According to GPS experts this move could eventually lead to the development of dual-system GPS/Galileo receivers that have greater accuracy, availability, continuity and integrity than single-band GPS receivers.
The 15 nations that make up the ESA approved the funding for Galileo at a ministerial meeting in Edinburgh. The European Commission is expected to provide matching funding for Galileo in December.
Under development since 1999, Galileo is designed to provide highly accurate navigation signals from a constellation of 30 satellites operating in the same frequency bands as GPS receivers. The ESA funding will cover the development and validation stage of the system, including the launch of a limited constellation of three satellites. The ESA estimates the total cost of Galileo at $2.6bn (£1.84bn).
Richard Langley, a professor in the Geodetic Research Laboratory at the University of New Brunswick, said plans tentatively call for Galileo to mesh with GPS frequencies to simplify the development of dual-system GPS/Galileo receivers and drive down prices.
GPS receivers are used in a wide variety of enterprise applications, including aircraft navigation, mining, truck-tracking, fleet management and surveying. Consumer GPS receivers used by hikers retail for as little as £139.
Dual-system receivers would not only provide greater positioning accuracy, said Langley, "but would also provide the three other key performance measures of a navigation system: availability, continuity and integrity". He added: "Use of a dial constellation will be particularly beneficial in situations where the performance of GPS alone is marginal, such as in urban canyons and other restricted environments".
Langley predicted that the cost of a dual-system receiver would not be much higher than that of a GPS-only receiver. Once Galileo became operational, he added, GPS-only receivers would be relegated to the technology junk heap.
The ESA plans to have the full Galileo constellation in operation by 2008.