Random Thoughts: Space Debris Cleanup Funding Mechanism

Ever since that Kosmos spacecraft t-boned an Iridium spacecraft a few years back, more and more people have been paying attention to the space debris issue. We’ve been able to live with the nuisance caused by space debris for a long time, but space debris, especially in LEO, is one of those things standing in the way of us having really nice things. You want to do something that involves a lot of cross-sectional area (a 4000 satellite LEO constellation, large depots, LEO colonies like what Al Globus has been promoting, power beaming satellites for powering aircraft or microwave thermal launch vehicles, or LEO commsats with enough power and antenna gain to provide satellite-based roaming for cellphones), and all of the sudden the nuisance starts becoming a real pain in the neck or even deal-killer from a collision probability standpoint.

The problem is that while there is no shortage of good ideas for cleaning up space debris1, what has been lacking is a way of monetizing debris cleanup. Without some way to make a profit, companies won’t generally invest resources, and you generally can’t get external investment either. Now, government created most of this mess with launches for military or civilian space exploration missions, so they should be a big part of the solution, but finding ways to make space debris cleanup profitable is important (and preferably in a way that isn’t 100% tied to traditional government funding as the government is a notoriously undependable customer). But initially, even directly government funded efforts would be a huge improvement over what we have now. The challenge has always been finding ways to convince governments to cough up the money for cleaning up their mess.

Here’s my really crazy not-even-half-baked idea:

There are a lot of US corporations that make profits overseas and don’t repatriate them due to the high US corporate tax rate. In some cases these are profits that legitimately came from servicing overseas customers with overseas service centers and factories, and in some cases it looks more like clever tax avoidance schemes. While the sane thing to do would be to lower our corporate tax rate to be more in line with the rest of the developed world, that’s an idea that’s been talked about for a long time without any action.

What if the government agreed to a mechanism for allowing companies to repatriate foreign profits at a discounted corporate tax rate in exchange for donations to a fund for debris cleanup prizes/bounties for US-launched space junk? Say for every $1 a corporation donates to that debris removal bounty fund, they’re allowed to repatriate $X at a corporate tax rate quite a bit lower than the 35% they’d normally pay (say 15%). You could tweak the value X to make sure that it’s economically better for the companies to repatriate than to stay overseas (effectively varying X you can make it as though the repatriation tax rate is somewhere between 15 and 35%). For instance, if X were $5, that would be the equivalence of a tax rate of 29.2%2, at X=$10, the effective tax rate is 22.7%, and the breakeven value of X where it doesn’t save any money to use this method over repatriating at the existing 35% corporate tax rate is X=3.25.

There are several advantages I see to this approach:

  • This is revenue the federal government wouldn’t have gotten anyway without something like this, so this is actually revenue positive for the US government.
  • The repatriated profits minus tax and donation is more money being invested into the US economy.
  • The donation money provides a mechanism for filling the coffers on a bounty system for deorbiting US launched space debris (something like 1/4 of the junk up there) that I don’t think would be tied to the normal appropriation process, since the donation money goes into the fund before any money enters the tax system.

While on the surface this might appear to be very similar to lowering the corporate tax rate to be more competitive, and then using some of the increased tax revenues to fund a program like this, the key benefit is that the money from this donation isn’t appropriated tax revenue, so that may change dramatically how stable it is compared to say a normally-funded program at NASA or DoD. Because this isn’t collecting a tax and then appropriating money for a program though, they could probably setup this program to run for a longer duration that isn’t tied directly to the annual appropriations process. Maybe initially provide a 10yr duration, with the option for renewal, where the money goes into a bounty/prize fund for demonstrated removal of specifically designated US-launched space debris (and the debris of friendly countries willing to approve their debris for removal).

A couple of potential nuances you could add if desired:

  • You could limit eligibility of using this specific mechanism to profits made by aviation and aerospace companies overseas, and use similar mechanisms for other industries to funnel donations to other prize funds more directly tied to the interests of those industries (like say a fund for safe, low-cost nuclear power funded by repatriated oil profits, a fund for low-cost desalination provided by repatriated foreign agricultural profits, etc).
  • If you’re worried about too many people taking this route, or it encouraging companies to move operations overseas to take advantage of the slightly lower effective tax rate, you could set a first-come-first-served yearly cap on the amount that is eligible for this approach, like say $5-10B or something. Or you could set a yearly cap per company (say $100M or $500M or something).
  • You could have the fund either be directly government run, or run by a non-profit with strict requirements that some minimum percent (say 90%) has to be set aside for prizes themselves.

As I said, totally half-baked, and not at all meant to compete with more traditional appropriations-funded approaches like say COTS-like funding, or gov’t funded tech demos, or even gov’t funded debris removal missions, or more government-free options like someone finding a way to make a profit off of satellite recycling. But I wanted to throw this out as a potentially creative mechanism for getting funding donated for an important cause.

