Taming Inflation With an Off-Planet Supply Curve
Image credit: Katharina Kammermann on Unsplash
Abundant space energy and better data can blunt the shocks that drive prices
Inflation’s recent spike had familiar culprits: expensive energy and snarled supply chains. Global work from central banks and multilaterals converges on that diagnosis. The IMF’s 2025 study shows energy shocks were central to the 2021–22 surge and documents strong pass-through into prices; BIS assessments across 2023–24 describe the path back to stability as supply constraints faded and policy tightened; OECD tracking shows headline inflation easing through 2024 as food, energy and goods inflation fell even while services stayed sticky. If the disease is frequent, persistent supply shocks, then the cure is to reduce both their amplitude and their duration. A functional space economy does exactly that.
Energy first. Space-based solar power (SBSP) would provide dispatchable, weather-agnostic clean power, geographically decoupled from terrestrial chokepoints. NASA’s 2024 OTPS report doesn’t gloss over costs; it lays out specific capability gaps—autonomous assembly, in-space manufacturing, efficient power beaming—and shows how closing them brings SBSP closer to terrestrial cost ranges. ESA’s SOLARIS programme, in parallel, is stress-testing technical, regulatory and programmatic viability for a European path to demonstrations. If SBSP becomes a genuine baseload option, the macro effect is simple: fewer price spikes when gas pipelines, shipping lanes or weather systems misbehave—and a thinner pass-through into CPI.
Information next. Inflation accelerates when firms can’t see what’s coming—harvests, shipment delays, reservoir levels—so they build buffers and mark up prices. Satellite data helps remove that fog. The New York Fed’s Global Supply Chain Pressure Index (GSCPI) formalises the link between logistics stress and prices; research summarised by VoxEU finds supply-chain pressure shocks dominated euro-area core inflation in early 2022, with persistent effects. When you wire Earth-observation (EO), satellite communications and PNT into logistics, agriculture and energy dispatch, uncertainty shrinks. Copernicus case studies and ESA summaries document tangible productivity and risk-reduction benefits across sectors, while European Centre for Medium-Range Weather Forecasts’ (ECMWF) ERA5 reanalysis is now a default input for everything from crop modelling to wind-farm operations. Fewer surprises mean fewer precautionary price hikes and leaner inventories.
What does a policy stack look like if the aim is to hard-wire this “off-planet supply curve” into anti-inflation strategy?
Industrial policy should fund SBSP pilots with standardised rectennas and clear safety envelopes; simultaneously, public procurement should buy EO services for explicit price-stability use-cases (food, energy, transport), rewarding forecast-error reductions rather than raw imagery.
Regulation must set beam-safety and spectrum rules for SBSP and enforce debris-mitigation (insurance-backed bonds help internalise externalities) while keeping satellite interfaces open so new entrants can supply data into logistics and energy markets.
Monetary and fiscal policy should keep their core mandates—credible inflation targets and debt sustainability—while adding automatic stabilisers that channel part of SBSP royalties into temporary energy rebates when fuel shocks strike (similar to the measured impact OECD countries saw from targeted price measures during 2022).
Consider a very near-term scenario. A shipping disruption pushes the New York Fed index higher; EO-driven routing moves cargo earlier; grid operators adjust dispatch using skill-scored weather ensembles; food importers hedge with fresher crop condition data; and an SBSP pilot tops up peak power. The inflation spike that might have lasted four quarters decays in two. It’s not that prices never rise; it’s that they stop spiralling.
This is not an argument to replace central banking with satellites. It’s an argument to pair monetary credibility with a supply-side programme that sharply reduces the economy’s exposure to the shocks that matter most. Build space energy that doesn’t care about the weather, and build space data pipes that make supply chains legible. Do both well, and inflation becomes rarer, shallower and shorter—not eliminated, but domesticated.
