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« More Idiotarians On Parade | Main | Penultimatum? »

One Giant Leap Backwards

The day that Columbia was lost, I noted, among other things, that the Orbital Space Plane would be a step backwards for the nation as a Shuttle replacement. Some in the comments section asked why I believed this.

Here's an all-too-credulous article from Saturday's Baltimore Sun about the OSP and NASA's plans. It's unfortunate that reporters are usually unacquainted with economics, or even basic accounting--they often simply accept whatever government agencies say at face value.

In the wake of the Columbia disaster, NASA officials say they're accelerating plans to develop a $12 billion Orbital Space Plane that would ferry astronauts to the International Space Station by 2012 at a lower cost than the space shuttle can.

OK, we have an assertion in the very first paragraph that something that costs twelve billion dollars to develop (and presumably purchase a small fleet of) will be lower cost than something that we already have. Let's see if the claim stands up to financial reality, and if it's worth the money.

Designed to function more like a minibus than the truck-like shuttle does, the lightweight space plane would carry mostly human cargo and rely on rockets and other technology that NASA has developed.

The space plane might not look like a traditional plane at all, but more like an earlier generation of capsulelike craft that were launched by expendable booster rockets in the Gemini, Mercury and Apollo programs.

Ahhhhh...back to the future!

Smith said the space plane would be no more than half the size of a shuttle, which has roughly the same dimensions as a DC-9 jetliner.

What does that mean? The Shuttle is a launch vehicle, one that grosses millions of pounds as it launches. Perhaps he means that it will be half the size of an orbiter. But what does that mean? Wingspan? Weight? Length? How large will the payload bay be?

What!? You mean it doesn't have one?!!

The latter is an important question, as I'll get to in a minute.

It also would cost far less to operate than the shuttle's $500 million per flight. NASA hopes the space plane would shave the cost of ferrying passengers to the station to $100 million per flight or less.

Smith said he expects a flying version of the space plane by 2010 and regular service two years later.

Here is the nub of the issue. The implication would be that we will save four hundred million dollars per flight by using the OSP rather than the Shuttle. Let us examine it.

First, let's figure out where the hundred million figure comes from. If the OSP is to be launched on something like, say, a Delta IV, then we have to figure on the cost of the launch system. Though the Boeing description doesn't have prices, digging around a little, I found this page, which says that Boeing will be paid $1.38B for twenty two launches, which comes out to about sixty million a flight. So that leaves forty million for everything else (and of course, it assumes that no further investment will be needed in the new Delta to "man rate" it).

Let's indulge in a little political fantasy for a moment, and assume that the Congressfolks from Florida and Texas and Alabama, actually allow a significant cutback in the annual budget for fixed costs at the Cape, and Houston and Huntsville, that's currently allocated to Shuttle (over three billion) to, say, a third of that--a billion dollars. Since crew rotate every three months at station, there's no need for more than four flights a year, so we get a quarter of a billion per flight for amortization of fixed costs alone. In order to get it down to forty million, they'd have to reduce the annual Shuttle budget to five percent of what it is currently--a hundred and sixty million dollars per year.

I suspect the reality is that their hundred megabuck estimate doesn't actually include the fixed costs--they're quoting marginal cost for the OSP, and then comparing it to average cost for the Shuttle. If so, I call foul. You've got to compare like fruit to like fruit--the marginal cost for the Shuttle (the cost of flying the next one, given that you're already flying that year) is more like a hundred fifty million.

But OK, let's continue to be generous, and assume that they really are referring to average annual cost per flight. Now we're down to a hundred million per flight, as they claim.

Or are we? Aren't we forgetting something? When the Shuttle launches, it doesn't just deliver people to and from space. It also delivers (and sometimes retrieves) tens of thousands of pounds of payload. NASA is proposing to "unbundle" the cargo delivery and return service from the passenger service. Fine, but now they have to account for getting the cargo up some other way. That means that you can't replace a Shuttle launch with an OSP launch. You have to replace it with an OSP launch plus a cargo launch. Whoops, you just added another sixty million dollars per flight (again, generously assuming that the number above for Delta IV flights is correct).