The following two tabs change content below.
Jonathan Goff

Jonathan Goff

President/CEO at Altius Space Machines
Jonathan Goff is a space technologist, inventor, and serial space entrepreneur who created the Selenian Boondocks blog. Jon was a co-founder of Masten Space Systems, and is the founder and CEO of Altius Space Machines, a space robotics startup in Broomfield, CO. His family includes his wife, Tiffany, and five boys: Jarom (deceased), Jonathan, James, Peter, and Andrew. Jon has a BS in Manufacturing Engineering (1999) and an MS in Mechanical Engineering (2007) from Brigham Young University, and served an LDS proselytizing mission in Olongapo, Philippines from 2000-2002.
  1. Full Disclosure: My company Altius has a lot of technological pieces that could be applied to the problem.
  2. If I’m doing the math right, the effective tax rate is TReff=[(TRdiscount*X)+$1]/[$1+X]
This entry was posted in Orbital Debris Remediation/Mitigation, Random Thoughts. Bookmark the permalink.

17 Responses to Random Thoughts: Space Debris Cleanup Funding Mechanism

  1. WE agree with this idea because we are associated with space industries. Unfortunately companies in other industries will hate it and they tend to be the ones moving out of the USA.

  2. Try financing space clear up in a similar way British lighthouses. A special charge called ‘Light dues’ is levied on ships docking in the UK and Irish Republic.
    https://en.wikipedia.org/wiki/Light_dues

    ‘Debris dues’ could be levied on all launches to orbit by a non-profit organisation. Deep space (probe) launches count as orbital launches when a stage or fairing goes into orbit. The dues could go into a fund which pays companies and governmental organisations that clear up debris.

    Invite Russia and China to join, so their space agencies can receive payment. Organisations with space radars, like NORAD, can confirm that the chosen pieces of debris have gone.

    Legal action will be required to make payment of ‘Debris dues’ compulsory.

  3. Jonathan Goff Jonathan Goff says:

    Andrew,

    The problem is getting everyone to agree to a new tax like that. Especially when almost all of the junk up there (>90%) was put there by governments. Why should commercial commsats have to bear the brunt of paying for the littering by the US and USSR during the Cold War?

    ~Jon

  4. The commercial commsat firms will reluctantly agree to pay ‘debris dues’ because they gain two advantages from it.

    1. They are putting up plenty of new junk themselves – including upper stages, inter-stages and fairings – each time they launch. Consequently they will find themselves having to pay when that junk hits other people’s spacecraft.

    2. Their spacecraft are at risk from being destroyed in collisions with debris. Trade between cost of ‘debris dues’ V cost of replacement satellite.

    Any levy will have to be applied to military launches as well, unless the military wants to pay the entire cost.

  5. Jonathan Lee says:

    I like your creative thinking on the funding mechanism but don’t particularly like the cleanup mechanism. Sending these highly refined materials back down into the gravity well after so much effort was made to get them up there seems really wasteful. Instead, how about collecting them in some out-of-the-way location for on-orbit refinement and reuse using a solar furnace, or better yet a plasma furnace that allows each type a material to be naturally separated.

  6. Jonathan Goff Jonathan Goff says:

    Jonathan,
    Any given bounty can be written with any success criteria you want–bounty’s can be written in a way to allow salvaging after the object has been moved out of the busy traffic lanes. That said, I’m not 100% convinced that recycling satellites is going to pay off. It might, but it might also be more hassle than it’s worth. That mass is only worth so much due to high launch costs. Once RLVs start flying their “value” goes way down because launching new mass in a better form becomes that much cheaper.

    But I definitely agree that letting the owner have some flexibility on terms of the bounty makes a lot of sense. For some national security spacecraft, maybe they’ll have terms like: a) pay on deorbit only, b) only US companies with personnel with security clearances are allowed to approach the target, etc. While something that’s old and way obsolete might be open to a wider range of bounty collectors, and might leave open the option to salvage the raw materials.

    ~Jon

  7. Peterh says:

    “Organisations with space radars, like NORAD, can confirm that the chosen pieces of debris have gone.”
    But what if my orbital broom is sweeping up mostly stuff like paint chips too small to be tracked by radar?

  8. Jonathan Goff Jonathan Goff says:

    Peterh,
    I’m of the opinion that getting rid of the biggest debris is probably the highest priority. If you take care of the buses and hubcaps, you stop getting BBs (to paraphrase Joe Carrol). I’m not sure if there are really practical ways to independently verify cleanup of paint-chip sized debris. But if you can think of one, I’d be interested in hearing about it.

