Art Stephenson’s February 8, 2000 Speech

FAA 3rd Annual Commercial Space Launch Forecast Conference

Pentagon City Best Western Hotel

Opening

Ladies and gentleman and honored guests, I am pleased to be here this afternoon and am honored to
represent NASA, the Marshall Space Flight Center and our many partners in discussing the
Administration’s Space Launch Initiative. I’m very pleased to be here today to elaborate on
NASA’s efforts in working with private industry and other Federal agencies to revolutionize space
transportation.

The issues associated with the current space launch industry have been summarized well in earlier
talks today – especially the comments of Dr. Neal Lane who discussed with you the recent launch
failures and near term recovery efforts, as well as the results of the launch range review. These
efforts are aimed at fixing immediate problems, improving cooperation and will assure continued
access to space for critical National Security, Civil and commercial missions. However, these
efforts will be unable to provide the dramatic breakthroughs necessary to realize NASA’s goals for
safe, reliable and affordable space transportation systems.

We have expensive systems that limit our civil space efforts in science and exploration. We have
an aging fleet that is based, in many cases, on decades-old technology. We have overseas
competition that has grown fierce as new foreign vehicles have entered the commercial market. The
Administration’s Space Launch Initiative will directly target these problems.

As you are aware, these problems are not new and were highlighted by the President in the National
Space Transportation Policy of 1994. In that policy, the Administration assigned NASA the lead
role for developing Reusable Launch Systems technologies and we initiated investments aimed at
dramatically improving the cost and reliability of getting to space. The Nation set forth a goal of

working toward a new Reusable Launch Vehicle, or RLV, that would be commercially developed
and operated in support of civil, commercial, and defense missions.
NASA, working with our industrial partners, initiated several efforts including the X-33, X-34, X-37
and Advanced Space Transportation programs. These investments were focused on developing
and proving key technological advances for RLV systems. We invested in specific concepts based
on the premise that major growth in the commercial launch market would enable significant private
financing of a new RLV, once the technology and business risks were reduced. We partnered
heavily with industry and pursued aggressive technology programs aimed at pushing the state-of-the
art. We aimed at breaking paradigms related to the management and operations of launch system
programs.

Through that process we have made substantial progress in understanding future space
transportation requirements and have gained great insight into promising, emerging technologies.
We better understand the balance between commercial and government interests. However, we
have also encountered difficult lessons and we are now experiencing delays in key technology
projects. Our collective efforts have advanced needed technological breakthroughs but have also
shown that significant risks remain. For example, we currently have four U.S. rocket engines in
American test stands that will demonstrate significant cost reductions and longer life than any other
engines we have ever built. However, additional work in developing higher design margins, longer
life, and improved operability is necessary to bring these new engines into routine operation.
Additional work is also required to take these advances to the next level and achieve NASA’s safety
and cost goals.

We have learned that emerging technologies will enable the needed advancements but also that
more development along multiple, competing paths is needed. We have learned that working
requirements diligently and working them in partnership with industry will allow us to better
converge with commercial capabilities. We have learned that commercial markets are not growing
as previously projected but there are still possibilities in the near-term to pursue alternate paths that
can make our access to space more robust.

The goal of transitioning NASA’s space transportation needs to commercial launch vehicles
remains the key goal of our efforts and will require additional investment to reduce business and
technical risks to acceptable levels. The Space Launch Initiative recognizes these facts and provides
the additional resources required to push forward, reach our safety and affordability goals, and bring
forth the promise of a new age.

We want to:

  • Significantly increase safety and reliability and reduce cost compared to existing systems,
  • Enable competing technical paths,
  • Maximize our convergence with the commercial launch capabilities,
  • Meet our near-term requirements while affordably providing growth paths to meet future needs,
    and

  • Ensure alternate means of access to Space Station.

    Improvements in the safety, reliability and affordability of current and future space transportation
    systems must be achieved if NASA is to perform its mission and if the U.S. space industry is to
    reach its full commercial potential. Thus, the Administration, NASA and the space launch industry
    will implement a three-point strategy to support these goals:

  • One, we will invest in technical and programmatic risk reduction activities, driven by industry need, to initiate full-scale development of commercially competitive, privately owned and
    operated, Earth-to-orbit RLVs by 2005;

  • Two, we will develop an integrated architecture with systems that build on commercial, Earth-to-
    orbit launch vehicles to meet NASA-unique requirements that cannot be economically served

    by commercial vehicles alone; and

  • Three, we will enable procurements of near-term, pathfinding launch services for select Space
    Station needs on commercial launch vehicles.

    The Space Launch Initiative is part of a larger NASA effort to strategically link decisions on Space
    Shuttle safety investments, Crew Return Vehicle, 3rd Generation space transportation technology.

