Friday, February 16, 2018

Ottawa Announces Winners of $950Mln 'Supercluster' Competition

         By Henry Stewart

Ottawa has announced the five "industry led" technology groups slated to get a piece of the $950Mln Federal government “superclusters” funding.

Minister Bains at the CSTM on Thursday, February 15th, 2018. The supercluster funds will be distributed over five years to the winners, which will be required to match the federal funding they receive with equivalent private sector funding. Photo c/o CBC News.

As outlined in the February 15th, 2018 Global News post, "Government reveals who is getting $950M in ‘supercluster’ funding," Federal Innovation Minister Navdeep Bains made the announcement Thursday at a press conference held in the Ottawa, ON based Canada Science and Technology Museum (CSTM).

The announcement "closed out a nine-month contest central to the Liberals' so-called innovation agenda. The project was designed to encourage academia and businesses to work together on strategies to boost fast-growing sectors" and is a central platform in the Liberal's Innovation Agenda, according to the February 15th, 2018 CBC News post, "AIs, Oceans and proteins: Ottawa announces winners of $950 million 'supercluster' competition." 

The five technology groups chosen for funding include:
  • Canada's Ocean Supercluster, based in Atlantic Canada, which will develop and utilize innovative technologies to improve competitiveness in Canada’s ocean-based industries, including fisheries, oil and gas and clean energy. Partners include PQ based ABB Canada, Ottawa ON based C-CORE and Cambridge, ON based exactEarth.
  • The Quebec based SCALE.AI Supply Chain Supercluster, which will work on building intelligent supply chains using artificial intelligence and robotics. According to its website, the consortium includes "over 80 Canadian companies, 26 business associations and 12 Canadian academic institutions." 
Another proposal, from the Satellite Canada Innovation Network, which was discussed in the August 3rd, 2017 post, "Satellite Canada Applies for Innovation SuperCluster Funds," didn't make the list of finalists.

Last fall, the government narrowed a field of about 50 applicants to nine organizations. The money will be distributed over five years to the five winners, which will have to match the federal funding they receive, dollar for dollar.

The government expects the program to eventually create more than 50,000 jobs for Canadians.

Henry Stewart is the pseudonym of a Toronto based aerospace writer.

If CSA REALLY Under Spent its Budget by $800Mln over 17 Years, it Likely Gave the Money Back to the Treasury

         By Chuck Black

Federal budgets are sometimes complex creatures which might not be immediately understandable to rocket scientists and the writers at consumer media outlets.

But the suggestion made by Canadian based SpaceQ that the Canadian Space Agency (CSA) has "under spent" its annual budget by over $800Mln CDN over the past seventeen years is simply not supported by any real evidence.

The upcoming RADARSAT Constellation Mission (RCM) is a useful example of how it's difficult to assess funding without context. As outlined in the October 6th, 2012 post, "The Last Days of the Current CSA President," the RCM program has been kicking around CSA headquarters since 2004, although initial phase "A" funding for the project only began in 2006. By 2012, as outlined in the May 1st, 2012 post, "Media Reports: CSA "Lost in Space," RADARSAT "Over Budget" & UrtheCast "Hyped Vaporware," RCM was over budget and behind schedule.  In 2013. the Federal Conservative government under then Prime Minister Stephen Harper responded to the problem, as outlined in the January 12th, 2013 post, "A $706Mln Fixed Price Contract and Hard Launch Date for RADARSAT Constellation," by negotiating an unusual hard launch date and fixed price contract with RCM prime contractor, the then Richmond BC based Macdonald Dettwiler (MDA). Of course, a fixed price contract didn't mean that there weren't extra costs, as outlined in the July 4th, 2016 post, "That 2013 "Fixed Pricing" Contract for RCM Might Not be Entirely Fixed." It's also worth noting that funding and accountability problems within the CSA were at the core of the 2012 David Emerson led Aerospace Review which, as outlined in the December 5th, 2012 post, "What the Space Volume of the Aerospace Review Actually Says" recommended removing most procurement functions from the CSA and adding new committees such as the Space Advisory Board (SAB) to oversee CSA activities. Graphic c/o CSA.

