Right now, a privately built spacecraft named Odysseus has just completed its mission to collect scientific data from the moon’s south pole.

The lunar lander was created by Texas-based Intuitive Machines, the first private company to land a spacecraft on the moon. The firm is one of five partnering with NASA to help kickstart the lunar economy, beginning with commercial delivery services.

The So What

“Returning to the moon is no longer just about exploration and scientific discovery. It is also about economic growth and the application of science for the wellbeing of our planet and its people,” says Troy Thomas, who leads BCG’s global space sector business.

Private firms are undertaking the exploration and development of the moon for several reasons.

• It is a gateway to further space exploration, with the potential to support logistics for deep space exploration.
• It is a likely source of resources needed on Earth, for example rare minerals such as Helium-3.
• It could become a center for R&D in areas that will benefit humanity including agriculture and the development of drugs.

Capitalizing on these opportunities requires investments from both the public and private sectors, says Greg Smith, a principal at BCG.

“If you rely too heavily on commercial firms, there may be too much pressure to deliver returns within an unrealistic timeframe. And if you only rely on public bodies, you may be vulnerable to inconsistent funding cycles, or a slower pace of technological innovation.”

Despite first sending spacecraft to the moon more than 60 years ago, moon exploration remains challenging, and several missions to the moon so far this year have ended in difficulties:

• Astrobotic’s commercial lunar payload mission ended in flames over the Pacific Ocean.
• And Japan’s moon lander lost power after landing in a position that hindered the generation of solar power.

This shouldn’t be a deterrent, according to Smith.

“We need to change the way we think about risk. Trying and failing is the only way to learn. So we need to bake ‘failed’ attempts into the business model and assume it could take five times before a successful mission.”

Now What

The first step is to build the business case for further investment that showcases the long-term opportunities and the advantages of being part of the first wave of activity. Returns on investments aren’t likely to come quickly and are dependent on how operations and technologies develop. The investment community will need a realistic approach to these timeframes and be willing to wait for continued technological developments.

To build a base where people can successfully operate on or near the moon requires a first wave of activity to create the necessary infrastructure. This includes:

• Transporting people and equipment to and from the moon.
• Finding sources of energy, and then storing and distributing that energy.
• Building transport systems on the moon itself, such as rail networks or robotics to transport extracted goods.
• Developing autonomous communication systems to ensure connectivity between different parties operating on the moon.
• Supplying the basic components of human life, including oxygen, food, living quarters, and medicine.

Other elements to kickstart a successful lunar economy include:

Establishing governance systems. Governments and companies will benefit from a set of principles and regulations to establish behavioral norms on the moon. These should aim to eliminate possible conflict while also being flexible enough to promote economic activity. Areas for agreement could include ownership of territories or resources, how people travel and trade, and how to ensure operations are sustainable. Deploying advanced space traffic management technologies could also help manage potential collisions and control space debris as the industry continues to grow.

Generating public support and understanding. The development of the lunar economy will need the buy-in of governments and the general public, especially during more challenging economic times. This can come through effective communication campaigns that demonstrate tangible benefits by showcasing the biotech research undertaken at the International Space Station. R&D based on the moon’s unique atmosphere could help stem cell development for regenerative medicine, immune response for cancer therapies, and easier protein crystallization for drug development, for example.

For further information, please connect with Greg Smith and Troy Thomas at the Space Symposium in Colorado Springs, April 8-11.