Business Case Remains Barrier To Lowering Cost of Space Access

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SAN FRANCISCO — Commercial firms striving to develop low-cost, reliable space transportation are likely to succeed if they can obtain the financing needed to support their fledgling ventures. For many companies, that support remains elusive, however, because investors are not yet convinced that there is enough market demand to make commercial space ventures profitable.

“Right now, the biggest hurdle to low-cost, reliable access to space is the lack of investment capital that companies need to do the job,” Henry Vanderbilt, founder of the Space Access Society, said Aug. 24. “The private market can’t provide enough capital on its own. So government has to play a role.”

NASA is supporting efforts to push down the cost of space transportation through the Commercial Orbital Transportation Services, Commercial Resupply Services, Commercial Crew Development and Commercial Reusable Suborbital Research (CRuSR) programs. Although the CRuSR program pays suborbital firms to transport scientific research payloads to the edge of space, the project also is intended to lead to lower-cost suborbital spaceflight and, eventually, to less-expensive orbital transportation, NASA Deputy Administrator Lori Garver said July 28 at the NewSpace conference at the NASA Ames Research Center in Mountain View, Calif.

The U.S. Air Force also is striving to cut launch costs by building and testing experimental flight vehicles. “The fundamental role of government is to develop and flight test the kind of technology the commercial sector will use in the future to radically lower the cost of access to space,” said Jess Sponable, chief engineer of reusable boost system for the Air Force Research Laboratory at Wright-Patterson Air Force Base in Ohio.

With that role in mind, the Air Force Research Laboratory is supporting efforts by Denver-based Lockheed Martin Space Systems to develop and test a composite cryogenic fuel tank in 2012 and 2013. That tank, which measures 2.1 meters in diameter and 5.8 meters long, is being developed as part of the Air Force’s  Future-responsive Access to Space Technologies (FAST) program. The Air Force plans to fill the tank with cryogenic propellants and use heat lamps on the outside to demonstrate its performance during 100 mission cycles, Sponable said July 29 at the NewSpace conference.

Air Force officials also plan to begin flight testing in 2013 a spacecraft that uses a reusable first-stage booster and an expendable second stage for vertical takeoff and horizontal landing. The Reusable Booster System Pathfinder, which is designed to use the rocket engine to carry the first stage back to the launch site, is being developed by engineers at the Air Force Research Laboratory, Sponable said.

Reusable launch systems can dramatically reduce the cost of space access, Preston Carter, director of NASA’s Game Changing Technology Division, said. “When you get to 90 percent reusability by weight, that’s when the big benefits start,” Carter said July 29 at the NewSpace conference. “When 95 to 98 percent of the launch vehicle is reusable, that’s where costs fall by an order of magnitude.”

NASA officials said they hope to see the cost of space transportation drop to one-tenth of the current cost. While prices for various types of space transportation vary with different launch vehicles and orbital destinations, the lowest prices currently advertised are offered by Space Exploration Technologies (SpaceX) of Hawthorne, Calif. On its website, SpaceX advertises prices of $54 million to $59.5 million to send 10,450 kilograms into low Earth orbit — in essence $5,200 to $5,700 per kilogram — on its Falcon 9 rocket. The SpaceX Falcon Heavy, which is targeted for its initial flight in 2013, will drop the price to $2,220 per kilogram, SpaceX officials said.

That type of significant drop in launch costs may be enough to begin opening up new markets for space transportation, Vanderbilt said. He pointed to the 1993 Commercial Space Transportation Study produced by aerospace contractors and NASA’s Langley Research Center in Hampton, Va., that concluded that once launch costs drop to around $1,300 per kilogram, the market for space transportation would expand enough to offset the drop in revenue that results from trimming launch costs.

Until that point is reached, companies have little incentive to whittle away costs because their efforts are not likely to be rewarded with additional revenue, Vanderbilt said. Once it is reached, however, commercial competition and market demand will help to drive prices even lower, he said.

After adjusting for inflation and acknowledging that the 1993 study could only estimate how market demand would pick up with falling launch costs, Vanderbilt suggested that companies may begin to reap significant rewards once they can offer reliable space transportation for about $2,200 per kilogram. Reliability is a key ingredient. Companies should strive for 99.9 percent reliability, Sponable said.

If commercial space firms can offer that combination of low prices and reliable transportation, space tourism could grow significantly, industry officials said. In addition, some companies, including Virgin Galactic, are betting that consumers may be willing to pay for high-speed, suborbital point-to-point transportation, Charles Miller, NASA senior adviser for commercial space, said.

A recent NASA assessment identified the challenges inherent in developing low-cost, reliable access to space. “Everybody agrees that it is possible to achieve much lower cost, much more reliable space access if the market demand is high enough,” Miller said. “If you have demand for 30, 50 or 75 flights per year, you could close the business case with existing or nearly existing technologies.”

NASA officials identified one possible market that could produce demand for those frequent flights: propellant depots. “Our analysis suggests that propellant depots might close the business case and justify investments in reusable launch vehicles,” Miller said. To conduct a robust space exploration program with spacecraft traveling to asteroids, the Moon or Mars, NASA would need to use about 250 metric tons of propellant annually, Miller said. That means 50 flights per year carrying 4,500 kilograms of propellant. “When you add up all the other markets that a reusable launch vehicle could serve, you close the business case.”