Germany Backs Ariane 5 Price Supports as Hedge Against Weak Dollar

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  Space News Business

Germany Backs Ariane 5 Price Supports as Hedge Against Weak Dollar

By PETER B. de SELDING
Space News Staff Writer
posted: 10 October 2008
03:58 pm ET





GLASGOW, Scotland — Germany will continue to invest far more than half its annual space budget in the European Space Agency (ESA), setting itself apart from France and Italy, and is in favor of giving Europe’s launch industry a guarantee of price supports if the U.S. dollar falls below an agreed-to limit, the head of Germany’s space agency said.

Johann-Dietrich Woerner, staking out a clear German position in advance of a late-November conference of ESA ministers to decide future budgets and programs, nonetheless said the price supports for Europe’s Arianespace commercial-launch consortium must cut both ways.

“We are willing to provide them protection on the down side, but we will insist on being able to take advantage of the upside,” Woerner said in a Sept. 30 interview here at the International Astronautical Congress. “We think a rate of $1.40 per euro could be an acceptable level. If the dollar falls below that, we would provide compensation. If it is much above that, they would provide the governments with some form of compensation.”

As of Sept. 29, 1 euro was worth $1.46.

Europe’s launcher sector, led by the Arianespace consortium of Evry, France, is in final negotiations over a contract to build 35 Ariane 5 vehicles. Arianespace officials have said they hope the contract is signed by the end of the year, but the talks with Ariane 5 contractors have dragged on longer than expected, in part because industry is reluctant to commit to a price without knowing if a price-support mechanism will be approved by ESA governments at the November conference.

Woerner
said Germany would agree to a price-support scheme tied to the U.S.-euro exchange rate, but only for a certain number of launches per year, and on the condition that the government backers benefit if the dollar rises substantially. He did not specify whether the government benefit would be in the form of reduced-price Ariane launches for ESA satellites, or some other compensation.

Woerner
sought to portray Germany as a champion of ESA programs at a time when the agency’s two other big contributors, France and Italy, have decided to devote half their annual space budgets to national programs conducted outside of ESA.

Specifically he said Germany would support a billion-euro proposal to build three new satellites for Europe’s Kopernikus Earth observation system that would be duplicates for three satellites already approved.

Germany also will support a proposal to increase the size of ESA’sExoMars rover mission, Woerner said, but will oppose an increase in the ExoMars budget from 650 million euros to 1.2 billion euros, which ESA proposes.

“We think the Enhanced ExoMars program contains some good science and we support it,” Woerner said. “But we cannot endorse a doubling of the budget. We need to find some compromise level of around 800 million euros.”

David Southwood, ESA’s director of science and robotic exploration, said the Enhanced ExoMars mission might be trimmed somewhat but that “the 1 billion-euro level is the break point. Below 1 billion euros you’ve got a real problem with the mission,” Southwood said in a Sept. 30 interview.

Southwood
said he is aware that finding 1.2 billion euros, or even 1 billion euros, for ExoMars among ESA governments will be problematic, and he expressed optimism about securing the participation of the U.S. and Russian space agencies in the mission.

“If we can’t provide 1.2 billion [euros] from our member governments, we’ll have to find it elsewhere,” Southwood said, adding that ESA officials are confident that ExoMars prime contractor ThalesAlenia Space is doing all it can to keep down its costs, and the costs of its subcontractors.

Woerner
said Germany remains committed to an ESA proposal to make Europe’s Automated Transfer Vehicle (ATV) cargo carrier a two-way system by adding thermal protection to permit it to survive atmospheric re-entry.

The vehicle, which completed its first mission to the international space station Sept. 29 with a successful re-entry over the Pacific Ocean, currently is designed so that it is destroyed as it re-enters the atmosphere. “What a pity to see that go to waste,” Woerner said. “We are solidly in favor of ATV Evolution,” the program to adapt ATV so it can return payloads to Earth.