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EPOS financial plan status 2013

EPOS financial plan status 2013. EPOS IAPC Rome, 19 th of September 2013. Financial. pending challenges/activities Distributed ICS cost assessment Existing TCS cost assessment Identification of costs for planned TCS F unding scenarios Finalization of Financial Plan. consolidated issues

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EPOS financial plan status 2013

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  1. EPOS financial plan status 2013 EPOS IAPC Rome, 19th of September 2013

  2. Financial pending challenges/activities • Distributed ICS cost assessment • Existing TCS cost assessment • Identification of costs for planned TCS • Funding scenarios • Finalization of Financial Plan consolidated issues • National RIs cost assessment • ICS Central Hub cost assessment

  3. Objectives • To present the revised cost assessment of the different EPOS components • To provide scenarios for a funding model • To discuss the options and identify the most suitable one • To receive feedback from the IAPC to submit IAPC recommendations to the BGR

  4. Presentation • Timeline • Challenges for the Financial Plan • Cost assessment • Scenarios • Funding model • Discussion

  5. Timeline and goals Elaborate EPOS financial plan Phase 2 2014 2015 2019 Post-Prep phase? Preparatory Phase Phase 1: Implementation Phase 2: Construction & Operation EPOS-ERIC EPOS financial plan 2015-2019 Finalize the ICS design Present ICS prototype Identify existing TCS Start implementing TCS Hosting the ECO Procedures for hosting ICS Finalize EPOS financial plan Secure National funds for existing TCS Construction ICS central hub TCS implementation Existing TCS operational ERIC enters in force ECO operational ERIC-TCS Agreements Operate EPOS-ERIC Support TCS implementation EPOS fully operational Further TCS developed Third parties partnership agreements Interaction with private sector Finalise ERIC negociations

  6. Post-Preparatory Phase • An interim phase is needed before construction • Objective: make the bridge between the end of EPOS PP and the start of Phase 1/beginning of EPOS-ERIC (ie. Negotiations with the EC) • Not very costly. We are likely to need some dedicated national project and/or we might ask for a one year extension of the PP

  7. Financial plan in 2 phases? Short term (Phase 1): It is not possible to immediately legally integrate existing TCS into EPOS-ERIC. New TCS are not sufficiently defined to start construction immediately. Different financial scenarios to be presented Long term (from Phase 2 onwards): legalintegration of TCS into EPOS-ERIC when possible, also in the financial plan If the IAPC agrees with this two-step approach, this has important implications for legal, governance and financial issues: • The legal and governance must be able to accommodate constraints from Phase 1 and Phase 2 • The financial plan is developed for Phase 1, with a review process at the end of Phase 1

  8. Phase 1: challenges to address GENERAL • EU funding is not guaranteed • Members will join the EPOS ERIC progressively – allow for non-ERIC member financial participation (must be taken into account in governance structure) • Some TCS services will be shared also with non EU and EU associate countries CONCERNING ICS • Provide costs for distributed ICS • Revise the ICS cost assessment for the central hub CONCERNING TCS • Existing TCS cost assesment to be provided (ongoing; October 2013) • TCS to define or being planned: provide approximate costs • Maintaining existing services • Project funding for (new) services such as I3 necessary

  9. Cost assessment: Phase 1 • First 5 years of EPOS-ERIC (based on average personnel costs) • ECO: € 3.750.000 • ICS Central Hub: € 7.775.000 & Distributed Nodes: being assessed • EPOS Delivery Framework (outside EPOS-ERIC) • Existing TCS: being assessed • TCS under implementation: being assessed • Envisioned TCS (to be assessed later, when technically defined) First 5 years of ECO+ICS central hub: 11.5M€ over 5 years (2.6% of 420M) National RIs: 84M€ /year (=420 M€ over 5 years)

  10. WG1 TCS - Seismological Observatories & RIs *) SISMOS comment: SISMOS currently employs 16 technicians with a total of 176 man-month/year (this makes the bulk of the FTEs) **) EFEHR comment: current FTEs include more 'integration' than foreseen for stable operation - will reduce to 2.5 FTE + 16 kEUR resources "operation&maintenance" at the end of NERA ONGOING

  11. WG4 TCS - GNSS AND OTHER GEODETIC DATA (services under development) ONGOING

  12. Scenarios for EPOS-ERIC budget Phase 1

  13. EPOS Funding model EPOS-ERIC funding will be distributed over: • Membership fees : total of cash and in-kind cash equivalent • Recommendation IAPC June 2013: mixed model based on flat rate and GDP weighting. • Discussion: definition of the level of flat rate and GDP • Host Premium • No threshold is settled, it will depend on the proposals • EU and other project funding Membership fees: • Cash : • Define the minimum amount of cash necessary • In kind cash equivalent • Discussion: list of accepted In-Kind-Contributions and how to set their value