And what if we were going to retrieve something? We just lost that capability entirely. Not necessarily a bad thing, but we have to understand the program implications of it--remember, the ISS was built partially as a way to justify the Shuttle program, and its design and operations are centered on the assumption of servicing, construction and operation via the Shuttle.

But let's forget about that one as well. Here's the real kicker.

NASA wants to spend twelve billion dollars up front to build a fleet of OSPs.

Where are they accounting for that cost in their estimates? If you're going to justify the OSP based on savings over the Shuttle, then you have to include that up-front cost in the calculation. After all, though Shuttle is expensive, it doesn't require any major capital outlay up front--it will simply continue to absorb its annual budget as long as we continue to operate it.

So what is the internal rate of return on this investment? I'm working on a spreadsheet for a more sophisticated analysis, but if we assume that it flies four flights per year for ten years, and no discounting (i.e., a dollar in the year 2020 has as much value as a dollar next year, another generous assumption) that twelve billion has to be amortized over forty flights. That means add another three hundred million dollars per flight. Considering the time value of money makes the situation much worse, since the development costs are in fact paid for in much more expensive dollars than the out-year operations costs.

But now, even with all of these generous assumptions, we're up from the claimed hundred million per flight to almost half a billion ($160M + $300M). Whoops, that's getting close to what the Shuttle costs, with much less capability. The reality (particularly annual fixed costs, and the cost of man-rating the Delta, and the actual launch price of the Delta) is probably much worse.

At best, NASA sees the Orbital Space Plane as an interim solution for supplying crews to the space station while it develops a more advanced ship that would be launched more like an ordinary plane and would be able to draw oxygen from the atmosphere instead of using heavy tanks of liquid oxygen.

Thus, they propose to spend twelve billion dollars over the rest of the decade, for an "interim solution" that won't fly until the next decade, at which point, they presumably plan to spend many billions more on a true "shuttle replacement"--an airbreather.

Smith said yesterday that the Columbia disaster "validated" plans NASA announced in November to produce the passenger craft.

I can't imagine any sequence of events that wouldn't "validate" NASA's plans in the mind of Dennis Smith.

There is a little hope, though.

Critics called the program shortsighted.

And they didn't even ask me.

"It lacks vision. It's a stopgap measure for NASA so it can fulfil short- term goals of supplying a space station, which has a limited life of its own," said Rick N. Tumlinson, president of the Nyack, N.Y.-based Space Frontier Foundation.

Tumlinson said the space plane would supplement a shuttle program that he called basically an "expensive government trucking service" that could be handled by the private sector.

NASA should focus instead on exploring the planets, he said.

"The space plane is part of an extension of a shuttle program that's been heading in the wrong direction," he said. "The goal should be to make space travel more routine, less costly and safer."

Of course, this then causes a rise to NASA's defense by its primary beneficiaries.

Bruce Mahone, director of space policy for the Washington-based Aerospace Industries Association, an industry lobbying group, defended NASA's plans.

He said that although the shuttle fleet is aging, the three remaining craft are constantly being upgraded and have years of service left.

None of them has flown the 100 missions envisioned for each when the shuttle program began in the 1970s, he said.

The space plane "will be much smaller than the shuttles, newer and more inexpensive if designed properly," he said. "It's a lifeboat for the space station."

This is utterly incoherent. Smaller may be good, or it may be bad. Hard to know, because we don't know what the requirements are. It will certainly be newer, but that's not an intrinsic virtue, either. I've already demonstrated that it won't be more inexpensive, and of course, we have that nasty little word "if."

Based on history, how much faith should we put in that?

Utter insanity.

NASA has to be taken out of the space transportation business, ASAP. Step one of that, of course, is deciding what we want to accomplish in space. This entire episode simply point out the absurdity of our current manned space program. Until we want to have serious accomplishments in space, we need no new vehicles. We don't even need the ones we have.

