A Review of Costs of US Evolved Expendable Launch Vehicles (EELV)

Edgar Zapata

National Aeronautics and Space Administration, Kennedy Space Center

Summary

Much debate has centered on the real costs of the United States Evolved
Expendable Launch Vehicles (EELVs) and associated infrastructure. Often
the consideration of cost is phrased in terms of systems that do not
carry humans "versus" the Space Shuttle Human Space Flight Operation.
Naturally, as NASA moves to the new human space flight architecture, the
Constellation program, there is a desire for comparisons to the most
recent expendable systems developments. The most recent US launch
vehicles and systems developed and now operating are the Lockheed-Martin
Atlas V and the Boeing Delta IV.

Nonetheless, valid, transparent comparisons between Human Space Flight
and Expendable systems have been prevented by various roadblocks. First,
detailed cost data for the EELVs has been designated "sensitive",
"classified", or worse, "proprietary" under assorted National Security
justifications or as simply standard operating procedure. This makes any
comparison to the Space Shuttle, a highly studied program with a
relatively well documented cost picture, impossible simply for lack of
EELV cost data of any quality. Second, even when some data has been
accessible to a select few, a good picture of EELV costs can never
evolve within the process of critique and broad peer review by the
interested community to a degree that creates broad consensus as to the
meaning or validity of the data or comparison. Numbers never pass the
level of the anecdotal. Third, the comparison of Human Space Flight vs.
Expendable Launch Vehicles is beset by the syndrome of comparing
un-equal requirements. What would a Shuttle cost, minus a crew, with an
expendable cargo carrier, but with a commercial payload, as a service
contract? What would an EELV cost equivalent be to meet the Shuttle
fleets combined human, cargo and scientific experiment / on-orbit time
requirements in any given year? This may be as easily resolved as asking
weather apples or oranges taste better.

The un-ambitious purpose of this paper, therefore, is to review and
compare what has been said in the interest that continued discussion
keeps the topic relevant. By being relevant it is possible that one day
more openness will surface as to EELV production and operations so as to
improve our journey to space. [Hence the resulting heavy use of
footnotes.]{.underline} By comparing public sources the later issue of
fair "apples to oranges" comparisons will be enhanced, if not resolved,
for future consideration.

> *"Give me a recent business graduate and access to the internet, and
> we can deconstruct any companies costs within plus or minus 10% in 24
> hours"* - Opening Presentation \[remarks/speech\] Supply Chain World
> North America 2006, "Integrating for Efficiency, Productivity and
> Growth", Robert W. Moffat, Jr. - Senior Vice President Integrated
> Operations- IBM

  ----------------------------------------------------- ----------------------------------------
  ![](media/image1.jpeg){width="1.7201388888888889in"   ![](media/image2.jpeg){width="1.575in"
  height="1.1916666666666667in"}                        height="1.1791666666666667in"}

  An Atlas common core booster in the Atlas Spaceflight A Delta common core booster in the Delta
  Operations Center (ASOC)                              Horizontal Integration Facility (HIF)
  ----------------------------------------------------- ----------------------------------------

#  Background

The EELV program set off as an in-direct result of numerous events, such
as Challenger in 1986, and more directly from momentum and numerous
studies that justified updating aging, costly, expendable flight and
ground launch systems. One Cold-war remnant, the Titan 4, ran a steady
bill of about [^1]\$1B per year even when launches steadied at only 2
per year for many years. The original EELV plan in 1995 was to have
various contractors compete in developing new systems to win what would
eventually be awarded as a [^2]single contract for Department of Defense
(DoD) launches. The winner would be expected to supplement the yearly
manifest with commercial launch contracts. Any large military-industrial
/ aerospace contractors that were on the losing side of the bids would
still have growing commercial launch prospects as well with which to
persist as a national asset in the business of launch. When the global
commercial launch market [^3]tanked, instead, the DoD awarded two
contracts to proceed toward establishing new launch capabilities in
[^4]October of 1998, thus maintaining strategic national capabilities.
Tactical [^5]redundancy was argued as an added benefit of this
acquisition approach. Should one system fail and be grounded for the
duration of an investigation or test-fail-fix cycle, another would still
be readily available. [^6]Abandoning any semblance of competition was
further solidified by 2005 as re-negotiations ensued to establish new
contractual agreements between DoD and the EELV providers.

