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This paper investigates terrain referenced navigation (TRN) system integrated with inertial navigation system (INS). TRN system estimates navigation information of an aircraft by using a terrain elevation database and radar altimeter measurements. We derive 15-state strapdown INS error kinematics equations to design fusion algorithm. A point mass filter (PMF) based on Bayesian estimation is applied to the terrain navigation and the output is yields by a minimum mean square error (MMSE) method. The output of the terrain navigation is integrated with the position of the INS by Kalman filter and the estimated INS error is feedback to the INS. Simulations are constructed to evaluate the proposed method and the results show that the navigation accuracy of the aircraft is improved through the TRN/INS integration technique.