And those unspent CSA funds are not lying around in a CSA office somewhere just waiting to be reallocated. Any extra funds likely reverted to the Treasury Board of Canada, the Federal government department responsible for accountability and ethics, financial, personnel and administrative management of the Federal bureaucracy.

But it's very easy to come to the opposite conclusion after reading the February 14th, 2018 SpaceQ post, "The Canadian Space Agency has Underspent its Budget for the Last 17 Years." According to the post:
In the last 17 years the Canadian Space Agency (CSA) has left $802Mln in planned spending unspent. In the last three years the CSA has under spent its budget by $201Mln.  
In 2010 the Conservative government began the process of decreasing the CSA’s base budget from $300 million to $260 million. The Liberal government has not restored the CSA’s annual base budget funding cut. Add these points together and it’s no wonder the space community is concerned. 
Those are strong claims, especially given that there is no immediate mention of the project funding normally allocated on top of the base "A" funding, which is used to cover operational expenses, salaries and other overhead.

Lowing the base A funding level is normally considered good for a government department and for taxpayers as well. It means less bureaucracy, over-site and paperwork to deal with for the same amount of project funding.

To find out what the CSA budget actually is, check out the March 9th, 2017 Federal government document, "CSA Departmental plan for 2017 - 2018," which covers the CSA mandate, its plans for the year, the estimated budgets and HR requirements, the expected results and a variety of other supplementary data. The next CSA departmental plan is expected to be released in March 2018 and should be available on the CSA "Reports to Parliament" website. Graphic c/o CSA.

Project funding is what defines the success or failure of a government department, since it's the money which goes to implement projects and programs and has the most effect on public perceptions of effectiveness. Project funding is normally a substantial portion of the overall department funding.

For example, as first outlined in the March 7th, 2010 post, "Feedback on the Throne Speech and Budget," any reasonable assessment of CSA funding in 2010 would also include the $110Mln CDN allocated by the Federal government over three years beginning in 2009 for next generation Canadarms and rovers, plus the substantial additional funding allocated that year for the RADARSAT Constellation Mission (RCM).

These items are funded on a project by project basis and not from the base funding.

And while it's common knowledge that the CSA is only allowed to reallocate it's base budget and is restricted in what it can do with project funding for programs like Radarsat Constellation Mission (RCM) and other programs as listed on the "Government of Canada, disclosure of grants and contributions awards for the Canadian Space Agency," it's also generally conceded that CSA subcontractors would prefer less oversight and more project funding.

But that's not the whole story. Most Federal government procurement includes a "risk reduction" mechanism, where a government department will often hold back a proportion of the final payment to contractors until milestones have been achieved and/or the contract is complete.

Governments do this in an effort to cost costs and maintain leverage over their contractors. These "contingency fundbacks" are normally small, especially when the provider is a large, well respected company performing well understood work.

Governments and private sector organizations often maintain "contingency funds," a reserve of money set aside to cover possible unforeseen future expenses. When those unforeseen circumstances fail to materialize, the funds are rolled over into the next project. Image c/o The Canadian Encyclopedia.

But fundback requirements typically increase when the contractor is smaller, inexperienced, a start-up or if the required work contains a large research and development component.

You know. Like the innovative new projects often contemplated by the CSA.

When a project doesn't pan out, the funding normally is either rolled over into the next year to try again (something called "re-profiling") or the funding is cut off and the contractor is required to repay the portion of the work considered incomplete.

Sources have indicated that some of the Canadian government fundbacks for R&D focused work hover around 40% or more of the total contracted worth although the average is normally far less. Understanding fundback requirements and how funds are often provided in increments contingent on completing milestones would go a long way towards explaining why the CSA seemingly spends so much less than it gets.

After all, R&D projects don't always work out the way people intend. When failures happen, good government procurement people spending the taxpayers money do what they're supposed to do. They cut their losses and retrieve what funds they can.

But that ongoing pot of unused funds also makes it difficult to request additional funding for new programs from the treasury.