    I’d like to take the next few minutes to talk about the specifics of the Space Launch Initiative and
    some of the elements of our overall, integrated strategy.

    Space Launch Initiative

    The Space Shuttle is the first generation reusable launch system and represents only a part of what
    is possible in space. NASA’s strategic plan and the promise of commercial opportunity in space
    requires dramatic and sustained breakthroughs in the safety, reliability and affordability of future
    systems. Future systems must be considerably safer and more reliable to operate than current
    expendable rockets and must focus on performance and simplicity through smart design and proven
    technology to bring costs down. Some US and foreign rockets used today fail between 1 and 10% of
    the time. NASA believes that we must work to reduce that to far less than 0.1%. While improving
    safety, NASA also believes that we must work to bring down cost, from the many thousands of
    dollars per pound it costs to launch payloads today. So, the Administration and NASA remain
    focused on reducing the risks associated with developing a 2nd generation RLV that meets these
    requirement and will invest in a competitive program to initiate full-scale development by the end
    of 2005.

    The Space Launch Initiative funds 2nd generation risk reduction activities at $ 4.5 billion over five
    years [$290 million in FY 2001, ramping up to $1.3 billion per year in FY 2004 and FY 2005].
    This more than a doubles the $2 billion five-year total that was included as a placeholder in the
    President’s FY 2000 Budget. These investments will enable a focused program for 2nd Generation
    RLV risk reduction and efforts to enable commercial launch services to the International Space
    Station. These programs will be referred to as the 2nd Generation RLV program and the Alternate
    Access program.

    As I previously stated, the 2nd Generation RLV program goal is to substantially reduce the technical,
    programmatic and business risks associated with developing a safe, reliable and affordable 2nd
    Generation RLV architecture. The program will invest in the technology development and
    demonstration, business and program planning, design and advanced development efforts to enable
    at least two competitive options for a new RLV architecture. Our specific goals are to improve the

    safety of a 2nd generation system by two orders of magnitude – equivalent to a crew risk of 1 in
    10,000 missions – and decrease the cost tenfold to approximately $1000 per pound of payload.

    To do this, NASA believes that a 2nd generation RLV architecture will consist of commercially
    developed and operated launch vehicles combined with government unique hardware. The
    integrated architecture will be designed to meet NASA’s future mission requirements and to greatly
    improve U.S. leadership in the space launch industry. The Agency will leverage the success and
    progress of our on-going space transportation programs to further reduce the remaining technical
    and programmatic risks but will specifically focus on creating a competitive environment.
    Competition is the fuel for innovation and the driver for efficiency, and it is critical to our strategy.
    We will pursue risk reduction efforts that will enable at least two competing architectures with a
    goal of maximizing the opportunity for commercially competitive and privately owned and operated
    systems.

    When we talk of competition and full-scale development this does not mean that NASA intends to
    “down-select” to a single winner. Rather, if the market can support more than one new RLV, we
    hope to develop an architecture that can benefit from multiple commercial providers integrating
    their systems with NASA and other government unique assets. We have designed a plan that will
    enable sustained competition through 2005 and a plan that will directly attack high priority
    technology risk areas. Our industry partners have told us that addressing safety and reliability will
    result in affordable systems. They have told us that we must focus on crew safety; propulsion;
    large, integrated airframes; and critical subsystem technologies before they can move forward. Our
    plan addresses these needs. We believe that numerous options should be considered and we will
    support industry’s best ideas – whether they are single stage or multi-stage launch systems.

    Through the Space Transportation Architecture Studies, NASA has worked closely with industry to
    better understand the basic requirements that must be addressed for a 2nd Generation RLV. This has
    set the stage but is insufficient to move forward with the major investments that I am talking about
    today. Therefore, NASA will spend the rest of this fiscal year working with industry and other
    Federal agencies, performing rigorous trade studies and focused systems engineering efforts to
    define higher fidelity requirements. We will investigate options for developing and demonstrating

    technologies that support alternate architectures and best validate these requirements. NASA is
    specifically asking our industry partners to challenge every requirement and to define innovative
    architecture options. We are striving to maximize the convergence between government and
    commercial requirements and continue our push toward commercialization and competing launch
    services. We will trade and refine our requirements to enable commercial launch service solutions
    to the fullest extent possible.

    Moving into FY 2001, NASA will begin new risk reduction efforts based on the established
    requirements. We have not made decisions on the complete nature of these activities but expect a
    continued mix of ground and flight demonstrations. We ask that our industry partners not tell us
    what they think we want to hear, but rather, tell us what risk reduction activities they need to
    undertake to best compete in 2005. Our investments will be driven by industry need and we will
    add more competition and an increased emphasis on requirements. The Space Launch Initiative
    also provides for directed risk reduction activities for NASA-unique systems. One area that we will
    be focusing on is the role of a Crew Return Vehicle in an overall architecture. We plan to continue
    CRV development but will make decisions in 2003 on whether we should build a vehicle that could
    fulfill more functions than just crew return. We will be marshalling significant resources for this
    undertaking but will need to remain focused on these kinds of critical decision points to achieve our
    goals.