The first Atlas V lifted off from Cape Canaveral in August 2002 and the
first Delta IV launched in November 2002. Both were successful.

  ---------------------------------------------- ------------------------
  ![](media/image3.jpeg){width="1.55in"          A Delta IV Heavy Launch
  height="2.01875in"}                            

  ---------------------------------------------- ------------------------

#  EELV Costs -- What are we Talking About?

Any foray into costs needs basic definitions.

-   [Price]{.underline}: That amount of funds usually defined as a
    procurement, acquisition, purchase, material, service or otherwise
    external cost to the buyer of the launch vehicle service, exclusive
    of payload costs which are internal facing to the customer. These
    are funds that transfer from the customer and are received by the
    provider.

-   [Total Costs to the Government as DoD]{.underline}: That cost to
    interface, manage or otherwise assure, communicate, convey, enable
    or work with the launch provider such that requirements are assured,
    from the perspective of the customer, as having been satisfied by
    the launch provider. Includes Air Force personnel, contractors
    supporting these and any related charges that assist in interfacing
    the customer to the provider but which are not part of the funds
    transferred nor part of the "price". Also includes any necessary
    support provided as a direct transfer by the government, such as for
    infrastructure, to assure the launch provider's costs not adequately
    addressed in any price associated with direct launch activity are
    reimbursed. Also includes the "price" and therefore reflects a total
    cost.

-   [Total Costs to the Government as NASA]{.underline}: Similar to the
    prior definition for DoD, with one exception, that NASA does not
    bear primary responsibility for the management of the program nor is
    NASA required to contribute towards infrastructure as is DoD (more
    on this ahead). Includes civil servants, contractors supporting the
    civil servants, and any related charges that assist in interfacing
    the customer to the provider but which are not part of the funds
    transferred nor part of the "price".

The later "costs", to the Government, are the focus here. These may also
be thought of as "expenses" due to a necessary distinction related to
*actual launches*. In such government operations, from a DoD
perspective, failure to produce, in this case launches, may not result
in actual savings or any cost avoidances. When technical or other launch
issues arise the strategic and cultural notion that "we're in this
together" over-rides any consideration that a product has not been
delivered as promised and paid for. It is considered that to do
otherwise would, given that problems will inevitably arise, only destroy
the national capability to launch national security payloads. Volatility
would reign, as players would enter and leave the market routinely,
which is not tolerable to National Security. Therefore, regardless of
launches, expenses are incurred generally in alignment with *plans for
launches*, not actual launches, as plans affect production, on-going
capability, and so forth. Therefore, expenses, or that is "real costs"
will often have nothing to do with launches. Additionally, the launch
industry in general, and this equally applies globally, is relatively
immune at each national level from the vagaries of competition. In this
industry, even after contracts are signed that state a price, or after a
yearly budget cycle is over, it is possible to cover a contractors
[^7]losses from one year in a subsequent year, to make them whole. One
could imagine the response of government procurement officials and
lawyers to a small business request that more money be paid today for
what was already contracted via fixed-price contracts, paid for in full,
and delivered some years before.

# EELV Costs - Initially

[^8]In 1998 EELV initial launch services contracts were awarded that
pegged the cost of each launch to the Air Force at ***\$72M*** each. It
was still in program documents that these launch costs be a reduction
relative to past launch costs--

> "[^9]*We want to develop a family of vehicles that is technically
> achievable and costs 25% less (threshold) than current systems with an
> objective of 50% reduction in the cost of spacelift."*

# EELV Costs -- Eventually

By 2001-2002 launch costs to NASA were in the range of
[^10]***\$87M-\$107M*** (Figure 1).

Eventually it became clear that the costs perspective provided early in
the EELV program hinged on volume, whereby commercial customers would be
so abundant as to cumulatively contribute, in the commercial prices
charged, to defraying an assortment of costs.