For example, as a side effect of the government fundback requirements, CSA contract managers have a reputation of pushing hard to get more work for less money. In most cases, they're not allowed to dig in to the fundbacks and contingency funds. The end result is that they have a pot of unused, but allocated funds available between December and March of each fiscal year which can't be spend on other items.

But while bureaucrats and project managers might insist that they need more, a cursory audit would show extra money in the bank and turn any new funding request into an uphill battle.

This is how Federal budgets work. Objecting to this, as seems to be the case with the SpaceQ post, is not the sort of argument which will reinvigorate our CSA or free up additional funds for government funded projects.

As outlined in the May 17th, 2011 BBC News post, "What is debt 'reprofiling'," the term is common enough in international financial circles and is a type of restructuring, in which known financial responsibilities are stretched out over a longer period of time, but the overall value of those responsibilities remains the same. It's considered to be a little better than simply modifying or changing financial commitments unilaterally and much better than reneging on commitments previously made (which is also known as taking a "haircut"). Screen shot c/o BBC News

As outlined in a February 16th, 2018 e-mail from Julie Simard, the strategic manager of communications for the CSA:
As you know, space projects are complex, with changing requirements, and are generally spread over a long period of time. They are in fact the epitome of innovation, in which we constantly push further scientific research, knowledge and technology. 
For this reason, and as part of sound management practices, the CSA plans some contingency funds for each project in order to help mitigate risks and ensure their successful delivery. The percentage allocated to the contingency funds varies from one project to another, but also to the project phase. 
Contingency funds are released when they are no longer needed, all along the project duration. Contingency funds are necessary and allow the CSA to remain agile, flexible and being able to react to unforeseen situations.
It's also worth noting that, as outlined in the February 15th, 2018 Space News post, "Canadian Space Agency president not surprised by NASA ISS transition plans," CSA president Sylvain Laporte is taking a "wait and see" approach to NASA’s plans to end funding of the International Space Station (ISS) in the mid-2020s, in order to help fund the proposed Deep Space Gateway, a follow-on plan which CSA hopes to build a mission around, after the ISS shuts down.

In essence, the CSA is waiting for a mission, not an audit.

Back to you, SpaceQ.
Chuck Black.

Chuck Black is the editor of the Commercial Space blog.

Monday, February 12, 2018

Revisiting "A Nautilus-X for the Next 'HMCS Bonaventure'"

         By Chuck Black

It goes back to the July 4th, 2011 post "Ground Control to Marc Garneau," a critique of the Canadian Space Agency (CSA) and it's focus on building rovers and components to sell to other space agencies, almost to the exclusion of innovative and useful domestic space focused projects.

That story spawned more than its fair share of private and public comments, most of them focused on how much easier it is to critique a plan of action than it is to originate one.

Those comments, perfectly reasonable as they were, got addressed in the July 5th, 2011 post, "A Nautilus-X for the Next 'HMCS Bonaventure,'" which suggested that the best way to build a space program would be to pick a difficult goal which very few felt could be accomplished, then inventory the potential subcontractors to see where the existing expertise happened to be located and then assess whether or not the project could actually be made with the available resources.

We even suggested calling the end result HMCS Bonaventure, after Canada's last aircraft carrier. Which is kinda like what Hawthorne, CA based SpaceX did after its founding in 2002, except for the part where it's named after an aircraft carrier.

And look where SpaceX ended up. As outlined in the July 5th, 2011 post, Canada could certainly do the same:
...there are several obvious research areas where a bit of judiciously provided Federal government money (or private sector Canadian funding) could make the difference in guaranteeing future Canadian space competitiveness across a wide range of opportunities. 
These potential research areas and emerging technologies aren't focused on unmanned robotics or simple Mars rovers. Instead, they are directly applicable to solving propulsion, orbital construction and environmental/ habitation concerns relating to long duration, manned, interplanetary spaceflight. 
This makes them a far better way to ensure the continuation of the Canadian astronaut corps than anything wrapped around unmanned activities could ever possibly pretend to be...

That post also suggested that there were "four specific areas where Canada could contribute, right now, to the proposed Nautilus-X interplanetary spacecraft as described in the February 14th, 2011 Popular Mechanics article "New NASA Designs for a Reusable, Manned Deep Space Craft, Nautilus-X" or to any other manned spacecraft program for that matter."