  14. Funding Scenarios EPOS-ERIC budget ECO ICS TCS National RIs National funding to EPOS ERIC Nat’lfundingaccording to nat’lpriorities EU funding EU funding Others Others Towardslessintegration (decoupled scenario) Towards more integration (Highlyintegrated scenario)

  15. Phase 1 funding sources: De-coupled scenario EPOS-ERIC budget ECO ICS TCS Membershipfees (cash) National funding to EPOS New funding Host Premium (mixed) In kind contributions EU funding EPOS coordination projects ( e.g I3, structural funds, …) Potential project funding Other EU projects (e.g. structural funds, InterReg…) National fundingatnat’llevel Services subscriptionfee Existing funding National projects and support

  16. Phase 1 funding sources: Moderately integrated scenario EPOS-ERIC budget ECO ICS TCS NB. Flexible fund for TCS, Moderatelyintegrated scenario Membershipfees (cash) National funding to EPOS New funding Host Premium (mixed) In kind contributions EU funding EPOS coordination projects ( e.g I3, structural funds, …) Potential project funding Other EU projects (e.g. structural funds, InterReg…) National fundingatnat’llevel Services subscriptionfee Existing funding National projects and support

  17. Phase 1 funding sources: Highly Integrated scenario EPOS-ERIC budget ECO ICS TCS Membershipfees (cash) National funding to EPOS New funding Host Premium (mixed) Evaluation? In kind contributions EU funding EPOS coordination projects ( e.g I3, structural funds, …) Potential project funding Other EU projects National fundingatnat’llevel Services subscriptionfee Existing funding National projects

  18. Moderately Integrated financial scenario SUFFICIENT FUNDING • Support for development, adaptation and operation of existing TCS • Support for construction of well defined, new TCS • Seed for definition of TCS still in definition phase FLEXIBLE FUNDING • Efficiency of spending • Adapt to evolving landscape • Adapt to distributed system POSSIBLE SOLUTION: BUILD TCS FLEXIBLE FUND • Growth over 4 years, stability in year 5 where the new financial plan is developed • Annual calls for developing TCS

  19. Scenarios for EPOS-ERIC budget Phase 1: legal, governance and financial implications

  20. Scenarios for EPOS-ERIC budget Phase 1: pros & cons

  21. Concluding remarks • EPOS needs a very flexible financial plan over the first 5 years (Phase 1) • If the fundingis not sufficient, wewillbuild administrative complexitywith no real service to scientists • The financialchoices carry implication for the legal and governancemodels

  22. IAPC indications on finances in Potsdam The EPOS PP IAPC provides to the EPOS BGR the following indications: • The EPOS PP IAPC agrees to leave the Host Premium not specified • The EPOS PP IAPC agrees that EPOS-ERIC needs cash contribution (to be determined) • The EPOS PP IAPC recommends the EPOS Project Development Board to provide a list of possible types of in-kind contributions for ICS and TCS envisioned at this stage of the Preparatory Phase and to transmit them to the BGR for discussion. • The EPOS PP IAPC agrees to exclude the flat rate per country and to provide to BGR two examples relying on models for membership fees: GDP-based and mixed

  23. Vote • Does the IAPC approve to have separate financial plans for Phase 1 and Phase 2? • Does the IAPC approve the presentation of the three funding scenarios by the PDB to the BGR? • Does the IAPC wish to recommend one scenario to the BGR? • In case the Moderately Integrated scenario is recommended: Does the IAPC recommends to use a flexible EPOS fund mechanism for TCS development?

  24. Discussing In-kind contributions Does the IAPC recommends to the BGR to discuss the following two issues? • Discussion: Accepted kinds of in-kind contributions? • Discussion: How to set value on in-kind contributions?

  25. Thank you for your attention!

  26. Accepted types of In-Kind Contributions?

  27. Options to include in-kind contributionsPros & Cons of linking IKC and Membership Fees

  28. How to set value on In-Kind Contributions? • To agree on flat rates per item of in-kind contribution provided • How to accommodate the specificities of each in-kind contribution in a fair system? • Provenance taken into account (i.e. for personnel)? • Insert it into the model bygranting a discount to the membership fee

  29. EPOS ERIC Cost distribution for each scenario Cost spread over time De-coupled Scenario Cost spread over time Moderately Integrated Scenario Cost spread over time Highly Integrated Scenario ? ? ? ? ? ? = being assessed

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