![](media/image4.jpeg){width="5.200694444444444in"
height="2.689583333333333in"}

Figure 1

Just one year later, in 2002 the notion that fixed costs existed was
becoming accepted --

> "[^11]*Sources tell this column that the package will be \"in the
> range of \$350 to \$400 million initially and will compensate Boeing
> and Lockheed Martin for the cost of maintaining the full range of EELV
> configurations now in existence."*

By 2005 other [^12]information was made public that the above
non-recurring infrastructure charge ended at \$340M in the fiscal year
2006 budget. Similarly, per launch pricing had increased from the
initial 1998 value of \$72M a launch to ***\$170M*** a launch, but this
had already been established in previous award updates --

> "*Furthermore, Arnold \[Lt. Gen. Brian Arnold\] says the actual
> pricing is not expected to change dramatically. Based on the Fiscal
> 2006 budget request, an average EELV launch and associated services
> cost about \$170 million".*

Compounding the confusion amidst the escalation in price was the
apparent occasional attribution of non-recurring development costs into
the EELV per launch costs such as [^13]quotes surfaced at **\$230M** per
launch in the 2004 timeframe.

Lastly, even the infrastructure payment per year had become debatable as
"[^14]The total EELV sustainment payments from 2004-2020 average \$818
million per year on a straight-line basis."

As shown, numerous sources appear to have reverse calculated EELV
"costs" or "expenses" in some very useful ways, regardless of designated
claims of sensitive, classified or proprietary. Two basic categories
repeat, well known from Business 101. Costs are fixed and variable, with
variable assuming some level of production (otherwise it would mostly
all be fixed).

# Some Source Data

It is of value to seek source data for EELV, on a par with high-level
Shuttle budget documents and costs analysis which abound. While some
[^15]excellent distillations exist on the subject of EELV costs, a
reference to the source of data and a walk-through of logic can serve to
further the development of standard definitions and thus understanding.

A year of interest is 2006, when a budget plan would show the actual
budget increase resulting from the new "infrastructure" hit. A
particularly useful site is the [^16][Defense Technical Information
Center (DTIC)](http://www.dtic.mil/dtic/index.html) (Figure 2).
Maneuvering through the site (DoD Websites \> Federated Search) can take
one to the [^17]R&D Descriptive Summaries database (Figure 3).

+-----------------------------------+-----------------------------------+
| ![](media/image5.                 | ![](media/image6.                 |
| png){width="2.9006944444444445in" | png){width="2.9006944444444445in" |
| height="2.2in"}                   | height="2.2in"}                   |
|                                   |                                   |
| Figure 2                          | Figure 3                          |
+-----------------------------------+-----------------------------------+

By using keywords such as "evolved" a user can call up material such as
shown in Figure 4.

![](media/image7.png){width="5.290277777777778in"
height="3.615972222222222in"}

Figure 4

Note the increase of \$331.06M going from 2005 to 2006, which would seem
to confirm via a direct Air Force public source document the
"infrastructure" cost correction previously referred to as in the
"*\$350 to \$400 million"* range (in 2002). More importantly, knowledge
of the planned / procured Air Force launches, removing any commercial
launches, would lead to a simple perspective on per launch costs as
follows in Table 1.

![](media/image8.wmf){width="6.508333333333334in"
height="1.5597222222222222in"}

Table 1

The number of DoD procured or planned launches can be gleamed from
complementary sources such as the Teal "World Space Systems Briefing",
"Atlas 5" section, but also by gleaming the phrase in the above Figure 4
*"...an estimate based on 95 AF launches in the current manifest, FY
2002-2020."* The number 6 used in Table 1 would derive from the Teal
report and is slightly higher than one would get by 95 launches over 18
years or 5.3.

In 2008 then it can be said, at least based on the prior, that if
procuring about 5 or 6 launches per year for the government, with a long
term plan of about 100 launches, then EELV launches will be a low of
1164/6 or **\$194M** per launch to a high of 1164/5.3 or **\$220M** per
launch. This would be a match to the definition of "price" to the
Government.

For a commercial customer the infrastructure subsidy can be expected to
lower the price, as it is picked up by the Air Force. For NASA this too
applies, as the launch provider does not attempt to recover this cost
for the Air Force via any other customers, even if government. But,
since the paradigm of "cost" in any case includes the cost to manage the
acquisition it is worthwhile doing an exercise as to what NASA EELV
launch costs would be for a few launches per year.

