Legal and Economics Implications of Orbital Debris Removal:

Comments of the Space Frontier Foundation

In Response to: DARPA Orbital Debris Removal (ODR) Request for Information

for Tactical Technology Office (TTO), Defense Advanced Research Projects Agency (DARPA)

Solicitation Number: DARPA-SN-09-68

October 30, 2009

Co-authors:

James E. Dunstan Bob Werb 6105 Tobey Ct. 16 First Ave. Springfield, VA 22150 Nyack, NY 10960 703-851-2843 845-358-5790 jdunstan@gsblaw.com bobwerb@spacefrontier.org

Executive Summary1

The Space Frontier Foundation (“Foundation”) is dedicated to opening the Space Frontier to human settlement as rapidly as possible. Our goals include protecting the Earth's fragile biosphere and creating a freer and more prosperous life for each generation by using the unlimited energy and material resources of space. Our purpose is to unleash the power of free enterprise and lead a united humanity permanently into the Solar System.

Although the present RFI focuses on technological approaches to Orbital Debris Removal

(ODR), it recognizes that any successful approach must consider economic viability (focus area 5, “An estimate of an economic metric (e.g. $/kg removed or $/particle removed”). These comments will focus on the legal and economic aspects of ODR. Indeed, the best technology available for choosing among various approaches to ODR is a free competitive marketplace. Any “program” of ODR should focus on establishing the proper legal and economic regime such that private industry can provide this vital “trash removal” service. The goal of Government’s ODR should be to establish, at the earliest possible date, an environment where private industry is incentivized to economically remove space debris.

An ODR program needs to take into account the complex realities of the orbital debris

problem. Some objects pose a much greater danger than others and some orbits are much more “polluted” than others.

Current interpretations of international law have led both public and private space

operators to ignore the orbital debris problem and act as a serious barrier to any program of ODR. Maritime and admiralty law seem to offer a path out of the conundrum. In addition, without adopting one of several possible mechanisms for liability mitigation, it is improbable that anyone will be willing to engage in an ODR program. Indeed, the legal and diplomatic issues may well prove to be the “long pole” in the ODR “tent” that must be solved before a set of technical solutions can be developed.

A number of different economic techniques exist that could be applied to both sides of

the orbital debris equation. On one side a means of making it costly to those generating debris must be chosen. Possibilities include: requiring payments into a fund, requiring the purchase of insurance with the fund as beneficiary and/or having government fund the costs. On the other side of the equation, a means of incentivizing ODR operators must be chosen. Possibilities include: payments based on published criteria, setting a removal price for each object or set of objects and/or performance-based contracts. Another alternative to consider would be similar to current carbon trading proposals. Significant work involving expertise in the law, economics, diplomacy and politics is required to choose among the workable legal and economic techniques that are available to government. 1 About the Authors: Bob Werb is Chairman of the Board and co-founder the Space Frontier Foundation and has long been an active advocate for unleashing the power of free enterprise to open the space frontier to human settlement. James E. Dunstan is an acknowledged expert in Space Law, having been in practice for over 25 years representing aerospace companies before federal regulatory agencies. Jim drafted and negotiated the lease of the Mir space station in 1999 on behalf of his client MirCorp, the only time control of a manned space asset has changed hands.

Technical Response

Characterizing The Orbital Debris Problem

The RFI acknowledges that the orbital debris problem is actually several problems. Different orbital altitudes and inclinations present different problems and provide different opportunities for ODR. What the RFI does not do, however, is recognize that the sources of the debris differ significantly between orbits. The source of the debris (i.e. the State of Registry) is critical, because both the responsibility and rights to remove the debris must be established before a technical approach to ODR can be undertaken.

NORAD currently tracks some 17,000 pieces of orbital debris of 10 centimeters or larger. It is estimated that there are some 300,000 objects between 1 and 10 cm. The U.S. government has cataloged 13,000 objects. Only 6 or 7 percent of the 13,000 objects are operational satellites; some 40 percent of the objects catalogued are from breakups, fragmentation or collisions. Another 25 percent are the result of “mission related” debris (e.g. upper stages, fairings, explosive bolts). Over 90 percent of the non-operational objects are uncontrolled and capable of colliding with other derelict objects, or operational satellites if the latter do not take evasive maneuvers. Traditionally, however, countries have operated under a “big skies” mentality – orbital space is so large that the probability that any two object’s orbits would intersect was quite small. This “big skies” approach has been encouraged, in part, by an international legal regime, as discussed below, that makes it easier to “fire and forget,” than to manage assets in a way that encourages the mitigation of orbital debris and removal of space objects at end of life (“EOL”). The orbits occupied by this space junk are surprisingly concentrated. While the highest value “targets” (other than the International Space Station) reside in the geostationary (Clarke) orbit, that orbit is relatively “clean,” mainly because the communications satellite industry has an economic incentive to remove satellites at the EOL and place them into “safe” orbits 200-300 kilometers above the Clarke arc. These industry practices have been codified by the United States in 47 C.F.R. § 25.114(d)(14) (adopted in 2004, amended in 2006). Instead, the most “polluted” orbits are polar or near sun-synchronous orbits. These orbits are both vital to remote sensing because of the ability to view the totality of the Earth’s surface, but also present particular problems because the spacing of the orbits decrease, even converge, over the poles. The Chart below shows the most densely packed polar orbits:

