Written evidence submitted by Mr Jack Cerullo and Dr Sarah Lieberman (SSS0013)

Dr Sarah Lieberman: Senior Lecturer Politics and International Relations – Canterbury Christ Church University. Author / Editor of “The Commercialisation of Space: Politics, Economics and Ethics” Published by Routledge in 2023.

Jack Cerullo: PhD Candidate Canterbury Christ Church University

Developing a commercial space sector in Scotland.

What are the key opportunities for the Scottish space sector in the coming years?

In 2022, the global space economy was $464 Billion. In 2023 it will reach $564 Billion and the Space Foundation annual report estimates that it will reach $800 Billion in the next five years. During this growth period, newcomers can establish a place within the Global Space Economy and set out a stall for future participation and economic development on space.

Scotland has an opportunity to join the global space economy. This will generate jobs, revenue, investment, and increased taxation income. The output figures will be entirely dependent on how much the Scottish Government and the UK Government decide to invest. Scotland has a chance to create a niche within the small satellite sector – providing a full service: innovation, development, manufacture, launch and data analysis can all be carried out in Scotland, but this requires initial investment and commitment on the part of the public sector.

The Global Space Economy, forms part of the wider International Political Economy. This is important to state geopolitical power. Space in particular forms an important marker of geopolitical and global structural power- the space race between the USA and Russia during the Cold War provides a clear indicator of this importance, and the current race back to the moon between China, Russia and the USA and its Artemis partners demonstrates that this remains important. Nonetheless, despite the geo-strategic and prestige importance of a state-based space programme, we note that the global space economy is mixed economy – currently we see an approximate 20% of the space economy state based, and 80% of the global space economy overseen by commercial entities. Thus, the space sector can be split into sectors: first and foremost, it is split into state based projects - funded by public money through taxation; and commercial projects – funded by private entities seeking to make profit. We also see a proliferation of public private investment partnerships which combine the two in different formats, with ownership and profit split along different lines.

Second, it is split into upstream and downstream sectors – technologies developed for launch and outerspace hardware are considered upstream technologies, those that are developed using space technology, and those that use space data, are defined as downstream technologies. Both are profitable, and Scotland could pursue both given its current range of expertise.

Third, we can divide the sector into different industries: upstream we note the development of space hardware – I,e, satellites, the construction of launch facilities, and the manufacture of ground facilities for information capture. Downstream we note data analysis and manufacture of hardware to utilise space information i.e. gps units, mobile phone technologies, satellite communication receivers etc.

The satellite industry generates the majority of the global space economy, and the majority of satellites are commercially owned. However, due to the nature of international law for outerspace as set by the UN Outer Space Treaty of 1967, states are responsible for material launched into space from their territories, and have liability for any damaged caused. Commercial entities rely on state based licencing bodies to allow for launch, and to provide guidelines on behaviour in space, and during launch.

Why Scotland?

The Scottish Government has stated that it would like to see Scotland become the European leader in small commercial satellites –the manufacturing, the launch, observation and analysis. Scotland is well placed to do this: More small satellites are manufactured annually in Glasgow than anywhere outside California. Scottish Development International classes Edinburgh as the space data capital of the world. Scotland has a long history dating back to the enlightenment in education, and has a proven track record in heavy industry illustrated by its oil industry, ship building, and Faslane.

Historically:

Scotland has a long track record of invention and innovation - Scots are credited with the invention of the television, telephone, and the steam engine - and many world ranking universities are situated there. Edinburgh University and Glasgow University are part of the prestigious Russell group of British Universities, while outside this group yet in the world’s top 200 universities, Scotland is also home to St Andrews University and Aberdeen University. Scotland prides itself on its history, including the enlightenment and new inventions throughout the industrial revolution. Furthermore, Scotland has a long history of manufacturing, and large-scale manufacturing. The Clyde shipyards and Faslane are two examples of Scottish manufacturing prowess, as are the North Sea gas fields and subsea oil.

Economically

The Scottish government has shown commitment to this sector, with investment in different areas. The Scottish government has stated that Scotland can provide a full value chain, and wants to make Scotland the place to establish a space company. Ultimately, Scotland is pushing to become the space capital of Europe and it is already beginning to lead Europe in end-to-end capability for small satellite design, manufacture and launch. Furthermore, it has the capability to provide earth observation data solutions, and has a clear sustainability focus that will be critical in tackling climate change.

This history, and this thirst for advancement puts it in the perfect position to undertake the next step in manufacturing innovation and practice: that for outerspace.

Geographically

Scotland could provide the perfect position for space launch. In terms of climate, Scotland is temperate and would provide consistently good conditions for launch. Furthermore, given its northerly position and surrounding open waters, Scotland could provide the UK, and indeed other commercial and state entities, with the possibility of uninhibited launch particularly into polar orbit – an orbit which is currently difficult to access due to geopolitical unrest and the Russian invasion of Ukraine, and Sun Synchronous Orbits. These orbits are useful for communication satellites and small satellites based around the northern hemisphere and are best accessed from northerly positions. For example, The Sutherland Spaceport on the A’Mhoine peninsula, which was granted planning permission in 2020 and started construction in 2023, sits at 58.5 degrees north as far north as possible on the UK mainland.

