Space-Based Solar Power (SBSP):

Meeting Humanity’s Energy, National Security,

Environmental and Economic Development Needs

Views on the
NSSO-Sponsored SBSP Study Report

National Press Club

Washington, D.C.

Wednesday, October 10, 2007

For more information, or comments, contact:

Margo Deckard
SBSP Project Manager
Space Frontier Foundation
mardeckard@aol.com
937-367-4080

Space Frontier Foundation Page 1 October 10, 2007

 There are 6 billion human beings inhabiting this world. Six billion humans who
place demands on this Earth. Humans who want the Western standard-of-living and who
justifiably want all the conveniences of modern life. A fundamental challenge in this
century is how to provide for the world's growing energy needs. While meeting this
challenge, it is vital that we also protect the Earth's fragile biosphere. Space-Based Solar
Power, or SBSP, may be part of a combined solution for both energy and the
environment. SBSP has the potential to produce renewable energy in very large amounts,
in an economic and environmentally-friendly manner.

The Space Frontier Foundation commends the National Security Space Office
(NSSO) for requesting the study to examine SBSP and the appropriate roles of
government and private industry in its development. The Space Frontier Foundation
agrees with 100% of the recommendations in the NSSO-led study report.

The Space Frontier Foundation, which has opposed many other federally-funded
space programs as being wasteful and/or ineffective, strongly supports a new national
initiative for the U.S. Government to finance and incentivize the private industry
development of SBSP. We urge the current White House, the existing Presidential
candidates, the U.S. Congress, and U.S. industry to heed the NSSO-led study’s finding
that “space-based solar power presents a strategic opportunity” for America that “merits
significant further attention on the part of both the US Government and the private
sector.”

The NSSO-led study reports that the United States has spent over $20 Billion on
fusion energy research in a steady and sustained manner. In fact, the White House has
requested $418 million for fusion research in FY2008, which is 5 times the total amount
this nation has invested in SBSP over the last 40 years. The Space Frontier Foundation
agrees that “SBSP requires a coordinated national program with high-level leadership
and resourcing commensurate with its promise, but at least on the level of fusion energy
research or International Space Station construction and operations.”

For the last 40 years, the biggest challenge to space-based solar power has not been
technology. The biggest challenge has been figuring out “How can SBSP ever
become economically affordable, compared to alternatives?”

Perhaps the biggest news of the NSSO-led study is that the team uncovered
something new that might forever change the economic equation for space-based solar
power. The report estimates that the Department of Defense (DoD) is paying about $1
per kilowatt-hour for electricity in forward bases in Iraq, when all indirect costs are
included. This is an order of magnitude higher in price than what Americans pay for
electricity in their homes. These higher electricity prices are not caused by gouging, but
by the realities of war and how electricity is generated for the warfighter. Currently, we
pump oil out of the ground in the Middle East or the continental United States, and then
transport the oil to the Gulf coast where it is refined into kerosene. We then pump the
kerosene onto tankers, which must be guarded by the U.S. Navy, and transport it to the
Gulf region. We then pump the kerosene off the tankers into individual trucks, which

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must be heavily guarded by American ground forces. Then, these convoys, which are
primary targets for asymmetric attacks by improvised explosive devices, must run a
dangerous gauntlet through a war zone. Finally, the kerosene is delivered to the forward
bases, where it is converted into electricity.

The NSSO-led study report finds that:

o Petroleum products account for approximately 70% of delivered tonnage to U.S.
forces in Iraq—total daily consumption is approximately 1.6 million gallons.
o Significant numbers of American men and women are killed and injured while
they are defending these supply chains.
o The estimated cost of $1 per kilowatt hour does NOT include the cost in lives of
American men and women.

In other words, if space-based solar power existed today it would be saving the
lives of American men and women in Iraq. It is this fundamental finding that creates the
possibility that the DoD might become an early adopter, and anchor tenant customer, for
SBSP. The possibility that the Department of Defense might be willing to sign up as
anchor tenant to “pay for SBSP services delivered to the warfighter in forward bases in
amounts of 5-50 MW continuous, at a price of $1 or more per kilowatt-hour”, changes
the entire economic equation of SBSP.

For this reason, the business case for Space-Based Solar Power may close in the very
near future with reasonable and appropriate actions by the U.S. Government.

In order to close the business case, and begin the development of SBSP, the
Foundation urges the Administration and the U.S. Congress to enact the following
specific recommendations by the NSSO-led study report.

1. DoD as Anchor Tenant Customer: The key to every business is having dependable
and reliable customer(s). The availability of a dependable anchor tenant customer,
who is willing to pay $1 or more per kilowatt hour for large amounts of power, is a
major step forward.