Posted by Rand Simberg at February 17, 2003 12:21 PM
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NASA's entire argument for the OSP comes from the following premise, "Hi we're from the government and we're here to help."

Posted by Steve at February 17, 2003 01:26 PM

It's complete lunacy... but how to change it? As long as the polical/industrial pork symbiosis exists what can be done?

This is partly why I promote the idea of Mars colonization. First, because it's an idea that people can understand (regardless of agreeing with it or not.) Try as they will, even NASA can't do this as inefficiently as they'd like to because it's too easy to show how stupid it would be (building the equivalent of a railroad train at the space station just isn't going to happen... but a 'Mars Direct' heavy lift vehicle certainly could.)

I agree that this doesn't address improving cost by increasing flight rates. But I think we need a direction first, then effeciencies will follow. This isn't the 1970's. People got bored with the moon because all we seemed to have to show for it were rocks not much different from what we could find in our own back yard. The same argument could be made for Mars except for one thing...

People could become self sufficient in a very short time. Instead of putting 12 on the Moon 2 at a time, we put all twelve at once on Mars and things will start to happen. I'm thinking not just geologists but film crews. Hey, and you've got to have at least one landscaper with a bulldozer to build habitats, right?

First we send cargo to a site to be developed. This time, our little camera crawler should include rechargable batteries! After we've got enough stuff waiting we send people to make use of it.

Get enough people permanently on Mars and they will begin to influence how things are done back here on Earth. People here will lobby for them and stupid ideas will be weeded out (ok, it's impossible to weed out all stupid ideas!)

I can imagine someone setting up a business as a backup mirror site for safely storing data... "You might not survive Armageddon, but your data will!"

We can do it.

Posted by ken anthony at February 17, 2003 01:38 PM

Getting to Mars should be a means, not an end.

People need to stop thinking of a Mars expedition as Apollo writ large-- unless you can tell me what happens after the third landing, and justify it, then you are wasting everyone's time with wishful thinking on another dead end. Sorry.

What's needed is for the ISS management authority to put out a RFP ("Requst for proposal" I think it means). In it they would detail what the want/need in the way of space transportation system(s). Then it would be the resposibility of various companies to come up with solutions, and what they would cost. Then the ISS managers would issue contracts for the systems that meet their needs. That would be a good start to get away from this gov't one-size-fits-all planning.

Better yet, as an international body, the bidding should be open to non-US companies. Hey, maybe the Soyuz really is the solution. Or maybe the Chinese will have an incentive to do more than "plant the flag." But we'll never know if we don't try it.

Posted by Raoul Ortega at February 17, 2003 03:30 PM

In general, I agree with you Raoul, but Apollo was never intended as a colonization. Where Mars should be from the beginning. Which answers your question about what happens after the third landing... farming, habitat building, learning to live off the land. In a word, colonizing.

Colonizing a planet is it's own justification.

Think North-America, that turned out pretty good.

Posted by ken anthony at February 17, 2003 06:54 PM

At the risk of raining on everyone?s parade all of the articles I?ve indicate that the OSP will be a supplement to the shuttle which means NASA will still be flying shuttles and given that Columbia couldn?t reach the ISS with any useful payloads I would imagine that the shuttle schedules to the ISS won?t change that much with just the remaining shuttles and so they?ll soak up some of the fixed coast Rand spoke of. Also since the low number of flights per year has been a major sore point for critics of NASA and the fact the within government circles it is a sin to not spend every penny of your budget +. I would think they?d want to find every excuse they could to fly the OSP (just because a crew can spend up to 3 months at the ISS doesn?t mean they have to). Don?t get me wrong the OSP is a stop gap measure that will do little or nothing to get large numbers of people into space but I don?t think the numbers are quite as bad as they appear here.