    ~Jon

  9. A large number of small items can be bagged, taken to an inspection satellite and weighed. The mass of things can be determined using a shaking process.

  10. N/A says:

    Classicly, like the lighthouse example, communal spaces ultimately need governmental/supragovernmental means for management. A Space Guard, if you will, that effectively deals with “shipping” lanes. This offloads work into traffic control (launch coordination, transit orbit clearance), navigation hazard monitoring (orbital debris radar/lidar sweeps), and navigation hazard removal. Removal can take many forms and can be subcontracted to private entities based on type and difficulty.

    A classic example is draining the Van Allen belts with electrodynamic tethers. They represent a navigation hazard (fry electronics on slow boat transfers, not doing humans any favors) that if fixed/maintained is a communal benefit, primarily for GEO/BEO missions. Getting payloads that transit to pay the drain tax is comparitively straightforward as they have direct benefits. GEO graveyard shifting as a service can be a Space Guard role that gets subcontracted to some resupply armed bot to drag reluctant GEOsats out of favorable positions, with an emphasis on switching over to a space coral style payload+backbone infrastructure for popular GEO slots. Laser brooms to hit paint chips is another sweeping op that can be subcontracted out. The real difficulty is larger debris in difficult to reach orbits (which favor subcontractors with plane change capabilites), probably split into upper stage chases and general bulkly trash, with upper stages and tank debris being the highest priority on a bounty system. Anything less in theory can be slowly edged down with laser broom pushes over time.

  11. Peterh says:

    “A large number of small items can be bagged, taken to an inspection satellite and weighed. The mass of things can be determined using a shaking process.”
    Not an option for the cleaning method I have in mind, which would divert passing debris into less stable orbits without direct contact.

  12. If a powerful laser can divert an object then a weaker laser can probably be used to size the object. An independent group running LIDAR on the lower orbit may be possible.

    The 1 page report from the independent group can be used by the debris clearer to claim payment. Tiny items will have to be priced by size rather than mass.

  13. Even very tiny items leave meteor trails when they burn up.

  14. Chris Stelter says:

    I still don’t see the advantage of this funding mechanism. You’re still taxing something you want more of (corporate incomes), even if you’re doing it in a roundabout way. And, critically, you’re still giving an implicit subsidy to those who create debris (whether government or private).

    You need a Pigouvian tax that taxes the act of debris generation (or launching in such a way that generates debris). This is much more efficient that taxing corporate income (however indirectly). Both government and private entities would have to pay into this, and thus would have to consider the cost of their activity. No one likes paying any taxes, so they’d try to avoid any possibility of debris generation in a provable way. And this is the exact behavior you want anyway.

  15. N/A says:

    Err, but taxing launchers is fine and dandy when it’s easy to tag the debris trail from launch via third party radar/lidar sweeps, when a given piece of large debris is easy to catalogue and associate with an owner. However that only deals with launches going forward, and doesn’t force claims on existing junk. It also doesn’t deal well with collision debris (Cosomos/Iridium incident) which will scatter so badly it ends up being very hard to attribute small debris to particular owners. Not to mention if people are still comfortable about the 25 year LEO rule for eventual deorbit, you’ve got ticking time bombs with any pressurized tanks or hypergols on upper stages that haven’t come down yet but will clear the 25 year bar. There’s also the assumption all debris will be exclusively of human origin/creation, which doesn’t account for micrometeorites accelerating satellite/stage death. Who’s in the wrong if a 25 year rule sat goes kablooey due to a meteor shower?

  16. Dear N/A,
    You are describing a charge not a tax.

    A simple debris due is charging $x
    $x = (sum of all debris handling costs in the coming year) / (number of launches last year)

    The advantage of a simple debris due is that it provides money to get rid of old debris including the tiny bits and side effects of micrometeorites.

    A more complex due can apply the polluter pays principle and charge for the new items, giving a rebate when an item of debris deorbits itself. Large items and small items can have different prices.

    A practical system will be a due covering both old debris and new items. Although complex dues will be harder to negotiate.

  17. Axel says:

    “This is revenue the federal government wouldn’t have gotten anyway without something like this, so this is actually revenue positive for the US government.”

    I’m not familiar with US economics and tax, but I wonder: the suggested effectively reduced tax is also applied to money that would have been repatriated anyway (because it just has to, e.g. for dividends)? So at first gov. revenue goes down. Only if companies decide to repatriate more money, revenue goes up again. But would the net result be positive? Corporations always complain about taxes, but are good at avoiding them; would they really repatriate a lot more money? From a global point of view, paying no US taxes could still be better than paying reduced taxes.

    But one way or the other it sure would generate a lot of donation money; just don’t make the donation fund liable for decreases in gov. revenue, just in case… 😉

Leave a Reply

Your email address will not be published. Required fields are marked *