# NASA -- Other EELV Costs

NASA procures launch services from Air Force Expendable Launch Vehicles
via the NASA Launch Services Program (LSP). There are two data points
with which a bogey can be obtained here immediately. First to consider
is the size of the KSC Launch Services Program Civil Service. Second
would be the overhead attributable to these for KSC. Overhead in the
case of KSC would be 1^st^ order of the type referred to as "Center
Management & Operations" (with inclusion of the facilities line item,
and no further distinctions, as details into the nature of this overhead
or definition are not the subject of this review). The LSP program
consists of about 165 Civil Servants (obtained by counting the names on
the KSC LSP organizational chart, dated 4/02/02). Overheads, taken to be
proportional to that Shuttle is most of the KSC operation, whereas the
International Space Station and Launch Services Program are both in the
10% range, would be about 3:1 (for obscure reasons, again, not delved
into here). It can be shown, at various rates, that the total cost of
this fixed management, engineering and technical oversight, with
overhead support (procurement, finance, human resources, information
technology, security, etc) would be in the range of \$50 to \$70M a year
regardless of launch rate. Therefore, final "EELV costs to NASA" on
average, would be another \$15M to \$20M per launch. The total EELV
launch costs to NASA would then be in the range of **\$210 to \$230M**
per launch (assuming a steady few launches procured by NASA every year).

# Conclusions

1.  The United States EELV type dual-provider / dual infrastructure,
    providing anywhere from a few to upwards of 6 launches per year for
    the DoD, but generally regardless of total flight rate, is an
    upwards of \$1.2Billion dollar recurring yearly cost comprised of
    actual launch effort and, significantly, of simply maintaining the
    productive infrastructure.

2.  Acquisitions of such services can expect "prices" or "procurements"
    as external facing costs of at least \$200M per launch if such
    acquisition framing "per launch" can be achieved and is a paradigm
    or metric of some use.

3.  It is obvious that the matter of costs and launch vehicles continues
    to be an area where new ventures fail to communicate, by hiding,
    misunderstanding, neglecting to study, or simply misleading, the
    true scope of resources required to keep and operate a launch
    system. When congressionally mandated Nunn-McCurdy correction
    reporting reaches a scope of a program having to report jumps from
    [^18]\$18.8 billion to a \$31.8 billion, the situation is not only
    dire, it must by definition have poor estimation colluding with lack
    of interest.

4.  While high-level data sources and the varied mix of sources can
    reconcile to agree on some key EELV cost parameters, it is not clear
    without further detail that a true picture of EELV costs will emerge
    in the near future. The approval of the [^19]United Launch Alliance,
    merging Atlas and Delta, Boeing and Lockheed-Martin launch
    operations, can reasonably be expected, by way of full monopoly, to
    only make this lack of transparency worse. Future initiatives on the
    part of the Government should include the possible breakup of launch
    vehicle services from any spacecraft providers similar to the
    [^20]anti-trust guidelines that keep airliner manufacturers such as
    Boeing from owning airline operations such as American. Co-ownership
    is NOT healthy, long term. Immediately the cost of the launch would
    be visible, albeit at a high-level, as apart from the spacecraft on
    any bids, making it possible to compare a Northrop-Grumman or a
    Space-craft-R-Us proposal by a manufacturer only in the satellite /
    spacecraft business against any other (vs. trying to figure out the
    equalizing difference when a launch vehicle provider also bids for a
    constellation of spacecraft, to be launched on their own launch
    vehicles). The latter break-up notion could possibly interplay with
    any eventual merger between ULA and United Space Alliance (USA) at
    KSC (albeit opening new problems as to sheer size). In either case,
    initiatives exploring new legal or procurement methods should focus
    on having a healthy understanding of costs, which is critical to
    future US pre-eminence in space. You can not control what is not
    understood.