Spaceports:

Scotland’s geography and position mean that it is best placed to provide the UK with space access for satellite launch. This places the UK, in particular Scotland in an enviable position when compared to other European powers. The UK has an opportunity to become the European leader for small satellite launches. Five spaceports are currently in development: Shetland, Sutherland, Machrihanish - Argyll, Prestwick and Spaceport I in the Outer Hebrides.

This section will provide an overview of each.

Shetland - SaxaVord

This spaceport would be operated by Lockheed Martin who predict this spaceport will create 255 jobs and insert £4.9m into the Shetland Island economy each year. Shetland’s economy has been largely based on oil and gas for the past decades. This gives the area a good knowledge and understanding of manufacturing and industry, and, as the world shifts away from fossil fuels, provides an opportunity for upcoming necessary diversification.

Benefits:

History of heavy industry, manufacturing and innovation within the North Sea Oil and Gas industries.

Proposed by Lockheed Martin – established commercial space entity with track record stretching back to the Apollo missions.

Geographically well placed to reach both sun synchronous and polar orbits.

Space Hub Sutherland

The Sutherland Spaceport through a public private partnership between the Highlands and Island Enterprise (HIE) and UK private company Orbex. Orbex also plans to have its Head Quarters and manufacturing section in Forres, an approximate three hour commute from the space port on navigable roads. The HIE expects job creation to reach 250. Sutherland has been pledged of £17.3 Million by the HIE, including £2.5m from the UK Space Agency. The spaceport at Sutherland is predicted to boost the regional economy by £56m per year by the end of this decade. Orbex and HIE state that Sutherland will be the greenest spaceport globally.

Benefits:

Supported over other options by HIE, Scottish Government and UK Space Agency

Geographically well placed to reach both sun synchronous and polar orbits.

Plans for environmental sustainability and economic development

Orbex is a British copany.

Provides an opportunity to keep skilled individuals in the Highlands and to avoid depopulation.7

Machrihanish

In 2012, Machrihanish Airbase Community Company (MACC) bought the airbase with support from the Highland and Island Enterprise (HIE). Discover Space is a subsidiary and independent company of MACC and runs all the space port related activities and passes all profits back to MACC. Discover Space’s aim is to promote UK research and development and to enrich the home grown talent in the UK it. This is a vital niche.

Benefits

A former WW2 airfield which hosted the US Navy during the cold war, Machrihanish has a long runway which accommodated the Vulcan bomber. This creates obvious advantages for a space port, especially for horizontal launch possibilities.

Potential for use as a space research hub for skills development and innovation.

Run as a not for profit to develop the local space industry.

Prestwick Spaceport

A space port at Glasgow Prestwick Airport would have an advantageous position for horizontal launch, as its altitude combined with over sea take off and meteorological conditions provide the ideal conditions. Moreover, Prestwick is located close to many of the UK aerospace companies.14 Prestwick has a long history in the aviation industry, it provides air traffic control handover and has full airport facilities. In addition to the spaceport at Prestwick which has achieved £18m from the UK Government and £5m from the Scottish Government, its Space Innovation Centre is funded £6m from South Ayrshire council, £4m from the UK Government and £1m from the Scottish Government. Prestwick received £80m from the Ayrshire Growth Deal, it will begin to make the necessary changes and should start launching by the 2030’s.

Benefits:

Infrastructure is in place for Prestwick: it is close to Glasgow and has easy motorway access

Investment has already been directed to Prestwick.

Historical military and civil usage

Spaceport I in the Outer Hebrides

Proposes sub-orbital vertical space launch for test and research. This would be owned by a consortium of public and commercial actors. This project has attracted a lot of criticism and back lash from local environmental and wildlife groups.

What can the UK and Scottish Governments do to support the establishment of Scottish spaceports and help them to succeed?

The UK is setting out its stall as a potential front runner in the small launch industry. The UK government and the Scottish government have already provided funding to commercial entities to encourage investment and further growth. It is essential that this continues if we wish to see a thriving space industry.

The public sector cannot do this alone – the UK government and the Scottish government should look to successful spacefaring states as a model for growth. We suggest looking at Luxembourg’s model – although legislation has focussed on provision for mineral extraction in space, their ability to corner a market and offer a niche product through concise legislation could be emulated.

However, it is important to define what would happen if Scotland achieved independence. I believe that these spaceports would become hotly contested issues which will require some forethought.

One key way in which the UK can ensure the success of all its Spaceports is by promoting signage between all of them. This can be done through careful regulation and ensuring that each Spaceport has its own objectives that are working to achieve a common goal. It is imperative that the UK as a small space state seeks to carve out its niche and use all available resources effectively. Therefore, if the Spaceports find themselves pitting against the larger power who not only out spend but have also been doing it for longer the UK will struggle to utilise space to its maximum efficiency. The UK cannot afford a misstep. 