Chart Onei Inclination No. of Objects Total Mass (Tons) Country of Origin 81-83 degree 739 817 >97% Russian (or USSR) 69.9-74.1 deg. 644 480 >95% Russian (or USSR) 96-103 deg. 316 322 US = 155 objects, 85 tons

US Allies = 80 objects, 85 tons Russia = 42 objects, 93 tons China = 39 objects, 59 tons

Two recent events have also highlighted that the largest risk to the health of orbits is the breakup of large objects and especially the collision of two large objects because of the increase

in the orbital debris population that occurs when a large object breaks up. On January 11, 2007, the Chinese government tested an anti-satellite system (ASAT) by “shooting down” a Fengyun weather satellite with a mass of 750 kg, in an 865 km polar orbit. The satellite was not actually “shot down,” however. Instead the kinetic energy weapon destroyed the satellite and created approximately 2,700 new pieces of debris with a size of 3 cm or larger. The second recent event was the collision between the Iridium 33 (a U.S. Commercial satellite with a mass of 560 kg) and Cosmos 2251 (a Russian satellite with a mass of 950 kg), on February 10, 2009, at an altitude of 789 km. NASA experts now believe the collision created another 2,500 trackable objects. These two events demonstrate that the greatest risk of increasing space debris occurs in a “large/large” collision, and because of the size and cross section of larger objects, the probability is higher that these “targets” will be hit, resulting in potential “cascade effect” debris proliferation. Any ODR program therefore should focus first on identifying and removing the large objects that travel in the most congested orbits. The graphic below, developed by NASA’s Nicholas Johnson, shows how the removal of just a few large objects can slow, and begin to reverse, the near exponential increase in space debris that the world now faces.

A second class of objects that should be targeted for removal or safeing are those objects that are currently on a collision trajectory with another object where both objects are incapable of avoiding the collision. Since it is computationally intensive to run “all-against-all” collision scenarios more than a few weeks in advance, at least in the near term, it will be difficult to implement an “operationally responsive” ODR program that can identify and remove these potential collision scenarios. In cases where the “victim” is a high value asset, however, incentives should be created to foster the development of such systems as rapidly as possible. The Underlying Legal and Diplomatic Issues are as Daunting as the Technical Issues It is axiomatic that orbital debris is a global problem. As Chart 1 indicates, the objects that currently present the greatest danger were launched by the Russian (and the former Soviet

Union before), which is responsible, by mass, for more than 70 percent of orbital debris. Yet what responsibility does the Russian government have to remove this debris, especially the debris created by its predecessor entity, the Soviet Union? The answer, unfortunately, is none. Two major international agreements govern the issue. First, the 1972 Liability Conventionii makes the launching state strictly liable for any damage caused on the Earth from a launch or reentry of a manmade object (Article II), but liability for any on-orbit collision is based on a fault analysis (Article III).iii The 1976 Registration Conventioniv requires that all launching states register space objects with the U.N. However, only the United States routinely registers all stages of a launch; most countries merely register the launch vehicle and the payload(s). Most important, there is no penalty for not registering with the U.N. These treaties, as interpreted by the spacefaring nations, have led space operators to ignore the orbital debris issue, because of a perverse interpretation of international law that essentially says that if you just leave a satellite in its orbit at EOL you are not at fault for anything that subsequently happens. Collisions occurring after EOL are “Acts of God,” and not the fault of the launching state or state of registry.v Finally, under the 1967 Outer Space Treaty,vi states of registry retain jurisdiction (and therefore ownership) of space assets once launched.vii Article VIII specifies that a state party to the treaty "on whose registry an object ... is carried shall retain jurisdiction and control over such object... while in outer space or on a celestial body." It further states that "Ownership of objects...is not affected by their presence in outer space or on a celestial body or by their return to the Earth." No concomitant duty exists under any of these documents, however, to remove objects. So, whereas spacefaring nations have taken steps to mitigate orbital debris in varying degrees,viii none have taken any concrete steps toward ODR because there is no international legal requirement to do so and orbital debris is a classic “collective action” problem. Indeed, there is a significant legal issue that must be resolved before an effective ODR program can be implemented. Under current international law, only the state of registry would have the legal right to remove a piece of space debris, if Article VIII is strictly interpreted. Any entity (be it a government or a private company) that to attempts to remove space junk could run into a claim from the registering state that it was in violation of international law. Legal Solutions to ODR

