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Our future in space is bright, if you ignore the growing cloud of debris overhead

Curious investors should check out these five companies trying to declutter the path forward

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While space technologies may eventually enable migration to other planets, which some scientists like physicist Stephen Hawking and some business leaders like Elon Musk have viewed as necessary for the long-term survival of the human race, there are other potential benefits to space exploration.

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In 2022, the plunging costs of launches and payloads are opening up big commercial opportunities, as highlighted by SpaceX’s constellation of satellites poised to deliver broadband Internet service to the world’s population – nearly half of whom still do not have any, or reliable, access.

But there could be a problem with the increasing number of new objects in orbit and the cloud of space debris circling Earth at speeds of up to 28,000 kilometers per hour.

The cloud is made up of tens of thousands of decommissioned satellites, spent rocket stages and other paraphernalia at least the size of softballs, plus millions of smaller pieces such as metal chips. It is the biggest threat to the space industry, telecom magnate Charles Sirois believes.

The risk of collisions is growing exponentially as the mix of detritus and active equipment grows in leaps and bounds due to countries and corporations ramping up launches. Just the current initiatives for launching satellites will add an estimated 100,000 objects in orbit by 2029.

As congestion intensifies, so does the potential for the Kessler Syndrome, whereby ongoing collisions shatter into more numerous pieces, triggering an ever-widening chain reaction of collisions. It could become too deadly to launch any object, threatening space commercialization and interplanetary travel.

Reports of near misses are becoming more frequent. In December, SpaceX satellites forced the Chinese space station off course. The month before, the International Space Station had to dodge fragments from a Chinese satellite destroyed years ago by a Chinese missile in an anti-satellite test.

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Warnings surfaced at the Space Technology Summit held Dec. 9 by Respada, a platform for family offices. “What space lacks is a centralized traffic control system,” said Thomas Clayson, chief technology officer at Magdrive Ltd. “At the moment, two spacecraft on a collision course is kind of a game of chicken to see who will move first – that’s madness!”

In short, there is a serious need to devote resources to solving the problem of space debris and congestion.

This could be a socially responsible investment as important to the survival of the human race as decarbonization and other sustainability movements.

It could also be a lucrative investment, given the immense value of removing a serious constraint on the growth of the space industry. No public companies appear to have space junk and congestion as their main focus but there are private companies that have sprung up in recent years – and their financing needs could appeal to private-equity investors such as family offices.

Governments and large companies may have teams working on solutions, but they are not pure plays or incentivized like the following standalone commercial endeavours:

Founded in 2013, Japan-based Astroscale Holdings Inc. is one of the first companies to exclusively address the problem of space debris and congestion. With the help of several infusions of venture capital totaling US$300 million, it has emerged as a market leader in providing: docking and removal services for orbiting artifacts; preparing pre-launch satellites for end-of-life de-orbiting; and offering repair, refueling and other life-extension services to in-use satellites. Astroscale has partnered with Japan’s Aerospace Exploration Agency and is planning a mission in 2022 to investigate the removal of the upper stage of defunct rockets.

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Swiss-based ClearSpace SA is a newer start-up in the same market segment as Astroscale. It beat out a dozen other rivals in a 2019 competitive bid process for a €100 million (about $143 million) contract from the European Space Agency. Their method of disposal aims to de-orbit debris by towing it toward the Earth until gravity pulls it down to burn up in the atmosphere.

NorthStar Earth & Space Inc. is a Montreal-based private company on its way to becoming a traffic cop for objects orbiting Earth. It’s network of 12 satellites outfitted with telescopes are designed to do a more thorough job of monitoring and predicting the trajectory of space objects than ground-based monitoring systems. The company attracted $45 million in December from Luxembourg Future Fund and the Sirois family’s Telesystem Space; it received $83 million in 2018 from a group of investors that included the Rogers family’s trust.

British firm, Magdrive Ltd., is developing plasma thrusters that could make interplanetary travel possible, but for now, it is targeted at providing satellites with high-thrust engines at a tenth of the cost of chemical propellants. This enhances their ability to avoid collisions in space and to de-orbit. In the past year, Magdrive has raised €3 million (about $4.3 million) in seed money from several venture capital firms, including the Founders Fund (an early investor in SpaceX).

Orbit Fab, Inc.’s mission is to build “gas stations in space” that refuel satellites and extend their lifespans so they don’t become inactive and require another satellite to be sent into space as a replacement. Since starting up in 2018, Orbit Fab has raised over US$16 million from the government sector and venture capital firms, such as SpaceFund Venture Capital.

Larry MacDonald is a retired economist who blogs at Investing Journey.

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