"Finding the Balance"
Dr. George C. Nield, Santa Clara, California
July 26, 2012

NewSpace 2012 Conference

Good afternoon.

I'm really pleased to have this opportunity to meet with you today to talk about what has been going on in commercial space transportation.

This has been a tough month for the aerospace community. Over the past couple of weeks, we've had to come to grips with the loss of two genuine superstars, two icons that each had a tremendous impact on our industry. Sally Ride, the first American woman in space, grew up here in California, earned a PhD in physics from Stanford, and was selected by NASA as one of the "thirty-five new guys", the first group of astronauts specifically chosen to fly on the Space Shuttle. In addition to twice launching to orbit as a Mission Specialist, she was a member of the accident investigation boards for both the Challenger and Columbia accidents, the only person to serve on both panels. She was also a member of the Augustine Commission, the group that was tasked with identifying potential options for our nation's space program following the retirement of the Shuttle. After leaving NASA, she taught at the University of California, San Diego, and later formed her own company to encourage young people, especially girls, to study math and science. We're going to miss her.

Someone else we're going to miss is Forrest McCartney. Lt General McCartney served our nation in a number of different roles, including as an Air Force officer, and as the fourth Director of NASA's Kennedy Space Center. Some of his assignments while in the Air Force included working at the Satellite Control Facility just up the road in Sunnyvale, playing key roles in the Titan III and M-X missile programs, and serving as the Director of Range Engineering at the Eastern Test Range. He also served as the Commander of Space Division at Los Angeles Air Force Station. General McCartney was a tremendous leader, and he had an ability to inspire the people who worked for him to give it their all, even under very challenging circumstances. He was also a master at managing risk, recognizing that spaceflight is inherently risky, but never taking unnecessary chances when it came to ensuring mission success or guaranteeing public safety.

One other person who recently left us all too soon was Stephen Covey, the well-known author and business consultant. Covey had a doctorate from Brigham Young University and an MBA from Harvard, and he wrote a number of best sellers, including "The 7 Habits of Highly Effective People", which is one of my favorite business books. According to Covey, one of the keys to success involves trying to change the existing paradigm in a particular situation, by helping those involved to see things in a different way. Actually, it seems to me that that may be one of the key ingredients to enabling our nation's space program to be as successful as we all want it to be in the future.

This year marks the 50th anniversary of the flight of John Glenn, the first American to orbit the earth. During those 50 years, we have had some remarkable triumphs and some heart-wrenching tragedies. But most of the time, our basic way of doing business in space has remained pretty much unchanged, with the government calling the shots and with industry being part of the team, but clearly in a supporting role.

Today we stand at the threshold of a new era in space, one in which private industry has the potential to really take the lead when it comes to transportation to and from low-Earth orbit, and for suborbital spaceflights. It is not yet evident whether the new approach will be successful, but it certainly represents a very different paradigm. I think it's fair to say that not everyone is comfortable with the change in direction. For the skeptics, I think it is important to be clear about whether their issue has to do with using different rockets, having different companies involved, or just implementing different acquisition strategies and contract types. As you know, a couple of months ago, SpaceX successfully demonstrated the capability to deliver cargo to the International Space Station as part of the Commercial Orbital Transportation Services, or COTS, program. I should note that both the launch of the Falcon 9 and the reentry of the Dragon spacecraft were licensed by the FAA. This Fall, SpaceX will begin flying regular cargo resupply missions to the ISS several times per year. Orbital Sciences Corporation is not far behind with its efforts, and they hope to demonstrate their new vehicles with launches from the Mid Atlantic Regional Spaceport in Virginia, later on this year.

What about human spaceflight? Well, with the retirement of the Shuttle, right now we are dependent on Russia to take our astronauts to and from the ISS, at a cost of over $60 million per seat. American industry thinks it is ready to step up to the plate, and NASA is currently smack dab in the middle of the selection process for the Commercial Crew Integrated Capability, or CCiCap, program, with the goal of providing safe, reliable, and cost-effective transportation to low-Earth orbit. NASA hopes to be able to announce the winning teams very soon, either later on this month, or perhaps in August.

Because those commercial crew missions are going to be carried out by private industry, but in support of NASA's space station, there has been a lot of discussion in recent months about the government's roles and responsibilities – how are NASA and the FAA going to work things out? Who is in charge? And who will be ensuring safety?

For those who may have missed it, I am pleased to report that on June 18th, Charlie Bolden, the NASA Administrator, and Michael Huerta, the Acting FAA Administrator, announced the signing of a Memorandum of Understanding between our two agencies for the achievement of mutual goals in human space transportation. Under the terms of the MOU, for operational missions to the space station, commercial providers will be required to obtain a license from the FAA for the purposes of public safety. Crew safety and mission assurance will be NASA's responsibility. Now, there are still a number of technical challenges that need to be addressed. But with the MOU in place, I feel confident that NASA and the FAA will be able to work together to resolve the remaining issues, and answer any new questions that may arise. Pam Melroy, a three-time Shuttle astronaut who served as the Commander on STS-120, recently joined the FAA as our Senior Technical Advisor, and she has done a fantastic job of keeping our Human Spaceflight team focused on the key issues, and strengthening our partnership with the folks at NASA, both at the Kennedy Space Center in Florida, and at the Johnson Space Center in Houston.

