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No Free Launches: Can Commercial Space Bank On NASA Contracts?

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Image by Getty Images Europe via @daylife

Now that the Space Shuttle has been scuttled and the proposed Ares I Constellation program rocket has been cancelled, NASA has little near-term choice but to rely on the private sector for home-grown astronaut launch and return. And although several companies are intent upon providing those services, American crews may continue to depend upon Russian taxi rides for some time to come.

There are two principal issues. First, uncertain budgets and launch market commitments make NASA an unreliable customer, causing large R&D investments to be very risky. Second, working with NASA imposes contract complexities, schedule delays and added costs that jeopardize business viability. This is particularly true in regard to design control over manned mission flight safety provisions.

The original premise was that private industry can build and operate space transportation vehicles more rapidly, cheaply and flexibly than can government, opening a new era of spaceflight. But the big rub is that while this may be very true, they cannot do so the “government way”.  Accordingly, companies are reportedly pushing back against NASA rules establishing how their vehicles must be designed rather than how they must perform. This is analogous to authorizing the Federal Aeronautics Administration to certify the design of airplanes- not just certifying their airworthiness.

Blaming budget uncertainties, NASA has announced that it will postpone their use of private launchers for transporting astronauts until at least 2017. This delay has prompted one prospective customer, Bigelow Aerospace, to lay off 40 of its 90-person staff. The company which plans to operate an orbital habitat or “hotel”, was depending on commercial launch services to ferry users to and from the facility.  Bigelow has already placed two reduced-scale inflatable structured prototypes in orbit using Russian rockets, and had hoped to be operational with the real McCoy by 2015.

Although the White House had originally requested more than $800 million annually to support private space taxis, Congressional lawmakers reduced that amount by half. This can be attributed in part to a somewhat tense relationship that has existed between the Obama administration and Congress over space policy for some time. This contention became worse when the White House added more money to the fiscal 2012 budget request for commercial-crew efforts than was authorized in 2011… and less for NASA’s development of its own rocket and capsule for missions beyond Earth’s orbit.

NASA has now shifted to what they regard to be more flexible cost-sharing arrangements with private service suppliers Termed the “Commercial Crew Integrated Design Contract” (CCIDC), this strategy will modify so-called “Space Act Agreement” funding terms applied in the past to partner with proposed ventures involving Boeing, Orbital Sciences Corp and Space Exploration Technologies Corp. The change will focus upon overall design of the system, rather than on single technological activities and milestones.

Bill Gerstenmaier, who heads NASA’s manned program operations, noted that Congress has attached some strings that could further reduce the budget for commercial rocket development by linking such dollars to the agency’s progress in developing a separate, larger NASA rocket, a development  that will also limit NASA’s engineering and design control over the commercial program.  The downside, he said is that it “doesn’t ensure that we will get exactly what we need.”

Gerstenmaier estimates that “Based on our previous work, there is a pretty good possibility” that the new acquisition strategy will support at least two contractor teams to finalize and verify their designs. However Congressman Ralph Hall (Rep. TX.), who heads the House Science, Space and Technology Committee, expressed skepticism. He said “Given current federal budget constraints, I continue to be concerned about NASA’s ability to afford contracting with two or more companies to ferry our astronauts to and from the International Space Station.” Instead, Hall favors having two companies team together to jointly develop a more cost-effective plan. Yet he agrees with Bill Gerstenmaier that “NASA cannot impose its safety requirements as would be possible under a normal acquisition.”

Phil McAlister, NASA’s commercial spaceflight director, argues that CCIDC terms will paint a big picture of what it wants, allowing companies to set their own maps of how to get there. Supposedly this approach will streamline the process and greatly reduce paperwork expenses and headaches, such as reams of certified pricing data stating exactly how much everything will cost.

One likely contender, the planned six orbital passenger SpaceDev “Dream Chaser” taxi owned by Sierra Nevada Corp., has asked for speedy NASA decisions. Their chairman and executive vice president Mark Sirangelo told Popular Mechanics, “When we have to make decisions critical to the timeline, we want a clear path so it doesn’t linger for months.” In 2010 SpaceDev received a $20 million NASA award to advance vehicle development. It reportedly could be ready for launch aboard United Launch Alliance’s Atlas V and Delta IV rockets by 2014.

Last December Allen announced plans to build the world’s largest airplane powered by six Boeing 747 engines as a flying platform to launch rockets into the Earth’s orbit. Dubbed the “Stratolaunch”, the proposed privately-funded 385 foot wingspan and twin fuselage composite material craft was designed by a team at Scaled Composites. It was originally planned to be put into operation by 2016. Corporate business goals are to launch small communications satellites, sponsor space tourism, and support various NASA and Department of Defense uses.

The Stratolaunch Systems spaceship and booster will be provided by PayPal tycoon Elon Musk, whose SpaceX firm built and successfully tested the rocket. Allen told Florida Today that “…prices would be competitive, at least compared to roughly $60 million per seat NASA is paying to fly on Russian spacecraft.”

