A Report on the Development of a National Space Infrastructure to support the Global Competitiveness of the Canadian Space Industry Prepared by Denis Douville / Michael Faulkner / Anthony Kittridge Lansdowne Technologies Inc. 1001-275 Slater Street Ottawa, Ontario K1P5H9 July 14, 2012 The Development of Canada’s Space Infrastructure Executive Summary EXECUTIVE SUMMARY This report has been prepared in response to a contract issued to Lansdowne Technologies Inc. by the Aerospace Review Secretariat of the Emerson Commission. It presents an assessment of Canada’s Space Infrastructure with the objective of identifying a business case for the Government of Canada to invest in the maintenance and development of a national space infrastructure that could help support the competitiveness of the Canadian space industry in taking advantage of global commercial opportunities and assist the Canadian space sector to respond to strategic national priorities. Lansdowne was specifically asked to: 1. identify the types of space infrastructure in use globally to support the space sector and list the elements of Canada’s current space infrastructure; 2. explore Canada’s needs for additional space infrastructure to serve its medium and long term priorities; 3. identify Canada’s particular global advantages for supporting space infrastructure including our industrial base, technologies and geography; 4. describe the business case for investing in space infrastructure and provide a rough approximation of the associated costs; and, 5. describe the various funding models used in other countries to support space infrastructure and identify those models that might be applied in Canada. Significant research and analysis of national and international current state, structure and future requirements for space assets and supporting infrastructure has been undertaken over the last 5 years. This report has combined this third party research with the experience of the Lansdowne team to derive the conclusions drawn herein The economic and social benefits that derive from investment in the space sector have been substantiated in numerous analyses and reports such as the Organization for Economic Cooperation and Development’s (OECD) annual series of The Space Economy at a Glance1. As a result, this report does not attempt to provide a fundamental economic, political or social justification for investment in the space sector. Rather, it speaks to the specific Canadian need for space infrastructure, Canada’s strengths and weaknesses in this sector and the resulting priorities for investment. What is Canada’s Space Infrastructure? For the purposes of this report, Space Infrastructure has been defined to include the ground- based infrastructure necessary to support the design, development, manufacture, test, launch and operations of space assets and space-based applications. This includes: Research and Development (support to the design and development of space technologies); Integration & Test (support to the testing and verification of mechanical, thermal, electrical and control systems for space based assets); Canadian Industrial Capacity (the capacity, capability and facilities 1 OECD (2011), The Space Economy at a Glance 2011, OECD Publishing, http://dx.doi.org/10.1787/9789264111790.htm A Report for the Review of Aerospace and Space Programs and Policies I The Development of Canada’s Space Infrastructure Executive Summary resident within the Canadian space industry); Launch facilities (support to payload launch and launch vehicle integration); Training Systems and Facilities (support to the training of space technology users or operators); Data Reception and Processing: (support to the receipt and processing of satellite signals originating with space-based assets); and, Operations / Command Systems (support to the command and control of space-based assets). This report includes an inventory of this ground based infrastructure. What Are The Associated Needs and Benefits? In examining the needs for and opportunities afforded by the development of Canada’s space infrastructure, consideration has been given to all of the key stakeholders in Canada’s space program: the Canadian federal and provincial governments, Canadian industry and the Canadian public. The needs of key federal government departments who will employ the products provided by a robust domestic space industry have been examined focusing on the six key departments which have a direct investment in and responsibility for the operation of public assets within Canada’s space infrastructure. These key departments have driven the industry to provide those products and services needed to support the social and economic needs of Canada with its vast and varied geography: communications, resource management, transportation, safety and security. These needs will grow if Canada is to face the challenges associated with meeting this government’s economic, northern and defence strategies and priorities. Provincial, territorial and municipal governments have also been beneficiaries of Canada’s space sector investments through regional distribution of economic benefits and access to space based assets for resource management and emergency management planning and response. The Canadian space industry, with the support of government investment in space, has produced jobs for highly skilled workers and strong export sales based upon intellectual property and competitive world-class technologies. This success extends beyond the manufacturers of space assets to include firms that commercially exploit the products and services which these assets generate. The space industry will continue to need focused government investment to maintain its competitive advantage. Canadian universities and researchers have also contributed significantly to and benefited from the success of Canada’s space program by identifying science priorities, by providing scientific support and by designing, developing and operating science payloads. The result has been world-class science related to atmospheric physics and chemistry and auroral phenomena – to name just two disciplines – that contribute to the global understanding of our climate and increase Canada’s intellectual capital. The Canadian public has benefited directly and indirectly from Canada’s work in space both socially – with our communications and earth observation assets – and economically with jobs and increased economic activity. The Canadian Space Program has been a source of national pride and has helped establish Canada’s position as a technologically sophisticated nation and a valuable international partner. The Canadian public stands on the threshold of significant social and economic change as a result of the changing northern climate and the opportunities – and challenges – presented by this change. Canada’s Space Infrastructure will be a key component to managing and exploiting that change. A Report for the Review of Aerospace and Space Programs and Policies II The Development of Canada’s Space Infrastructure Executive Summary A key objective of investment in Canada’s space infrastructure should be to ensure that Canada’s space industry has the tools to effectively deliver services to Canadians while competing in international markets and exploiting the needs of our international partners by leveraging the competitive advantages that result from our technological expertise, intellectual capital, and geography. What is the Environment for the Space Sector? Canada was one of the first three countries to enter space and the first to design, construct, launch, and operate a commercial domestic satellite communications system. In 1960, Canada contributed space hardware to the U.S. navigation satellite Transit 2A, a precursor to the now ubiquitous Global Positioning Satellites (GPS). By September of 1962, Canada had launched Alouette 1 – Canada’s first domestically designed and built satellite and by November of 1972 it had launched Anik A1, the first domestic commercial communications satellite in geostationary orbit. Since the launch of that first sounding rocket in 1958, Canada has continued to build the infrastructure required to support a Canadian space industry. The 2011 OECD report on the space economy indicates that in 2010, the Canadian space-related ground segment revenue including applications and services was over $2.9B. However, the near term future of the space sector – domestically and internationally - will be directly affected by the global economy. Budget deficits in Canada and the US combined with the debt crisis in Europe will dictate budget restrictions on spending in space for all of the traditional major space faring nations. Only with investments made by major new players – such as China and India - with their continuing economic growth and desire to become a major players in the space sector will spending in the space sector increase. On March 27th of 2012, Euroconsult a leading international research and analysis firm specializing in the space sector - announced that global government budgets for space programs have reached a plateau of roughly $70 billion, confirming a slowdown in expansion experienced by the space industry for the last 10 years2. According to Euroconsult, many space programs have received recent short-term boosts to counter the economic crisis but they will now experience budget reductions in response to the impacts of the global economic situation. New coherent long term space strategies are required to leverage national investments