5.  Further analysis here would combine DoD "costs" and the actual
    commercial launches that are occurring into one cohesive picture.
    The later likely already contribute to keeping the costs discussed
    here from escalating even further. Again, a truthful analysis would
    distinguish fixed costs regardless of who is paying, rigorously
    studying and defining this category to include only those costs that
    are minimally required to provide at least 1 (and possibly zero) but
    no more than X number of launches per year. Variable costs would
    similarly be attacked. Lastly non-recurring capital expenses that
    occur when a launch rate jumps from X to Y would be separated. As
    with Shuttle, EELV visibility would be down to [^21]at least 8
    categories as follows - (1) contractor hands-on costs by task, i.e.
    technicians, on vehicle as well as for dedicated infrastructure, as
    labor-hours (2) contractor engineering, safety & quality, (3)
    contractor in-direct & program management (literally dozens of
    functions from work control to scheduling), (4) contractor
    logistics, (5) sub-contractors to the main contractor, (6)
    government direct employees (engineering & technical as well as
    direct management), (7) government in-direct (such as procurement,
    human resources, security, finance, etc), and lastly (8)
    infrastructure of the base or center type (i.e. basic roads,
    utilities and communications, etc). Some of these, such as
    government in-direct or base infrastructure, would be allocations
    off some total expense picture dependent on the size of the other
    EELV resources (categories 1-6) drawing on the later resources.

6.  Further debate is likely, and healthy, especially as regards
    infrastructure costs, who pays for what, and high-level comparisons
    against human space flight so as to define why no launch business,
    even after investing Billions in new systems, has failed to develop
    either new launch providers, or significantly greater access,
    [^22]tonnage, reliability or routine access to space and beyond.

# About the Author

Mr. Zapata has worked with NASA at the Kennedy Space Center for over 18
years. In that time he has held responsibility for Shuttle systems
including the Shuttle External Tank and the Shuttle cryogenic propellant
loading systems, and related systems. For over a decade he has worked to
translate the operations experience into improvements in flight and
ground systems design so as to achieve improvements in ground processing
operations from landing through launch, in all aspects from direct to
in-direct operations areas. Most recently he participated in the
Explorations Systems Architecture Study or "ESAS" contributing Launch
and Landing Ground Operations cost estimation and integration into
life-cycle cost analysis processes to decide the new NASA architecture
to follow the Space Shuttle. Mr. Zapata looks forward to a day when
access to space is safe, routine and affordable as a result of taking
advantage of, quantifying, and understanding the experience and lessons
of ongoing space transportation systems operations.

Edgar Zapata

NASA Kennedy Space Center, FL

KSC FL

32899

Mail-code IT-C1

321-867-6234

<edgar.zapata-1@nasa.gov>

[^1]: <http://www.fas.org/spp/military/program/launch/titan_c.htm> and
    <http://www.globalsecurity.org/space/systems/titan_c.htm>

[^2]: "The U.S. Evolved Expendable Launch Vehicle (EELV) Programs",
    Federal Aviation Administration, Commercial Space Transportation
    Quarterly Launch report, 1997 at
    <http://www.faa.gov/about/office_org/headquarters_offices/ast/media/sr_97_1q.pdf>

[^3]: The launch industry depression: when will it end? by Jeff Foust
    *Monday, March 17, 2003* at
    <http://www.thespacereview.com/article/10/1>

[^4]: <http://www.fas.org/spp/military/program/launch/eelv.htm> "The
    program office completed its Source Selection in October 1998 and
    awarded Development and Initial Launch Services contracts to Boeing
    and Lockheed Martin."

[^5]: Actually, satellite can not simply be moved, due to a delay in one
    rocket, onto another rocket. This tactical scenario may have had
    more to do with consideration of a catastrophic loss of a launch pad
    or long lead major piece of infrastructure than with the fanciful
    notion of actually re-booking satellites immediately from one
    vehicle to another after the failure of a vehicle, or a related
    satellite loss, during ascent or orbit insertion.

[^6]: "Rocket Boosters, To Prop Up Domestic Rocket Industry, Air Force
    Abandons Competition", Aviation Week & Space Technology, April 18,
    2005.

[^7]: Page 8 of GAO report "Defense Space Activities: Continuation of
    Evolved Expendable Launch Vehicle Program's Progress to Date Subject
    to Some Uncertainty" July 24, 2004 at
    <http://www.gao.gov/new.items/d04778r.pdf>

[^8]: i.e. dividing the total over the number of launches yields the
    \$72M/launch, at
    <http://www.globalsecurity.org/space/library/news/1998/b10161998_bt538-98.html>

    "The two companies are also being awarded contracts for Initial
    Launch Services for the Department of Defense\'s Evolved Expendable
    Launch Vehicle Program, the next generation of space launch
    vehicles, that total \$2.03 billion. Boeing will receive \$1.38
    billion, and Lockheed Martin will receive \$650 million. ... During
    the initial launch service phase, the Air Force will acquire
    commercial launch services for 28 government payloads scheduled to
    launch between fiscal years 2002 and 2006. Boeing will conduct 19
    launches and Lockheed Martin nine launches."