    2nd Generation RLV will also be the application test bed for Intelligence Synthesis Environment
    (ISE) capabilities. ISE efforts will develop and implement a new age of engineering tools and
    capabilities and use these tools to better integrate and manage the program. Specific plans for ISE
    are in development and will continue to be developed throughout the year.

    The President’s policies asked for decisions on how to proceed with development of a 2nd
    generation RLV in 2000. With the Space Launch Initiative, we have made the decision to continue
    more aggressively toward our goals and have developed a robust strategy for getting us there.

    Alternate Access to Space Station

    In addition to the 2nd generation RLV technical risk reduction activities, the Space Launch Initiative
    also includes focused investment for near-term alternative access to the Space Station. The
    Administration and NASA are interested in enabling commercially provided launch alternatives for
    spares and other cargo and logistics materials to the Station. There are several important reasons to
    pursue alternative access to the Station:

  • To provide a U.S. capability for assured cargo access to the Station, in the event of future

    Shuttle launch stand-downs or potential shortfalls by international partners,

  • To enhance the operational flexibility of the Station, and
  • To develop essential capabilities that are needed for commercial access to the Station.

    The Alternate Access Program is a new start and will be funded with over $300 million dollars over
    the next five years. This program offers the opportunity to develop the unique technologies, system
    designs and innovative procurement mechanisms for the space launch and proximity operations
    elements of an alternate access system. NASA has begun initial efforts to define the requirements
    and options for alternate access and will solicit formal studies from industry in the next few months.

    We will work to assure proper integration of the Alternate Access program with 2nd Generation
    RLV activities. We will study the common elements and treat the alternate systems within the
    context of an integrated architecture. However, this program offers a unique opportunity for launch
    companies to find near term, commercial application for their systems. It also provides a potential
    opportunity to marry commercial interest in orbiting transfer vehicles with Space Station proximity
    operations requirements and may hold other similar opportunities that can offer mutual benefit to
    industry and NASA.

    The Alternate Access program is yet another example of how NASA is moving to commercial
    systems for our launch needs.

    Space Shuttle Safety Investments

    Our number one value at NASA is safety. Part of our commitment to safety is to ensure that the
    Space Shuttle is increasingly reliable for as long as it may fly. Until an effective alternative is
    demonstrated, NASA will continue to rely on the outstanding capabilities of the world’s first and
    only reusable space transportation vehicle. The Administration is committed to the continued, safe
    operation of the Space Shuttle. It is a high priority to assure the Shuttle’s ability to support
    assembly and operations of the International Space Station. The Space Shuttle system also provides
    flexible and capable transportation capabilities that we will rely on throughout the next decade.

    Investments in Shuttle safety improvements have been made over the last several years and we have
    cut the risk of flying the shuttle in half. At the same time, the Shuttle budget has been reduced by
    about a third through efficiencies and contract consolidation. Having achieved these reductions,
    continued improvements in Shuttle safety will require additional investment. Therefore, the
    Administration has augmented the NASA budget with investments that will continue to
    significantly improve safety and protect the nation’s investment in the Station and Shuttle.

    There are two elements to the increase in Shuttle safety funding. First, the President’s FY 2001
    budget request includes a $300 million increase through FY 2005 for additional personnel at
    NASA’s Human Space Flight centers to ensure that the right skills and staffing levels are in place to
    launch and assemble the Station. Second, a $1.9 billion “Safety Allocation” is made to address
    Shuttle safety improvements through hardware/software upgrades, personnel, facility, or other
    investments. This is a $1.4 billion increase over last year’s $500 million, five-year budget for
    upgrades.

    NASA will be conducting an external review to assess how these funds can most effectively be used
    to improve the safety of the Space Shuttle. NASA will proceed with the three highest priority
    upgrade activities, and additional activities may be started pending results of the external review.

    The three highest priority upgrades include two with firm plans: the electric auxiliary power unit
    (EAPU), and advanced health monitoring for the Space Shuttle main engines (SSME’s). These two
    upgrades alone will improve Shuttle safety during ascent from a 1 in 483 chance of catastrophic
    failure to 1 in 735. The third of the highest priority upgrades, which is still under study, is for
    improved avionics in the Shuttle cockpit. This will improve the situational awareness of the crew,
    and better equip them to handle potential flight anomalies. NASA is also investigating additional
    investments such as a new Combustion Chamber and channel-wall nozzle for the Shuttle Main
    Engines, an electrical replacement for a hydrazine-fueled pump system on the Solid Rocket Booster
    (SRB), redesigned solid propellant grain geometry to reduce manual inspections and repairs, and
    upgrades to the SRB attach/hold-down hardware. These and other options are expected to reduce
    flight risks to nearly 1 in 1000. As part of the agency’s overall strategy, we have set a goal of
    completing any new Shuttle safety upgrades by 2005 so a large number of Shuttle flights can
    benefit from those investments.