Space Exploration Technologies (SpaceX) founder Elon Musk is pleased that NASA’s commercial launch Space Grant Agreement is being revised to streamline the process. During a maiden flight of an un-crewed vehicle in December 2011, its reusable “Dragon” vehicle became the first commercially built and operated spacecraft to successfully achieve orbit and land. NASA subsequently awarded SpaceX a Commercial Crew Development astronaut transportation contract in April 2011 which will provide for a blunt-nosed Dragon capsule designed to carry up to seven astronauts, or a mixture of personnel and cargo, to and from the International Space Station (ISS) atop a SpaceX Falcon 9 booster.  

However for the time being, NASA’s only manned option is to negotiate a contract extension in the 2013 timeframe to ensure additional Russian Soyuz flights. This assumes that Congress will grant a waiver to the Iran, North Korea and Syria Nonproliferation Act that will otherwise block the agency from purchasing Russian hi-tech services. Incidentally, the Soyuz has never been certified for human spaceflight by NASA, a requirement that all commercial manned spacecraft must meet.

The final test for all commercial space venture investments must assess the bottom line on business risk versus justifiable and sustainable investment profits. This remains a huge issue since NASA is not able to issue service contracts which guarantee that companies meeting human rated or even cargo spacecraft requirements will actually be awarded jobs servicing American ISS needs. As observed by SpaceDev’s Mark Sirangelo, “If there’s no service contract at the end of the day, we’ll have a shiny vehicle that has nowhere to go. Then what is it that we just worked on?”

As Apollo 7 astronaut Walter Cunningham commented to me, “…there can be no such thing as truly commercial space until private investors are willing to put up the capital and are able to get a return on their investment. That means there has to be commercially viable ‘products’ that will provide rewards commensurate with the risk involved.  With the exception of communication satellites, I am aware of no commercially viable space-based products/services. In that vacuum, dreamers and inexperienced optimists have dreamed up a variety of so-called space opportunities, including flying passengers into orbit for profit.” He went on to say “The only way a so-called ‘commercial space company’ can survive today is with a NASA or military contract.”

Legendary aeronautical and spacecraft designer Burt Rutan takes a somewhat more hopeful position. He told me that he believes “…there will be no real limit to payload opportunities if someone would build orbital resort hotels and solved the cost and reliability problems with our booster designs that stem from the 1950s and 1960s.” He urged attention to the fact that “…in the 1960s, in seven years America developed five separate booster systems for launching people into space (Redstone, Atlas, Titan, Saturn I and Saturn V). All were flown safely with no accidents. Nearly 50 years later with the Shuttle (five decades after the original invention), it was more expensive and less safe to launch humans to space than the very first year… Clearly, we need design breakthroughs, not just another program to build the 1960s configurations. To enable that to happen we must have the courage to fly revolutionary ideas (propulsion and launch methods), not just build more of the old design concepts.”

In an June 2011 Seattle Times interview, Boeing Commercial Airplanes chief Jim Albaugh, questioned whether private space ventures can either fill NASA’s space transportation needs or be financially successful: "They are trying to commercialize space. ... Getting the reliability requires a lot of redundancy, which requires a lot of cost…I think it's going to be a money pit for a lot of them."

Of course it should be recognized that Boeing isn’t very enthusiastic about contract and funding shifts toward small firms. Stratolaunch CEO Gary Wentz, who recently left NASA to join Allen's venture, is more optimistic than Albaugh about private commercial space efforts. He said "I see this as an opportunity to sustain funding and move forward with a program and bring it to fruition."

But if the NASA market doesn’t work out, there might be another business opportunity after all. Last September, two months after the final Shuttle mission halted the U.S. ability to put American’s in orbit, a Tiangong-1 rocket lifted the first module of a planned Chinese space station to orbit from a launch site in the Jiuquan, Gansu province. The liftoff was part of a program aimed at putting a human on the moon by 2020. Still, I wouldn’t bet too heavily on President Hu Jintao or Premier Wen Jiabo asking for American mission support services any time soon.

Speaking on “Your World with Neil Cavuto”,  Apollo 17 commander Gene Cernan said: “The thing about the Chinese is they know where they are going and they know when they’re gonna get there. They have a plan, they have a mission.” After NASA cancelled its Constellation program, he, along with Apollo 11 commander Neil Armstrong and Apollo 13 commander Jim Lovell sent an open letter to President Obama. It said “For the United States, the leading space-faring nation for nearly a century, to be without carriage to low-Earth orbit for an indeterminate time into the future, destines our nation to become one of second- or even third-rate stature.”

So that’s where we are. As Congress and the Obama administration continue to kick NASA’s can down the road, our astronauts may just have to hitchhike in hopes of scoring lifts from  passing Russian or Chinese vehicles.