• The SBSP Study Group recommends that the DoD should immediately conduct a
requirements analysis of underlying long-term DoD demand for secure, reliable,
and mobile energy delivery to the warfighter, what the DoD might be willing to
pay for a SBSP service delivered to the warfighter and under what terms and
conditions, and evaluate the appropriateness and effectiveness of various
approaches to signing up as an anchor tenant customer of a commercially-
delivered service, such as the NextView acquisition approach pioneered by the
National GeoSpatial-imaging Agency.

2. Extend Federal Incentives for Other Carbon-Neutral Energy Technologies to

SBSP: The U.S. Government is providing major incentives to many other energy
technologies, in support of energy independence and clean renewable energy

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 objectives. The Space Frontier Foundation believes it is completely reasonable to ask
for consistency in policy, and quite reasonable since the potential pay-off of SBSP is
so large.

• The SBSP Study Group recommends that consistent with the U.S. Government
incentives provided to other carbon-neutral energy technologies, it is critical for
the U.S. Government to provide similar incentives to encourage private U.S.
industry to co-invest in the development of SBSP systems. Specifically, the
following incentives should be provided to U.S. industry as soon as possible to
encourage private investment in the development and construction of SBSP
systems:

• Carbon/Pollution Credits and Offsets: The Space Frontier Foundation believes

that it should be rather straight-forward for the U.S. Congress to clarify, to the
extent necessary, that existing law and policy on carbon/pollution credits and
offsets also apply to SBSP.

o Legislation at both the federal and state level that specifies — and clarifies
existing law as specifying — that SBSP is eligible for all pollution credits,
carbon credits, and carbon off-sets that are available to other clean and
renewable energy sources such as wind, hydro, ground solar, and nuclear

• Extend Loan Guarantees to SBSP Developers & Operators: The nuclear

power industry has been given loan guarantees by the U.S. federal government.
The Space Frontier Foundation urges the Administration and the U.S. Congress to
extend the same incentives to the SBSP industry.

o A federal loan guarantee program of up to 80% should be created for U.S.

companies engaged in the business of developing, owning and operating
SBSP systems. This program should either be an extension of, or modeled
after, the existing loan guarantee program provided to the nuclear power
industry.

3. Low-Cost and Reliable Access to Space (LCRATS): The Space Frontier

Foundation agrees with the NSSO-led study that the “U.S. needs Low-Cost and
Reliable Access to Space (LCRATS)”, and that “LCRATS will also deliver significant
benefits to U.S. national security and American economic competitiveness,
independent of SBSP.”

We urge the U.S. Congress to adopt the study reports recommendation “The nation ...
must significantly increase its investments in … LCRATS and ubiquitous on-orbit
space operations for national security and economic purposes.”

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 o Recommendation: The SBSP Study Group recommends the enactment of
legislation to create transferable investment tax credits for private industry
investments in reusable Earth-to-orbit space transportation systems and in
commercially-owned and operated space infrastructure for orbit-to-orbit transfer,
on-orbit assembly systems, orbital fuel depots, and orbital repair, maintenance
and upgrade systems.

In the Space Frontier Foundation's credo, we have committed ourselves to protect

"the Earth's fragile biosphere" and to bring about a better life for the human race by
"utilizing the unlimited energy and material resources of space." With these goals in
mind, the Foundation is committed to an SBSP Campaign to reach out to the
environmental community and to ensure that “green principals” are used throughout any
development of SBSP in this nation.

The Space Frontier Foundation agrees with the NSSO-led report finding that
“although SBSP holds great promise to deliver clean and renewable energy to all nations
of the world, the potential environmental impacts of the various systems and mitigation
options to minimize those impacts require greater study.”

Therefore, the Space Frontier Foundation intends to hold the U.S. Government to
the specific recommendation in the report that “the U.S. Government ... must study the
potential environmental impacts of the various approaches early enough to help make
effective choices between the various technical alternatives. These studies should be led
by agencies with the required scientific expertise, credibility, and independence, and
need to include all relevant stakeholders. Environmental studies should be piggybacked
to demonstrations of the technologies to minimize the environmental impact in the
eventual large-scale use of SBSP; therefore, maximizing the environmental benefit of
SBSP.”

We must look out of the box to solve the problems of nonrenewable energy and
the human impact on Earth. Please join us in supporting this promising technology. The
Space Frontier Foundation is an organization of people 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.

For more information on the Foundation’s plans to support SBSP, please contact
“Margo Deckard” at mardeckard@aol.com.

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