Those areas included
  • Expertise developed building the Canadarm and the Canadarm II for the International Space Station (ISS)., through the then Richmond BC based MacDonald Dettwiler (MDA), now a subsidiary of San Francisco, CA based Maxar Technologies.

Keep in mind that this proposal came out long before the April 22th, 2016 post, "2009 Canadian Space Agency Report on Indigenous Canadian Launcher said "Yes!" But CSA Didn't Move Forward," which reported on how CSA subcontractors had inventoried Canadian capabilities to build orbital capable rockets in 2009, found that their construction was an achievable domestic goal, but did not move forward when the CSA decided not to release the documentation related to the project and/or actually building something.

These days we could probably recommend something far more substantial, and we could do so without the CSA's involvement.

While MDA is no longer Canadian and CanALSS seems to have fallen off the funding grid, there may be far more appropriate and capable replacements for the Canadian organizations listed in the earlier post.

Canadians certainly don't need to become part manufacturers or subcontractors for other space agencies.

We can still choose our own path.
Chuck Black.

Chuck Black is the editor of the Commercial Space blog.

Those European Bureaucrats Subtly Sneering at Elon Musk Likely Won't Get the Last Laugh

          By Brian Orlotti

European Space Agency (ESA) Director General (DG) Johann-Dietrich "Jan" Wörner has finally come clean with a public admission that the advent of reusable rockets and new manufacturing technologies from "NewSpace" firms like SpaceX, Blue Origin and Rocket Lab poses a threat to European space leadership.

ESA DG Jan Wörner's public lecture on "Driving Space 4.0 – an enabler for Entrepreneurship and Innovation" at Tallinn University of Technology during his visit to Estonia on September 15th, 2016 and John Cleese as the French taunter in the 1975 British slapstick comedy film "Monty Python and the Holy Grail." When it comes to rockets,Wörner and his ESA member nations along with their space agencies (including the Canadian Space Agency, an "associate member"), simply don't believe they need anything new or reusable. "I told them we already got one," they've said up until now, much like Cleese's character. Images c/o Youtube/ Python (Monty) Pictures.

In a February 11th, 2018 post on the ESA DG's personal blog under the title, " Europe's Move," Wörner noted severe upheavals in Europe over the 2016 UK Brexit vote, plus continuing economic and social troubles.

Then, in a prime example of how the rise of NewSpace is re-energizing global space efforts, Wörner called for “disruptive innovation,” with ESA member states contributing to finance the development of a new European reusable rocket.

In one paragraph, Wörner, in a textbook case of bureaucratic butt-protection, stated that in a 2014 ESA meeting, he had put forth reusability amongst the high-level requirements for the development of a new line of Ariane and Vega rockets (Ariane 6 and Vega C). But due to “time and cost pressure,” this requirement did not make it onto the agenda.

Wörner then, in a show of icy pragmatism, admitted that the world has changed and that Europe must consider new ideas and adapt, even as it now tastes the consequences of its slackness.

Readers of Wörner’s post could also detect the smoldering jealousy at SpaceX’s success, as shown in this passage:
One particularly powerful example is in the launcher sector, where global competition has been intensifying with the advent of very cheap systems. 
In addition, breakthrough developments from new space sector players such as reusable launchers and marketing wheezes like sending a car into space are attracting attention and increasing pressure on the public sector.
Wörner closed off his post by stating that French and German leaders are now supportive of  disruptive space technology. He quoted a Sept 26 2017 speech by French President Emmanuel Macron at the Sorbonne in which he stated, “I want to see Europe take the lead in this radical innovation revolution.”

Wörner also quoted from an agreement from Germany’s coalition government, “We are committed to maintaining the European Space Agency (ESA) as an independent international organisation and intend to strengthen it further.”

What satisfaction, what fulfillment, what joy it must be to SpaceX CEO Elon Musk to be damned with faint praise by the very bureaucrats who sneered at him 15 years ago. As the NewSpace industry shines in triumph, we are reminded of the wisdom of Frank Herbert’s words.

Graphic c/o AZ Quotes.

