Select Committee on Science and Technology Written Evidence

Memorandum 65

Submission from Nigel McNair Scott


  I am a shareholder in Reaction Engines Limited, a business to which my family have subscribed £1 million as equity capital. Based at the Culham Innovation Centre, Reaction Engines is desiring a reusable space plane Skylon and has developed leading-edge technologies, in particular in cooling systems (heat exchangers), which will enable an effective engine for such a space plane. Skylon has the potential to radically change the business paradigm for space systems and provide the UK with a strategic advantage in space launch services.

  The wider space sector is a high added value, high technology, highly skilled industry with science-driven products and services of the kind that were identified by the Chancellor in his 2006 Budget Speech as the key to future wealth creation. Independent estimates predict annual growth of some 15% in the global space market over the next decade and the UK has the opportunity to increase its current market share in both systems and applications.

  Against this background I have been surprised by the difficulties that Reaction Engines has encountered in gaining Government support for Skylon, particularly the lack of strategic funding for technology risk reduction and development. Such support is important as it provides the credibility needed to raise equity capital. This situation is in sharp contrast to the support and funding available in other ESA Member States (for example Belgium and France) and must be a contributing factor to the substantial UK deficit in the system of commercial "juste retour" under which ESA procurement is conducted.

  The issues highlighted by the difficulties faced by Skylon are the UK Government policy towards space launch services and the effectiveness of its support for space technology R&D. I believe that these issues would benefit from consideration by the Committee as part of its inquiry into space. I am attaching some background information to support the Committee's discussion.

September 2007


  Over the last 15 years, Britain has concentrated on developing applications in space using other countries' delivery systems. This puts it at a strategic disadvantage in accessing delivery, both as to timing and availability. A reorientation of its policy to becoming a leader in delivery systems will be to our country's advantage, (a) commercially; (b) technologically; (c) strategically. That opportunity exists in the Skylon project, the expertise for which rests in our country.


  The development of Skylon will cut the cost of access to near space by a factor of at least 20. Skylon will operate like an aircraft, in the hands of competing operators, and give the customer more control of prices than is currently possible. It will give investors in the project and the countries in which it is developed the opportunity to earn a very great deal of money from a large and expanding market. One of the reasons I have invested is that I believe Britain will benefit from such a project.

  ESA has employed Reaction Engines to look at the feasibility of developing an intercontinental plane, using Reaction Engine's cooling and engine technologies (the "LAPCAT" Programme). Talks are also in progress about doing a feasibility study for ESA on the development of a space plane. This will be done jointly with two other major European aerospace companies.


  Skylon will allow the UK to maintain and expand its engineering base and build up its technological base. There are many other commercial applications for the cooling technology and other spin-offs from the Programme, for example in materials technology, reducing fuel consumption in aerospace, reduction of carbon emissions, more effective electricity plants and in large cooling systems.


  The British Government played a small but important part in funding the early development of the Reaction Engine's technology through the DTI SMART Programme (£187,000). This gave the company credibility to raise its third round of equity capital of over £1 million. It is important for the British Government to continue support at some level for the development of the heat exchanger as:

    (a)  its imprimatur and the fact that the project has been subject to technical review gives credibility to the next round of equity raising;

    (b)  there would be a negative message to the European Space Agency and European manufacturers if it was not there; and

    (c)  it gives a message to the UK scientific community that the UK government is prepared to support the emergence of a major new technology, and more particularly not be obstructive when the technology reaches maturity.


  There is a gap emerging in the international market for delivery systems. China and the US are concentrating on the development of rocket delivery systems for a return to the Moon and the first manned mission to Mars. This is a very expensive Programme with substantial problems vis-a"-vis mobilisation. It also shares technology tied in with military applications and is unlikely to be shared worldwide. Both countries would however pay for a low cost delivery system. Europe currently is dependent upon Ariane5 and Vega with no plans for anything more economical, and while Japan has been looking at space planes as an alternative, JAXA's plan does not envisage them being produced until 2020. At the moment the UK has a substantial lead in the enabling technology of the cooling systems which will enable the SABRE engine to be built and power a space plane. This gap gives a major opportunity to the European space industry to develop a low cost replacement for conventional rockets and sell vehicles or production licenses to other nations.

October 2006

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