Juxtaposed against this somewhat counterintuitive construction of international space law is thousands of years of maritime and admiralty law governing human activity on the high seas. Outside of the recognized borders of countries, generally the seas are res communis (the seas belong to everyone). It is under this concept that all nations can fish the high seas. There are also long-established principles related to objects that are found in the sea, including shipwrecks. The Law of Finds and the Law of Salvage go back at least 500 years, and allow for the recovery and ownership of abandoned property found on the seas (Law of Finds), or for the recovery and right of possession of ships and cargo in peril (Law of Salvage). In either case, those who recover either type of property gain substantial rights to the value of the assets. Whether orbital debris is subject to the Law of Finds or the Law of Salvage will turn on whether a court determines that the debris has been abandoned. A strong argument can be made that unlike

cargo that has an intrinsic value that is hard to abandon, spent upper stages and derelict satellites have totally served their useful purpose and are left as junk in orbit. The United States should take the position that orbital debris constitutes abandoned property, and is “fair game” for removal or in-orbit recycling.

One simple approach to this is to encourage and support the re-registration of space

debris that is to be removed. As noted above, under the Liability Convention and Registration Convention, the launching and registering states are liable for the objects that they launch and/or operate. Telecommunications satellites have been re-registered by different states over the years, either because of the sale of a satellite,ix or when the satellite operator changes country of incorporation.x A similar approach could be undertaken here, where orbital debris is re-registered as such (either with the concurrence of the original state of registry or through a court claim under the Laws of Salvage/Finds) by the United States.

The second critical legal issue that must be addressed in any ODR approach is that of

liability. Because of the Liability Convention’s strict liability approach for any damage done to persons or objects planetside, ODR operators face significant risk. This risk can be mitigated in several ways, including: 1) Transferring registry of the object from the launching state to the state of incorporation of the ODR company as described above (thus transferring the liability away from state that has failed to remove the debris); 2) Requiring that an ODR company obtain insurance to cover third party damage caused by the debris; and 3) Establishing a mechanism, similar to that under the U.S. Commercial Launch Act of 1984,xi whereby the a government would indemnify the ODR company for a portion of the “maximum probable loss.”

Finally, the United States must decide whether to “go it alone” on ODR, or work through

international channels to craft a global solution. In the long term there are obvious advantages to tackling the problem multi-nationally. If a treaty organization tasked with both collecting and disbursing ODR funds could be created, it would level the playing field for new generators of debris and increase the size and number of competitors in the emerging ODR industry. On the other hand, reaching a multinational consensus is both complex and time consuming. Moreover, a “first entrant” country that could establish a sustainable economic approach to ODR could reap substantial benefits by both crafting a policy for ODR, and, potentially, gaining revenue by becoming registries for expended stages and satellites that still have value, but are abandoned by their operators at the EOL for which they were originally launched.

Economic Solutions to ODR

From an economic perspective, the worst possible technique for ODR would be to use

general tax revenues to fund cost-plus contracts. The use of general tax revenues separates the economic consequences of generating additional debris from the parties in a position to minimize its creation. The use of cost-plus contracts creates perverse incentives, rewarding failure and delay with additional funding. Fortunately, a number of other techniques are available to government with much greater prospects for success.

The needed funding could at least partially be raised from parties who generate debris.

An Orbital Debris Removal and Recycling Fund (ODRRF) could be created and funded in one of

several ways. The debris potential of a particular launch could be evaluated and charged an upfront fee paid into the fund. Alternatively, parties could be required to purchase insurance that would pay into the fund in the event that any debris is actually generated. Government launches could also be required to pay into the ODRRF and it may make sense for government to seed the fund by paying for debris already in space. Whatever funding mechanism is chosen factors directly relevant to the danger posed by the debris should be effectively priced including: mass of all objects that will remain in orbit (vehicle and upper stages,) congestion of the orbit into which the vehicle (and upper stages) will be launched, EOL plan for all components and track record related to EOL operations.

By way of reference, the FCC charges satellite operators between $116,000 and $400,000

in initial licensing fees, and then $130,000-$181,000 per year in regulatory fees (depending on the orbit of the satellite). Thus, over the expected 10 year life of a satellite, the FCC collects between $1.4 million and $2.2 million in fees to regulate satellites.

