Select Committee on Trade and Industry Appendices to the Minutes of Evidence


APPENDIX 12

Memorandum submitted by Space Future Consulting

ANALYSIS AND RECOMMENDATIONS ON THE DEVELOPMENT OF UK SPACE POLICY

INTRODUCTION

1.1  Relevance of Space Future Consulting to the committee's inquiry

  Space Future Consulting (SFC) is an international UK-based consultancy group that provides advice and analysis to the space, tourism, and media industries. As part of their operations, they maintain the informational web site www.spacefuture.com, the foremost source of information on space tourism, power, and vehicles on the Internet. SFC was the first in the world to carry out market research into the field of space tourism, and its work has been endorsed extensively by others, including NASA in its recently published report, "General Public Space Transport and Tourism" (1). SFC's head, Dr Patrick Collins, is the leading researcher in this field and has published papers on the subject for over 15 years. SFC's unique expertise is of direct relevance to revising UK space policy to achieve maximum economic benefit for UK taxpayers.

1.2  Summary of main points

  In recent years, UK space policy has excluded investment in launch vehicle development, and this policy has successfully prevented the use of taxpayers' money for unprofitable satellite launch vehicle projects. However, during 1998, both NASA and the American Institute for Aeronautics and Astronautics (AIAA) published reports concluding that general public space travel and tourism is going to become the largest commercial activity in space. This industry could commence in the near future with sub-orbital space flights using simple, low-cost vehicles. In order for Britain to profit from the future main commercial space activity, UK space policy should be revised to support British companies working towards passenger space travel, which have been excluded from HMG funding to date.

1.3  Structure of this document

  The principle findings of SFC are laid out in the main case and conclusion below. In addition, we have pleasure in enclosing three supporting Annexes:

    —  *Annex 1 is a detailed response to the policy and implementation issues raised the inquiry and listed in press notice No. 32.

    —  *Annex 2 is an analysis of space solar power as an emergent industry enabled by the development of the commercial space industry as outlined in the main case and Annex 1.

    —  *Annex 3 contains the contents of a memorandum sent to BNSC in May 1999 that discusses many of the issues pertinent to this inquiry.

 MAIN CASE

  Passenger space travel and accommodation should be accepted as important targets for space development work in the UK and for funding by HMG.

  2.1  In March 1998, NASA and the Space Transportation Association (STA) published the report "General Public Space Travel and Tourism" (1, 2), which concluded:

    (a)  Space Travel by the general public is a realistic objective; most people in reasonable health will be able to make a trip to orbit;

    (b)  Space Tourism, in the form of sub-orbital flights, requires no new technology and could start in the very near future;

    (c)  Tourism is likely to become the largest commercial use of space.

  Also in 1998, the AIAA (the world's largest professional aerospace organisation) published a report that summarised:

    "In light of its great potential, public space travel should be viewed as the next large new area of commercial space activity" (3).

  2.2  Space tourism is increasingly covered by the media, including the British press, leading magazines such as Time, Forbes, and Wired, and a large number of other magazines, newspapers, and television programmes. The concept is gaining increasing acceptance in public perception. Market research in Japan, America, Germany and Britain has revealed a strong public demand for space travel, even at relatively high prices.

  2.3  It is widely understood that the growth of space activities is constrained by the very high price of launch due to the use of expendable vehicles, and that reusable launch vehicles (RLVs) must be developed in order to sharply reduce the cost of access to space.

  2.4  It is not so widely understood that the main obstruction to the development of RLVs is neither technology nor cost but market factors—it is not economical to spend billions of pounds to develop a reusable vehicle for launching satellites, because the satellite launch market is too small to recover such a large investment. As an example, Lockheed-Martin's "Venture Star" proposal has an estimated development cost of some $6 billion, but the project has been shelved because this investment cannot be recovered. In contrast, the "Kankoh-maru" passenger-carrying orbital RLV (4) proposed by a Japanese business consortium has an estimated cost to market of $12 billion, but this would be recouped from the revenue generated from passenger space travel services.

  2.5  Based on technical designs, market research, and economic analyses, many of which are available online in the Space Future library (5), the prospects for passenger space travel services are extremely promising. If initial investment is made soon, orbital tourism could start in as little as 10 years, grow to an industry worth $20 billion per year by 2020, and increase to $100 billion by 2030, creating several million new jobs. By contrast, at present rates of expenditure, space agencies would spend $750 billion in the same period, which will neither be repaid nor create new jobs (6). Passenger travel is the only near-term market that offers a sufficiently large return to recover the substantial investment required.

  2.6  The potential of passenger space travel to grow to the scale of commercial aviation has important economic implications. There is approximately 20 per cent excess global capacity in car manufacture, steel production, and petrochemicals which is leading to severe competition and wide-spread losses. The cure is the development and growth of new industries. In order for passenger space travel to grow into a core twenty-first century industry, significant investment is required. Most of this will come from the private sector, but initial government seed-funding could accelerate the process, enabling Britain to play a major role in the heart of this new industry, rather than remaining an outside spectator.

