The European Union (EU) will fall short in its financing of a global Earth observation system, and the European Space Agency (ESA) might have to scale down its own plans as a result, European government officials said.

More than four months after the government ministers who oversee ESA delivered a clear message of financial support for the joint program, called Global Monitoring for Environment and Security (GMES), the European Commission has been unable to win similar backing from different agencies of the same governments that make up ESA.

The size of the likely funding gap was made clear to government and industry officials attending a GMES conference April 19-20 in Graz, Austria. The meeting was held under the auspices of the Austrian government, which holds the European Union’s rotating presidency, and organized by the European Space Policy Institute, an ESA affiliate headquartered in Vienna.

GMES is envisioned as the second major ESA-European Union space endeavor after the Galileo satellite navigation project, now in development.

ESA and EU officials had agreed that GMES satellites and related development expenses would require about 2.3 billion euros ($2.8 billion) between 2007 and 2013. They further agreed that ESA and the EU should divide equally the financial sponsorship, as they do in Galileo.

That would mean that ESA and the EU would contribute, on average, some 165 million euros per year to GMES hardware development.

But in late 2005 the EU’s seven-year budget plan for research, home to most GMES financing at the EU, was stalled because of wider differences among member states about spending priorities.

The EU’s planned space budget, and with it the GMES investment, has been reduced along with the rest of research spending.

European government sources said Guenter Verheugen, the European Commission’s vice president and director for enterprise and industry, now is saying privately that the commission will have about 200 million euros per year to spend on space projects, of which 85 percent — or 170 million euros — would be spent on GMES hardware and services.

Marco Malacarne, head of the EU section that has charge of GMES under Verheugen, confirmed these figures April 20.

The EU had planned to spend much of its GMES investment in stimulating value-added services in environment, agriculture, border control, land and coastline monitoring and other areas.

“Our first priority is to invest in services, not hardware,” Malacarne said in an interview. “ESA assumes that 50 percent of GMES development costs will come from the commission. But that would use up the totality of our planned GMES budget. Obviously we have a problem here. We had planned to spend a minimum of 50 million euros per year on GMES services development, and hopefully a little more.”

Malacarne said the final EU spending figures should be confirmed by July, with the full seven-year research budget in place by the end of the year.

On ESA’s side, GMES has had less trouble in winning government financial support. ESA asked its governments in December for an initial 200 million euros for GMES, with the rest to come once the EU budget was known. ESA governments responded by oversubscribing by 26 percent.

“Have you seen any other program where someone asked for money for a publicly funded program and received 26 percent more than asked for? I have not seen this before,” ESA Director-General Jean-Jacques Dordain said in remarks prepared for the April 19-20 Graz conference. Dordain conceded that “the real test will come later” when the GMES budget rises into the billions of euros.

ESA governments subscribed to GMES on the assumption that the EU would commit to a 50-percent share of the program’s development costs. If the EU falls short, it may call into question the commitments made to ESA by its member governments.

Volker Liebig, ESA’s director for Earth observation, said ESA probably would be able to retain its current GMES plans even if it ends up paying slightly more than 50 percent. But in an April 20 interview he said it was unclear how unbalanced the ESA-EU roles could become before threatening the current GMES plans.

Buoyed by the support of its governments for GMES, ESA is preparing to solicit bids for three GMES satellites, called Sentinels, for launch starting at the end of the decade.

These plans may need to be put on hold if ESA’s GMES partner, the EU, turns out to be a junior partner. The EU, Dordain said, “holds the key in its hands on whether or not ESA will succeed in launching the Sentinels.”