One key policy suggestion is that each Spaceport is given a key role which pushes toward a unified goal which will improve the lives of the citizens of the UK and the world. Thus far, the UKSA strategy is vague and it risks being paralyzed and left behind. It is imperative that we have clear expectations so that our spaceports are not doomed to chase the same rabbit down the same rabbit hole, because that will be a waste of taxpayers money and this amazing opportunity. Having all 5 work on Different yet equally valued projects that all push toward the same goal will Increase the UK's scientific output and better assist us in finding our niche. 

Challenges? 

Size:

The UK space sector is currently small. It is therefore essential that it is focussed. The biggest challenge currently facing the UK / Scottish space sector is the variety of industries in which it is aiming to thrive.

The UK’s current Space Strategy is non specific. It promises much with little detail on how this will be achieved. As it notes “we have ambitious plans”, but it does not have the finances to back up very ambitious plans. The UK government is moving in the right direction – the UK Space Regulator in the Civil Aviation Authority provides a clear hub for national space legislation. However, it needs to move more quickly, if the UK wants to achieve first mover benefits, we need to ensure that legislation is clear and that authorisations are processed quickly.

Focus:

The UK and especially Scotland, cannot take on more established space powers in those areas already developed. Large scale research launches, large payloads, and planetary exploration are clearly off the cards, however, Scotland may need to de-diversify and specialise in one area.

Luxembourg, through national legislation, has set itself up as a hub for those companies aiming to carry out potential extraction of resources from celestial bodies.

If Scotland acts fast, and in a consistent and collaborative manner, it is well placed to benefit from the new space economy.

Infrastructure:

All Scottish spaceports bar Prestwick are in the Highlands and Islands. Therefore it is important to consider  infrastructure. The Highlands and Islands have minimal infrastructure, and although there are some excellent roads and rail capabilities for holding heavy goods vehicles, much of this infrastructure is focused towards population centres: Inverness, Oban, Fort William. To maximise the utility of each or any spaceport, it will be essential that increased infrastructure needs are investigated in advance.

Spaceport 1, in the Outer Hebrides, is the only UK spaceport that might be able to achieve solar synchronous orbit. Currently, however, it is difficult and costly to transport resources to this part of the UK. Environmental and community opposition to Spaceport 1 includes opposition to increased infrastructure, and increased traffic.

Orbex, who run the Spaceport at Sutherland, has chosen to place its HQ and Manufacturing base in Forres, a 3 hour drive away. Orbex aims to run the world’s greenest spaceport this way, and have encountered less opposition.

The UK either needs to improve infrastructure to Highlands and Islands or invest in assembly processes and manufacturing closer to each spaceport. The former of these two options will perhaps prove to be the most costly but will insure the highlands and Island are fully integrated into the British economy and place the Space sector as a priority within that economy. The latter will be cheaper in the short run and allow for satellites to be built elsewhere in the UK and assembled at the Spaceport before launch. The hope is that the UK can keep investing in research to make satellites lighter which will in turn mean that less is needed for launch and therefore less needs to be transported to these Highland and Island Spaceports.

Commercial entities:

Scotland, and the UK more widely, needs investment from the commercial space sector, but must balance this against losing control over its space industry. As a small space actor, the revenue gained from commercial interests could be huge, but both Westminster and devolved government must pay careful attention the legal details pertaining to public private relationships.

Even where development occurs on a fully commercial basis, UK Space and the Scottish government remains fully responsible under the UN outer space treaties.  The Outer Space Treaty 1967 requires non-state actors to have authorisation and continual state supervision. It notes that responsibility for compliance is ‘borne by the state party’ and most importantly, the state party from whose territory it is launched, is liable for any damage caused by space exploration. The Rescue and Return Treaty of 1967 declares that States must help astronauts who are lost or in distress, and states must pay for the return of anything that was launched from their soil. The Liability Convention of 1971, importantly, notes that the launching state is liable for any damage caused by launch or space craft.

These legal considerations must be at the heart of any public private relationships that Scotland hopes to develop for its space sector. Any slips on this could be very costly.

Conclusions

Scotland is pushing to become the space capital of Europe. Given its geographical position, its historical prowess in manufacturing, and its early steps into the industry, this is not unachievable. However, it is important at this point that government agencies, commercial entities and other space sector stakeholders ensure that this push goes in the right direction.

Post Brexit the UK cannot bid for certain ESA contracts on Galileo and Copernicus. It can no longer use Galileo for defence or military purposes, cannot access the Galileo PRS, will not be involved in the future of Galileo or EGNOS, and cannot bid for any future EU GNSS or Galileo Contracts. The running of Galileo has been shifted from ESA to the EU’s Agency for the Space Programme, previously the GSA, now titled EUSPA.

Although the UK is still a member of the European Space Agency, which is not a part of the European Union, it has nonetheless lost access to aspects of hardware and data.

The UK now needs to find its place in space, and given budgetary restrictions needs to establish its own niche area of the space sector.

To do this, the government needs to make an early decision regarding the role of the state and the role of commercial entities. It is essential that from the outset, the Scottish Government and Westminster are each clear on their roles. It is this that will guide the provision of funds, the creation of new regulation and the future of the space sector in Scotland, and more widely in the UK.

September 2023