Can private industry successfully build, own, and operate a space station? An independent business analysis presented to Congress on May 17 says it won’t be easy to make a profit and unlikely to be viable option by a proposed International Space Station (ISS) funding shutdown deadline at the end of 2024.
The Institute for Defense Analysis (IDA) Science and Technology Policy Institute presented its finding last week to the U.S. House of Representatives Subcommittee on Science, Space and Technology. IDA is a non-profit funded by the federal government to provide objective analysis on national security issues and conduct related research on other national challenges.
IDA looked at the possibility of a privately built, owned and operated commercial space station generating enough revenues to cover both capital and operating costs without government subsidies. The model IDA used was free market to the core, with a hypothetical private sector operator deciding station capabilities, markets it would serve, and prices it would charge to commercial and government entities.
Activities that could generate revenues for a private space station included a destination for commercial customers and government astronauts conducting general research; on-orbit assembly and support of satellites; manufacturing products and services for use on Earth and in space, especially high-grade silicon carbide and extremely pure fiber optic cable; R&D, testing, and Earth observation; and media, advertising, and educational activities.
From an IT perspective, a private space station could be used to produce ultra-high-quality fiber optic cable and silicon carbide for semiconductors. ZBLAN fiber could deliver an order of magnitude better than existing fiber, meaning less transmission losses.
Making ZBLAN fiber in normal Earth gravity is difficult, with crystals within the fiber quickly forming as it cools. Removing gravity removes the crystals, resulting in a production-quality product. The high-quality fiber could sell at a price of up to $2 million per kilogram, making it profitable even with the high overhead of space manufacturing.
If a private space station does get off the ground, ZBLAN fiber manufacture will be an anchor activity. IDA estimates in-space manufacture of optical fiber could generate revenues up to 35 percent for a commercial station, with in-orbit satellite assembly pulling in another 30 percent. Made in Space launched a demonstration fiber optic manufacturing package in December 2017 to make at least 100 meters of cable onboard ISS, with FOMS scheduled to put up its hardware later this year. FOMS says it should be able to make up to 50 kilometers of fiber per mission, according to literation on its website.
But IDA warns a private station might have competition from future Chinese and/or Russian space station efforts. The Chinese are on track to start building a modular station in 2020 and would no doubt be happy to have paying customers to offset nationally-funded operations. Russia’s plans are less clear, other than talking with the Chinese about joint operations past 2028, when the International Space Station is expected to be shut down.
There’s also the possibility of figuring out a better way to make ZBLAN fiber in normal Earth gravity, which would knock out a major economic pillar for a privately built and funded station. Such a risk may be the final straw in preventing venture firms from investing the billions it would take to build, launch, and operate a private station. Capital costs would have to be spread out over a decade or longer, increasing the risk of disruption.
IDA suggests exploring three different options instead of a 2024 shutdown of ISS. One would be extending ISS operations through 2028, with an estimated price tag of $3 to 4 billion per year at current prices and levels of operation. Privatizing ISS or pieces of it is another option, but one complicated by a web of international agreements with the European Space Agency, Japan, and Russia. Finally, NASA could choose to subsidize a private entity operating a commercial space station, but this could cost up to $2 billion per year.
Congress is not embracing an early shutdown of ISS, with Republican and Democratic Senators rallying around the space station. Both sides of the aisle would like to see the station continue to operate through 2028 at the very least.