Abstract-An onboard synthetic aperture radar (SAR) signaldata reduction algorithm called Flexible Block Adaptive Quantization (FBAQ) was developed in 1994 for the Advanced SAR (ASAR) on the ENVISAT satellite. This paper presents work done in a follow-on study that examined the impact of the datareduction algorithm on the accuracy of two digital elevation models (DEM) produced by using the technique of repeat-pass SAR interferometry. All three allowable data compression ratios were investigated to determine the maximum compression ratio appropriate for SAR interferometry. Based on the scenes studied in this paper, it was concluded that a reduction from 8 to 4-bits/sample was the maximum data reduction ratio appropriate for precision SAR interferometry, while 8 to 3-bits/sample and 8 to 2-bits/sample encoding were only appropriate for lessdemanding wide-swath applications.Index Terms-Block adaptive quantization, data compression, satellite interferometry.

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