On the economy of Space Colonies

This post was originally pubished on blogspot.com on January 19, 2012

In this article, I’ll restrict myself to space colonies in Near Earth space.

Since space colonization cost a huge amount of money, it is necessary that the first space colonies are making profits. For the purpose of this article I’ll assume that space colonies will be financed primarily be issuing corporate bonds at international stock markets.

In order to repay the debts, it is necessary to investigate how space colonies can make money. In the past there had been several ideas presented for this: mining of extra-terrestrial bodies, building solar power satellites and producing material which can’t be made on Earth.

According to John S. Lewis, only resources with a high unit value are worth to be exported from NEOs back to Earth. In practice we are limited to exporting of precious metals like gold and platinum group elements. Which have a value of thousands of dollar per kilogram. Of course this is not a big issue, since any profit is as welcome as possible.

But NEOs also contain other less valuable resources, which can be made profitable in some way. O’Neill has proposed to use lunar resources to build solar power satellites, which send energetic microwave beams to Earth. For several reasons, it would be actually a better idea to use resources from Near Earth asteroids.

The big issue with space based solar power plants, which we have to take into account, is the public reception of beaming energy from the skies back to Earth by using microwaves. Even if this procedure should be entirely save [according to some researches microwave transmission of power should be safe], it is very unlikely that the big public will believe space based solar power is safe. We see here on Earth that people are afraid of living near to high voltage cables, due to perceived health risks.

Therefore we couldn’t rely on space based solar power to repay the debts, however, since space colonies still need solar power satellites for themselves, we should be able to lease SPSs to terrestrial costumers, if they wish so.

For some strange reason I have never seen a very obvious option in space colonization literature. This option is making satellites from space resources. There nowadays there are thousands of satellites in orbit around Earth. All are made on Earth and then launched into orbit. Since the launch costs are the largest part of the cost of satellites, eliminating the launch costs will give space based industries a large competitive advantage.

Space colonies could lease (custom-made) satellites to Terrestrial costumers, which should provide a continuous flow of income. And after termination of the lease contract, the satellites could be recycled. As an extension of this recycling policy, is the option to collect already existing space debris for extracting and reusing resources. Of course this will be done free of charge, since the debris resources should in combination of eliminating the dangers of the debris be valuable.

Space manufacturing is the manufacturing of commodities in space. We have already discussed some applications of this above. But space based industries, can also produce new commodities for export. The lesser gravity in outer space make it possible to produce goods which cannot made on Earth, like alloys of metals which don’t mix on Earth, but does in space. And crystals are growing better and bigger without gravity.

If these commodities are demanded in quantities high enough, it will be profitable to export them to Earth.

There are many ways to make space colonization profitable. The best solution will be a combination of the mentioned ways. However, we think the best we should start with establish an asteroid mining industry, before all others. Because asteroid mining is base off all space based economic life. In the course of time other industries will be developed as well and after some time all investments can be paid back.