[^9]: "AIR FORCE SPACE COMMAND OPERATIONAL REQUIREMENTS DOCUMENT (ORD)
    II AFSPC 002-93-II FOR THE EVOLVED EXPENDABLE LAUNCH VEHICLE (EELV)
    SYSTEM" at
    <http://www.globalsecurity.org/space/library/report/1998/eelv-ord.htm>

[^10]: Discovery Program Workshop, ELV Launch Services, Darrel Foster,
    ELV Mission Management Office, July 24, 2002.

[^11]: "Spacelift Washington: USAF planning additional EELV funding" at
    <http://www.spaceref.com/news/viewnews.html?id=426>

[^12]: Aviation Week & Space Technology, April 18, 2005, "Rocket
    Boosters, To prop up domestic rocket industry Air Force abandons
    competition".

[^13]: Business Week, "The Air Force Fails Rocket Science", December 7,
    2005, Commentary by Stan Crock at
    <http://www.businessweek.com/bwdaily/dnflash/dec2005/nf2005127_4095_db046.htm>

[^14]: U.S. Air Force Can lead by Example on ULA, By [JIM
    McALEESE](mailto:) posted: 28 November 2005 at
    <http://www.space.com/spacenews/archive05/McAleese_112805.html>

[^15]: One of the most definitive write-ups on EELV costs, with most
    numbers already distilled, is that of Jim McAleese at
    <http://www.space.com/spacenews/archive05/McAleese_112805.html>

[^16]: DTIC at <http://www.dtic.mil/>

[^17]: R&D Descriptive Summaries database at
    <http://www.dtic.mil/descriptivesum/>

[^18]: Jim McAleese at
    <http://www.space.com/spacenews/archive05/McAleese_112805.html>,
    "This dominance by EELV of the Air Force Missile Procurement Account
    arose when the EELV program experienced cost growth in December
    2001, September 2002, and September 2003, before dramatically
    breaching the Nunn-McCurdy Act with an unexpected \$13.3 billion
    projected cost growth in December 2003, when the total projected
    EELV program costs for the period 2004-2020 exploded upward from an
    estimated \$18.8 billion to a projected \$31.8 billion. This was
    primarily due to the lack of a commercial launch vehicle market to
    absorb recurring overhead and allocable infrastructure costs."

[^19]: "United Launch Alliance nears approval" at
    <http://www.spacetoday.net/Summary/3309>

[^20]: White Paper: \"Independent Space Transportation Operator Concept,
    A Breakthrough Acquisition Strategy Using Independent Space
    Transportation Operators, Making Affordable and Sustainable Space
    Transportation Possible\", C. McCleskey, Systems Engineering Office,
    Spaceport Engineering & Technology Directorate, NASA John F. Kennedy
    Space Center, Florida, May 18, 2004. at
    <http://science.ksc.nasa.gov/shuttle/nexgen/space_trans_afford_main.htm>

[^21]: Is there anything else you would like with that Sir? Probably,
    such as associations to specific flows or specific budget years.
    Org. charts too.

[^22]: By way of example on tonnage per flight (*though per year is the
    more useful metric*), Delta VI tonnage to ISS, 407km X 407km, 51.6
    degress, is **22,560** kg using the Heavy configuration. Tonnage for
    Delta from the National Security Space Launch Report, page 18, at
    <http://www.rand.org/pubs/monographs/MG503/> The NASA Exploration
    program Crew Exploration Vehicle / Ares I requirement is given by
    the Constellation Architecture Requirements Document by "Orion shall
    have a Control Mass of **25,324** kg (55,830 lbm) at Lift-Off for
    the ISS Mission." Also "Orion shall have a Control Mass of
    **28,059** kg (61860 lbm) at Lift-Off for the Lunar Mission."