The background
Humans have not traveled beyond the orbit of the earth since the Apollo program ended in 1972. NASA has been officially trying to change that since 2004, when President George W. Bush announced what had become the agency’s back-to-the-moon constellation program.
In 2010, the Obama administration canceled Constellation, but two key pieces of the program survived: the Orion crew capsule and a rocket that became what is now the Space Launch System, or SLS. Both vehicles are developed with classic “plus-plus” contracting, where NASA pays the full cost of development, even if the cost rises much higher than the initial estimates.
NASA’s Artemis program will use the SLS to explode astronauts to moon aboard Orion, where they meet a previously landed lunar lander to travel to the surface and back. Orion will also light up at the Gateway in the future, a small space station in a lunar orbit. From there, astronauts can conduct science and transfer to lunar landers.
Instead of building a lunar lander itself as with SLS and Orion, NASA has chosen to pay space companies a fixed price to build their own lunar landers, which the companies will own. NASA, in turn, can purchase continuous landing services from these providers. The total cost to NASA has therefore been determined – any cost overruns are covered by the companies.
Conversely, if companies can deliver their landers for less than the cost of the contract, the company retains the difference as profit. NASA has successfully used this model to transport crew and cargo to the ISS.
Encouraged by a business-friendly White House insisting on a lunar landing in 2024, NASA expanded its use of public-private partnerships to a low-Earth orbit, creating new programs for commercial deliveries of lunar payloads with missions for scientific instrumentation and demonstration of technology. Last year, the agency funded SpaceX, Blue Origin and Dynetics to develop man-made lunar lander concepts for Artemis, and proposed spending nearly $ 21 billion over the next five years to support various human landing vehicles.
But despite strong support in the White House, Congress provided only $ 850 million to lunar landers last year – well below the $ 3.4 billion requested by NASA. Faced with a shortage of funding, NASA is delaying its decision to choose which companies will receive funding for the continued development of their lunar landers.
That is, until last week when NASA announced that they were going to have an all-in on Starship.
NASA would probably want to select more than one supplier for redundancy. But with few funds to go on and the prospect of dragging out the lunar landings for many years to come, they chose the cheapest and probably the most successful option: SpaceX.