NASA will award up to $400 million to private companies to develop more space stations

The privatization in the space sector has become a common thing in the past few years and now NASA wants to take this to a new level by offering up to $400 million in funding to as many as four companies to develop private space stations for low earth orbits (LEO) under its Commercial LEO Destinations (CLD) project.

According to CNBC, NASA has announced the Commercial LEO Destinations (CLD) project last week. And as a part of this initiative, the agency will award up to $400 million to as many as four companies to develop private space stations for lower orbits, starting from Q4 2021.

With this project, NASA wants to replicate the success of the agency’s Commercial Cargo and Commercial Crew programs that saw private companies like SpaceX send cargo and astronauts to the International Space Station (ISS) for NASA and saved between $20 to $30 billion of agency’s budget.

“If it were to always remain that way, our aspirations in low Earth orbit would always be limited by the size of NASA’s budget,” said LEO director Phil McAllister. “By bringing the private sector into these sections and into these areas, as suppliers and users, you expand the pot, and you have more people in low Earth orbit.”

Motivating factors for CLD project

One of many motivating factors behind doing this project is the potential cost savings of NASA being a user of space stations, rather than an owner and operator. Operating research lab floating space costs the agency about $4 billion a year. The development and construction of the ISS cost about $150 billion, with NASA picking up most of that bill while Russia, Europe, Japan, and Canada are contributing.

Another motivating factor for this project is the age of the ISS (International Space Station), which has been in orbit for more than two decades now. As most of the space station’s core structures were manufactured in the 1990s, NASA is pushing the CLD program to offer an overlap in terms of new habitats before the ISS is retired.

“The ISS is an amazing system but, unfortunately, it won’t last forever,” McAlister said. “It could experience an unrecoverable anomaly at any time.”

A final announcement from NASA about CLD proposals will be released in May, with the first phase of funding awards expected between October and December.