Posted by Shawn at February 17, 2003 06:55 PM

Shawn, with due respect, that's even more insane. NASA's justification for OSP seems to be that it will save money over Shuttle. If they continue to operate Shuttle, then there will be no savings at all--it's simply another twenty billion more in expenditures over the next two decades, with no significant cost reduction for delivering people to orbit, or expansion of crew capability to orbit, and no savings at all.

The current US manned space program is an ongoing economic and useless catastrophe, from any standpoint, but foremost opportunity cost.

Posted by Rand Simberg at February 17, 2003 07:15 PM

'opportunity cost' - the most frustrating phrase in the english language. Particularly since it's the flip side of that lack of vision thing!

If you don't see it (or are unwilling) ya just don't see it. I think you both hit on the truth... NASA wants to keep the shuttles flying AND add more billions for a new program. We focus on ISS and the shuttle, but that's what NASA is, a bunch of programs with as many more as they can fit in... the more expensive the better. Why else would they provide such a ridiculous response to Bush Senior's call for a Mars plan?

Posted by ken anthony at February 17, 2003 07:36 PM

Given the history of NASP, X-33, X-34, X-38 how on earth is it possible that they are still allowed to continue ? How many Beal Aerospaces will it take ?

Posted by at February 17, 2003 10:28 PM

has anyone missed on this item?
According to the article the OSP will be ready for flight by 2012, but that's very near the end of the ISS life cycle! they will be able to fly it for a very shrt amount of time (assuming NASA doesn't use the OSP to justify another space station - something I wouln't take out of the question).

Posted by bater at February 18, 2003 07:13 AM

Life cycles on things like ISS are an accounting fiction. There's nothing that would wear out on it that can't be replaced or upgraded. We'll continue to use ISS as long as it seems useful (for either scientific or political reasons) to do so.

Posted by Rand Simberg at February 18, 2003 08:36 AM

So Rand if I understand you correctly, you are suggesting that NASA should just contract out to Pioneer or x-cor or whomever to take passengers up and retire the shuttle and osp. Which I think is a wise long term goal. But Pioneer and x-Cor aren't capable of filling in just yet, should NASA push seed money, or sit back and use the shuttle until one of the spaceplanes are mature enough to contract? Or do I have you all wrong here.

Posted by ruprecht at February 19, 2003 02:47 PM

The issue isn't whether private providers are available today, but whether they could be available by 2012 (assuming that NASA correctly estimated the timeframe for the OSP, not something NASA has done well over the last 30 years). There's every reason to believe it could be. Manned spaceflight is currently plagued by regulatory uncertainty, and NASA does its part to discourage competition. Bring down the barriers and dangle the possibility of launch contracts and those technologies would be developed in no time. Unlike the X Prize, there would be no prohibition against using equipment developed under government contract, so Boeing and Lockheed would certainly jump into the fray. There would be others, the degree of their investment would depend in part on how the regulatory environment shaped up and how much they expected from the secondary markets like space tourism and "anywhere on the planet in two hours" shipping and passenger travel.

Posted by Jeff Wolfe at February 19, 2003 10:38 PM

OSP - Waste of money cost per kg to orbit is the bigest problem and I would hate to see the OSP expressed as this 4 people , $M350and you are looking at $1M/Kg? . The only justificantion I can see is if they plan on adding a cheap unsafe mass produced Heavy lift rocket that can put 100 tons in orbit ( will prob have to be air breathing to reduce O2 required) . That way the space plane takes care of people and opporates out of the space station moving things around as well handling crew.

On the other hand if they gave $11B ( instead of $1.5) to X33 it would probably be ready now and we could be seeing new craft come up by 2008 instead of 20-30 year old shuttles. Lets hope if they do they build 10-20 instead of 4....That will push the real cost per flight down and open up many opportunities. eg if you want to go to mars just take the fuel store it at the ISS and when you have enough - put it in your vehicle and launch , 100 * more efficient than from earth also the moon would be even easier.


Posted by Ben Kloosterman at February 21, 2003 09:12 PM

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