So what are we trying to do? Well, it's really a question of finding the right balance. We want to take advantage of all of the knowledge and experience that NASA has accumulated over the last 50 years of human spaceflight. But at the same time, we don't want to put unnecessary limits on the creativity and innovation that American industry can bring to the table. It's also important to remember that in the future, not all human spaceflights will have NASA as a customer. Bigelow Aerospace may at some point be operating a commercial space station, serving sovereign clients from the international community or corporate researchers from the U.S. Space Adventures may be brokering launches for a new wave of space tourists, people who have long wanted to go to space and could even afford to buy a ticket, but who weren't really interested in having to learn to speak Russian and spending 6-12 months away from family and friends to train in a foreign country. I'm sure there are other companies that have different business models. But it seems to me that in the very near future, both the number and the variety of space launches will be increasing rapidly.

Taking things just a bit further, let's see if we can apply Habit Number 2 from Covey's "7 Habits" book: "Begin with the end in mind." What does that end goal look like?

If I pull out my crystal ball and look into the future a decade or two, I see government and industry working together, carrying out complementary operations in a mutually beneficial way. NASA is busy with a robust exploration program, and conducting scientific research on the moon, several near-Earth objects, and throughout the solar system. They are supported by a rapidly growing commercial infrastructure, with a commercial propellant depot to enable deep space journeys, multiple commercial space stations, and even a commercially provided habitat on the lunar surface. There is a thriving suborbital space tourism market, with several launches per day allowing thousands of people to personally experience spaceflight every year. Based on the research and technology development programs that the government has helped to fund, we will be seeing the start of point-to-point transportation through space, enabling rapid movement of both people and high-value cargo across the oceans and between the continents. Today we have eight licensed spaceports, in the future, we will have dozens, with each one focusing on a specific market niche – large geosat launches, smallsat launches, space tourism, research and development, spaceflight training, or point-to-point transportation.

In terms of safety, we want to significantly reduce the 2-percent fatal accident rate that NASA has demonstrated with the Space Shuttle. The current fatal accident rate for scheduled commercial airlines is about 10,000 times better than that, on the order of 1 in a million flights. Can space travel ever be that safe? I'm not sure, but there is no reason why we can't take some big steps in that direction. To do that though, we are going to need a lot more flight data. We will need to have a top-level, data-driven regulatory structure, that encourages both innovation and the sharing of lessons learned. Competition is good, but if we are going to be successful, we will need to figure out how to get past the challenges of competition and proprietary data so that each launch operator doesn't have to make the same mistakes over and over again. Once again, it's a question of balance.

As you may know, even though the FAA is responsible for regulating commercial human space flight, Congress has issued a moratorium on new regulations that are intended to ensure the safety of crew or spaceflight participants, until October 1, 2015, unless there is a fatal accident or a close call prior to that date. We have been encouraged to work with industry to better understand what those regulations ought to look like. But because of statutory constraints on the federal rulemaking process, we won't be allowed to talk about specific rules that we think might be appropriate, even if they are in draft form, until after that October 2015 date. So figuring out how to make progress, given all of the constraints, is going to be a challenge. In response, what we have decided to do is to hold a series of public telecons on a variety of specific regulatory issues, to allow the public, and the industry, to share their ideas with us on the best way forward. There will be a Federal Register announcement coming out soon that will have additional details. So please watch for it, and by all means participate in the discussions.

Just a quick update on some other items of interest. Our Commercial Space Transportation Center of Excellence is now up and running, with 9 different universities across the country doing some great research in support of both the government and the industry. And we are in the process of talking with other federal agencies, and with other universities, about how they can partner with us on this exciting project.

We recently issued an experimental launch permit to Scaled Composites for SpaceShipTwo, and we are looking forward to their first rocket powered test flights later on this year. A number of different folks are talking to us about applying for Spaceport licenses, among them Alabama, Colorado, Texas, Hawaii, and Puerto Rico. Several companies are in pre-application consultations with us on the potential benefits of getting a Safety Approval. And as you heard earlier today, we have just issued an RLV launch license to Armadillo Aerospace for their STIG B vehicle, that will allow them to participate in NASA's Flight Opportunities Program.

So we've been busy, but it's very gratifying to see the pace of activity starting to pick up in the commercial space arena. If we can just keep the right balance, I know some good things are going to happen.

Thanks again for inviting me to speak today, and I hope you enjoy the rest of the Conference.