ODR providers could be compensated in one of several ways. The ODRRF could make

payments for debris removal based on a clear set of published criteria. Alternatively, the ODRRF might prefer the greater flexibility and simplicity of placing a fixed price on each object, or set of objects. Or perhaps, the ODRRF would issue performance-based debris removal contracts to qualified service providers. Whatever the pricing and payment mechanism chosen, it should be based on the danger posed by the object (orbital altitude, orbital inclination, mass, and trajectory analysis of potential impact) and the action taken to “safe” the object (whether the object is deorbited, captured and controlled, placed into a safer orbit, or physically tagged for better accuracy of measuring its risk.)

An alternative or supplement to creating an ODRRF would be to create a mechanism

similar to carbon trading, where anyone who is creating debris is required to mitigate its effects by either removing (or paying someone else to remove) the debris, or some other more threatening debris.

Choosing among these economic techniques and determining how they can be effectively

combined is more urgent than any effort to understand the needed engineering techniques because with the correct incentives in place the private sector will analyze and test the various technical solutions and through competition amongst themselves determine which ones are the most effective, with a marketplace, rather than the government, choosing winners and losers.

Conclusion

The current legal regime creates perverse economic incentives that are greatly

aggravating the problem of orbital debris. The quickest and surest path to resolving the problem is to establish a legal and economic environment that places a high price on anyone generating new debris while simultaneously creates adequate rewards for anyone who mitigates debris. Significant work involving expertise in the law, economics, diplomacy and politics is required to choose among the workable legal and economic techniques that are available to government.

Citations i Chart courtesy of Joe Carroll, presented at Space Access, April 2, 2009. ii Convention on International Liability for Damage Caused by Space Objects, 24 U.S.T. 2389, T.I.A.S. 7762 (1973) (“Liability Convention”) iii Liability Convention, Article IV. iv Convention on the Registration of Objects Launched into Outer Space, 28 U.S.T. 695, T.I.A.S. 8480 (1976) (“Registration Convention”). v Probably the most famous case arising from the Liability Convention was that of Soviet Cosmos-954. With an RTG (radioisotope thermal generator) onboard, the decommissioned satellite deorbited January 24, 1978 over the Northwest Territories of Canada, allegedly spreading radiation over thousands of square miles. Canadian made a claim under the Liability Convention for damages caused on the ground under the strict liability provisions of Article II. The Soviets, however, claimed that damage was caused because of an on-orbit collision which destroyed the satellite, and any damage caused on the ground was the result of the collision, and not the fault of the Soviets. Eventually the two countries entered into an agreement on April 2, 1981, under which the Soviets denied liability but made a settlement payment of C$3,000,000. vi Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space Including the Moon and Other Celestial Bodies, 18 U.S. Treaty 2410, 610 U.N.T.S. 204 (1967) (“Outer Space Treaty”). vii Outer Space Treaty, Article VIII. viii In 2002 ESA issued its “European Space Debris Safety and Mitigation Standards.” In 2006 the U.S. National Space Policy reiterated that “it seeks to minimize the creation of space debris.” Also in 2006, China released a “white paper” in which it supported debris mitigation policies at the international level. The UN’s Committee on the Peaceful Uses of Outer Space (COPUOS) in 2007 adopted its Space Debris Mitigation Guidelines (later adopted by the General Assembly). These 7 Guidelines call for launching states and satellite operators to:

1) Limit debris released during normal operations including deployment;

2) Minimize potential break-ups during operational phases (by utilizing better failure mode analysis);

3) Limit the probability of accidental collision in orbit by pre-launch prediction models, careful choice of orbits, etc.

4) Avoid intentional destruction and other harmful activities

5) Minimize potential for post-mission break-ups resulting from stored energy

6) Limit the long-term presence of spacecraft and launch vehicle orbital stages in LEO (removal)

7) Limit the long-term interference of spacecraft and launch vehicle orbital stages with in GEO (safe orbits).

The U.S. has actually gone beyond these guidelines by requiring that all entities requiring an FCC license (for either operations or C3) provide the FCC with an orbital debris mitigation plan. 47 C.F.R. § 25.114(d)(14) (Adopted in 2004, amended in 2006). These regulations include requirements for safe disposal after EOL. ix For example, when Hong Kong was ceded back to the People’s Republic of China in 1997, China passed domestic legislation to accept international liability for the satellite registered through the United Kingdom on behalf of Hong Kong. See J. Hermida, “Transfer of Satellites in Orbit -- an International Law Approach,” in IISL Proceedings of the 46th Colloquium on the Law of Outer Space (2003), p. 189 et. seq. x The Isle of Man, for example, has attracted a number of established satellite providers to reincorporate there (including SES and INMARSAT), and hopes to establish a space registry to re-register existing space assets under its jurisdiction. xi 49 U.S.C. § 70112. Currently, commercial space launch operators are required to obtain liability insurance for the “maximum probable loss” of third parties up to $500 million, and the federal government provides indemnity up to $1.5 billion beyond the required insurance.