Space acquisition chief: DoD will buy small satellites, at fixed prices

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'There's a lot of pressure on the Department to go faster in space acquisition'

WASHINGTON — Soon after his Senate confirmation hearing in February, Frank Calvelli, assistant secretary of the Air Force for space acquisitions and integration, started to put together a list of problems he saw in DoD’s space procurements and possible ways to fix them.

It turned out to be a really long list that eventually Calvelli boiled down to a three-page memo he released Oct. 31. “After I started actually working on this, I realized I was writing a novel and no one was ever going to read this,” he said Dec. 15 at a Washington Space Business Roundtable event near Capitol Hill. 

At the top of Calvelli’s list of nine “space acquisition tenets” is to build smaller satellites using commercial components and production methods. He expects the U.S. Space Force to start transitioning to smaller satellites and end procurements of billion-dollar satellites that on average take seven years to develop.

“There’s a lot of pressure on the Department to go faster in space acquisition,” Calvelli said, amid concerns that China is building new constellations at a rapid pace to compete with the United States.

Military space systems today are primarily large satellites in geostationary orbits, and there is no easy or fast way to replace these assets if they were struck by anti-satellite weapons. “We have a need for resiliency in our architecture through things like orbit diversification and proliferation of satellites,” said Calvelli.

“As the threat to space systems continues to evolve, and as space becomes even more important to give advantages to our troops, timely delivery of capabilities becomes even more critical for the nation,” he said. “So given the threat, and the need to drive speed into our space acquisition, I fundamentally believe that traditional ways of doing space acquisition must be reformed.”

Calvelli wants acquisition officers to avoid cost-plus contracts when at all possible and instead buy satellites at fixed prices, a model embraced by the Space Development Agency, a Space Force agency that is procuring a mesh network of small satellites in low Earth orbit.

“Speed in space acquisition is a very simple formula,” Calvelli said. “You build small, you use existing technology and reduce non recurring engineering. You take advantage of commercial capabilities and you execute.”

Cost-plus contracts — where the government pays for development costs and absorbs any cost overruns — incentivize vendors to add years to a program and make systems more complex than they need to be, he said. Fixed-price contracts, on the other hand, incentivize “speed and performance.”

“Don’t. be afraid to use fixed price contracts,” he insisted. “NASA is now doing more fixed price contracting. The National Reconnaissance Office has talked about doing more fixed price contracts. Now the Space Force needs to be doing more fixed-price contracting.”

Calvelli’s watch list for 2023

As Calvelli continues to push for changes in the Space Force procurement culture and contracting practices, there are some specific programs he will be watching closely next year. 

One is United Launch Alliance’s Vulcan Centaur rocket, a new launch vehicle the Space Force selected for national security missions and is years behind schedule due to engine development delays. “I want to see Vulcan fly in 2023. I look forward to that,” Calvelli said.

Other programs that Calvelli will be monitoring are the next-generation OCX ground control system for the Global Positioning System constellation, and a space-tracking system called ATLAS, short for Advanced Tracking and Launch Analysis System.

The long-delayed ATLAS was designed to replace an old legacy system, called SPADOC, used for tracking space objects.

“I want to see the retirement of SPADOC,” said Calvelli. “We need to do that.”

With regard to OCX, “I want to see OCX deliver,” he said.

Also on his radar are the next-generation geosynchronous and polar infrared satellites that provide early warning of ballistic missile launches. Five satellites — projected to cost nearly $14 billion — are in various stages of development. “We need the next-gen GEO and polar on cost and on schedule.”

Finally, Calvelli wants to see the Space Development Agency launch its first batch of satellites to low Earth orbit. The agency’s Tranche 0 satellites were scheduled to launch in 2022 but slipped to next year, with the first launch targeted for March and the second in June. “I look forward to that,” he said. “ I want to see SDA launch Tranche 0. That has to happen.”