    Space Shuttle safety investments are an important element of NASA’s integrated space
    transportation strategy. Our program will provide the best assurance for continued safe Shuttle
    operations through this decade, and into the next decade, if needed.

    3rd Generation RLV’s – SpaceLiner 100

    Finally, I would like to discuss our efforts to assure long-term, improved space access beyond the
    2nd generation space launch initiative I discussed earlier.

    Our 2nd generation goals are the first step to our future but more aggressive improvements in safety
    and affordability are required if we are to truly achieve routine access to space. Systems that have
    the potential to bring down launch costs by a factor of 100 will have many of the attributes of
    today’s aircraft fleets. Safety and reliability are critical elements to any successful aircraft
    operation; such will also be the case for a 3rd generation space launch fleet. In developing far-term
    technologies for 3rd generation vehicles, NASA will concentrate on safety, reliability and margin.
    3rd generation systems, referred to by NASA as SpaceLiner 100, will emphasize safety first, which
    will, in turn, drive down cost. In order to achieve our ambitious safety goals, we must incorporate a

    safety-based design philosophy from the outset – safety cannot be added on after the fact. Our goal
    is to provide an additional two orders of magnitude improvement in safety with systems capable of
    $100 per pound of payload within 25 years. This safety goal is equal to one in one million chance of
    catastrophic failure.
    SpaceLiner 100 technologies and derived systems must be inherently reliable, functionally
    redundant wherever practical and designed to minimize or eliminate catastrophic failure modes.
    Design will have to minimize the opportunity for human or vehicle error through automated vehicle
    health monitoring and management. In the event of a vehicle failure, a separate, reliable means of
    personnel survival must be provided. Similar to the computer revolution, we will strive for
    operational simplicity while gaining dramatic improvements in capability.

    In a 3rd generation RLV, reliability could be improved through performance and reduced
    performance variability. This increase in performance margin will be available, for example, by
    increasing engine performance through combined rocket and air-breathing propulsion or through
    rocket engines that are 3 times lighter that today’s Space Shuttle Main Engine. Margin may also be
    made available through the use of other off-board energy sources that would provide a ground level
    launch assist. These technologies are the basis of our 3rd generation investments.

    To support these investments, the Administration has provided $1.2 billion over the next five years
    for the Advanced Space Transportation Program, a $200 million increase over last year’s plan. The
    budget provides funds for earth-to-orbit, in-space, interstellar, and other advanced transportation
    system research areas. These investments will build on our recent efforts and will take advantage of
    synergy with the Agency’s aeronautics research to build a balanced and aggressive Advanced Space
    Transportation program. We have already made dramatic breakthroughs in the testing of rocket
    based combined cycle engine concepts and are advancing multiple other research areas including
    magnetic levitation launch assist, advanced thermal protection systems, vehicle health management,
    and numerous in-space transportation system technologies. For example, we have successfully
    demonstrated through test, two RBCC flowpath designs from Mach zero to eight. We have also
    demonstrated for the first time ever, the transition from all-rocket to ramjet operation. We don’t
    believe that we will need to wait 25 years before we see the benefits of this effort. We will

    other important programs.

    Closing

    In closing, I’d like to emphasize once again that the Administration’s overarching policy on space is
    to take advantage of the synergies among the U.S. civil, commercial, and national security space
    sectors. We at NASA will continue in these efforts with a balanced program of investment. The
    Space Shuttle will be improved through focused safety investments as we aggressively push to 2nd
    and 3rd generation systems that will provide untold opportunity for the scientific exploration of
    space. We will work in close collaboration with private industry to maximize the opportunities for
    commercial launch services and will create an environment of increased competition. We will offer
    near term opportunity for alternate commercial launch vehicle delivery of cargo to the Space
    Station.

    The President’s Science Advisor said earlier today, “I believe that this Space Launch Initiative will
    ultimately prove to have as profound an impact on the future of space exploration and commerce as
    anything we have ever attempted as a nation.” I wholeheartedly agree with him and am very
    excited about this initiative. You should be as well.

    As the Center Director of the Marshall Space Flight Center, I have been charged with leading these
    programs, working closely with all of NASA’s Centers and I look forward to working with all of
    you to enable the future of America’s space launch industry which in turn will enable NASA’s
    future.

    Thank you!