Leaders in France and Germany have expressed their backing for more disruptive actions with, for example, French President Emmanuel Macron making multiple references in his speech at the Sorbonne on September 26th, 2017 to encourage “l’innovation de rupture” or disruptive innovation, as a major strategic priority for Europe before adding:
Je souhaite que l’Europe prenne la tête de cette révolution par l’innovation radicale. (translated as "I want to see Europe take the lead in this radical innovation revolution").
Similarly, the coalition agreement between the two political parties in Germany published in recent days provides a sound foundation for such a step:
Wir setzen uns dafür ein, die Europäische Weltraumorganisation (ESA) als eigenständige internationale Organisation zu erhalten und wollen sie weiter stärken (translated as, "we are committed to maintaining the European Space Agency (ESA) as an independent international organisation and intend to strengthen it further).
But words need to be followed up by actions. As outlined in the December 14th, 2018 EuroNews post, "Race to build Ariane 6 rocket launch pad," while most believe that the current ESA Ariane 5 rocket cannot compete with current SpaceX launchers such as the Falcon 9 and the Falcon Heavy, there are still four long years before the next launcher in the Ariane rocket family, the Ariane 6, is expected to be ready for its first launch.

Will the Ariane 6 be able to compete against SpaceX? According to Wörner, without substantial changes in design to include reusability, it likely won't.

Time to watch those sneers turn to fear.
Brian Orlotti.

Brian Orlotti is a regular contributor to the Commercial Space blog.

Friday, February 09, 2018

The Battle of the Space Billionaires

         By Chuck Black

The successful launch of SpaceX's first Falcon Heavy rocket from NASA's Kennedy Space Center in Florida earlier this week is a reminder that, where once space was a proxy battlefield between world powers for glory and scientific advancement, the modern space race is more of a business venture waged by eccentric, real life superhero stand-ins who run multi-billion dollar companies.

Has anyone else noticed the obvious similarities between this picture and the opening of the 1981 animated sci-fi movie "Heavy Metal?" According to the February 8th, 2018 CNBC post, "Elon Musk shares the epic last photo of 'Starman' in the red Tesla he shot into space," this was the last picture SpaceX was able to get of the Tesla Roadster it sent into space on Tuesday. But don't panic. There are plenty more billionaires intending to do similar things who are currently gearing up for their moment in the sun. Photo c/o SpaceX.

At least that's the context behind the February 8th, 2018 Sky News post, "Who's winning battle of space race billionaires?," which gives a quick update on those in the forefront of current space exploration.

They include SpaceX's Elon Musk, Blue Origin's Jeff Bezos and Virgin Galactic's Richard Branson.

According to the August 21th, 2017 Bloomberg Technology Post, "Billionaire Moguls Join Musk, Bezos in Race to Outer Space," sixteen of the world’s 500 richest people have an investment in a space enterprise, according to data compiled by the Bloomberg Billionaires Index and consulting firm Bryce Space & Technology.

According to the post:
While technology tycoons dominate, the list also includes casino magnate Sheldon Adelson, who’s backing a lunar mission, and Mexican retail and banking billionaire Ricardo Salinas, an investor in satellite network OneWeb.

Of course, billionaires are seldom the first to enter into new markets.

As outlined in the January 18th, 2018 post, "Private Investors Poured $3.9Bln into Commercial Space Companies Last Year,"  a record 120 private firms made investments in space in 2017, well over the previous peak of 89 in 2015.
Editors Note: Ex-NASA deputy administrator and current general manager of the Air Line Pilots Association (APA) Lori Garver thinks the current entrepreneurial space race will help to re-invigorate NASA as it begins to adapt many of their new tools. 
As outlined in her February 9th, 2018 The Hill editorial, "SpaceX could save NASA and the future of space exploration," the real question to be answered in Washington now is, "why would (the US) Congress continue to spend billions of taxpayer dollars a year on a government-made rocket (the Space Launch System or SLS) that is unnecessary and obsolete now that the private sector has shown they can do it for a fraction of the cost (with the Falcon Heavy)?"
Chuck Black.

Chuck Black is the editor of the Commercial Space blog.

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