  2.7  Although NASA has stated in print that space tourism is the most promising direction for commercialisation of space activities (1), it has not implemented its own recommendations. Instead it maintains that it has no responsibility to use its $14 billion per year budget to help make space accessible to US taxpayers. In fact, NASA is legally obligated by its charter to pursue commercialisation of space activities (7). Similarly, ESA has directed none of its several billion-euro budget to this field. This is not economically beneficial to taxpayers, and is solely due to the short-term interest of space agencies in preserving their government funding.

  2.8  Recent developments in the US and elsewhere indicate that there is a new wave of entrepreneurial activity in the space industry. This includes the creation of Bigelow Aerospace, Virgin Galactic Airways, and the recent formation of MirCorp as a joint US/Russian venture to rescue and refurbish the Mir space station as a tourist destination, with the first tourists planned in early 2001. There are several serious commercial RLV companies in the US, and these developments should substantially improve the credibility of space tourism as a business and assist them in raising the finances they seek.

  2.9  Britain has a wealth of expertise in all fields relevant to the development of passenger space travel, which are almost identical to those involved in aviation. It should be particularly noted that aerospace engineering and related service industries are particular strengths of the British economy, and Britain plays a disproportionately large role in these activities in the global economy. This is described in detail in a memorandum sent to BNSC in May 1999 (Annex 3).

  2.10  A small percentage of HMG space funding could have a major impact. However, work in the UK is being prevented by current space policy, which does not distinguish between unprofitable satellite launch vehicles and potentially profitable passenger-carrying vehicles. The design requirements for passenger transport vehicles are quite different than those of satellite launch vehicles. However, government space agencies are very reluctant to accept this conclusion.

  2.11  An example of a sub-orbital RLV that would make a good entry point to commercial space tourism is the "Ascender" sub-orbital passenger vehicle in development at Bristol Spaceplanes Ltd (8). This draws upon earlier British experience of rocket-powered aircraft, including the Saunders-Roe SR53, which flew in 1957 (and whose chief engineer is on the Ascender team). The Ascender project has been widely praised as realistic, particularly in the aviation world (9). However, the project has not received any government support due to current UK Space Policy.

  2.12  Amongst the leading countries, Britain is the least inhibited by vested interests in existing government-funded launch systems, since HMG correctly declined to participate in these projects and instead concentrated efforts on potentially commercial space activities. However, recent recognition that passenger space travel will become the major commercial activity in space requires a revision of UK space policy. If this occurs soon, Britain has the opportunity to spearhead this promising new field.

SUMMARY AND CONCLUSIONS

  3.1  Space activities are still a heavily subsidised government-funded activity. Only when the development of an independent commercial space industry is made a core objective of government space funding will space activities become self-supporting.

  3.2  The development of a passenger space travel industry requires collaboration between space and aviation bodies, including companies, research institutions, and regulatory authorities. This process should start with the development and operation of sub-orbital passenger space travel services.

  3.3  Britain is the country best positioned to take an initiative in this new direction and the least interested of the leading industrialised nations in preserving the current status quo of the government-supported space industry. It is also home to several pioneering companies in the field of passenger space travel. HMG should take steps to exploit the opportunity that these companies' skills represent.

  3.4  It is strongly recommended that UK space policy be revised to enable government funding to help British companies, organisations, and researchers develop sustainable competitive advantage in this most promising field of commercial space activity.

References

  1.  D O'Neil et al, 1998, "General Public Space Travel and Tourism—Volume 1 Executive Summary", NASA/STA, NP-1998-03-11-MSFC, also downloadable from http://www.spacefuture.com/archive/general public space travel and tourism.shtml.

  2.  D O'Neill et al, 1998, "General Public Space Travel and Tourism Volume 2, Workshop Proceedings", NASA/STA, also downloadable from http://www.spacefuture.com/archive/general public space travel and tourism volume 2.shtml.

  3.  Ivan Bekey, 1998, "Report of Working Group No 4 of the AIAA/CEAS/CASI Workshop on International Co-operation in Space", also downloadable from http://www.spacefuture.com/archive/report of working group 4 of the aiaa ceas casi workshop on international cooperation in space.shtml.

  4.  K Isozaki et al, 1994, "Considerations on Vehicle Design Criteria for Space Tourism", Proc 45 IAF Congress, paper no IAF-94-V.3.535.

  5.  http://www.spacefuture.com/cgi/glossary.cgi?gl=doc&key=lib.

  6.  P Collins, 1999, "Space Activities, Space Tourism and Economic Growth", Proceedings of second ISST, Space Tours GmbH, also downloadable from http://www.spacefuture.com/archive/space activities space tourism and economic growth.shtml.

  7.  "National Aeronautics and Space Act of 1958 (As Amended) ", also downloadable from http//www.hq.nasa.gov/office/pao/History/amendact.html.

  8.  http://www.bristolspaceplanes.com/projects/ascender.shtml.

  9.   Aviation Week & Space Technology, 13 December 1999, p 79.


 
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