio said the cost overrun for Giove-B has not been fully calculated but that it will be paid by both the contracting team and by ESA. The contractor and the customer share responsibility for the satellite’s two-year delay, he said.

The same contracting consortium that built Giove-B has signed a billion-euro contract with ESA to build much of the Galileo ground network as well as four more Galileo satellites. This contract is called Galileo’s In-Orbit Validation phase. It is being financed 50-50 by ESA and the European Commission.

For well over a year, the contracting team has been warning ESA and the commission that the evolving technical specifications for Galileo that ESA has insisted on will increase the price of the In-Orbit Validation phase. Current estimates are that completing the work package defined in the contract as modified will require another 400 million euros –

half from ESA, half from the commission.

declined to speculate on the amount of money that will be needed, but he said neither this issue nor the issue of future European Commission funding is slowing down work on the project.

The European Commission in June proposed that Galileo’s original business model, a public-private partnership, be scrapped in favor of all-public funding. This means the commission will need to find some 2 billion euros somewhere in its budget, or ask its governments to provide fresh cash, to build and launch the 26 satellites in the Galileo system, and

complete the ground network.

The commission is expected to submit

a report Sept. 19 to its governments that will be debated by European Union transport ministers

Oct. 2. Europe’s transport ministries are financing most of the commission’s Galileo spending.

Government and industry officials said the legal complexity of taking money from other European Commission budgets –

the farm-support program, called the Common Agricultural Policy, has been evoked as a source of Galileo funding –

means that no final decision on Galileo will be made before the end of the year at the earliest.

Also yet to be decided by ESA is whether its current industrial consortium should be granted the contract to complete the constellation, or should be broken up into two groups that would then compete for the work.

Introducing competition at the prime contractor’s level would raise political problems in Europe insofar as one industrial group would win, and the other would lose. Depending on the result, political authorities in Germany, Italy, France, Britain or Spain likely would protest.