POLISH SPACE SECTOR
Since Poland became the member of the European Space Agency in 2012, Polish space sector has been rapidly grooving.
Despite continuous development, Polish space companies focus mainly on niches. They manufacture high quality products mainly for the European Space Agency, as well as national agencies. An example of success in such a niche is Astronika, which regularly wins international tenders to provide specialised instruments for space agencies and private companies. One of its greatest achievements is the supply of parts for the penetrator mounted on the Mars Insight probe.
Until now, Polish companies have mainly been sub-suppliers of instruments, which were later assembled into a finished product by an integrator. Therefore, the main challenge facing entities of the Polish space sector is to advance in the supply chain and achieve higher margins.
The NewSpace revolution
To better understand the potential that lies in the space industry, it is necessary to look at the revolutionary changes that have taken place thanks to the development of launch technologies and miniaturisation which are due to the so-called New Space.
More and more projects in Poland under New Space are gaining momentum. This requires a change of mind, the development of new technologies and business models. However, this opens the way for new, small businesses and start-ups, and makes access to space ever easier and even cheaper.
The coming years will be marked by inevitable digitization, in which space technologies and satellite systems will be increasingly used. The Polish Space Agency (POLSA) is increasingly involved in development and closely cooperates with similar centers in Europe and around the world.
The development of New Space concerns the exploration and commercialization of space, in which not only the largest companies and space agencies participate today. One of the trends is the miniaturization of satellites. In the past, satellites were large, heavy, costing even several hundred million dollars and their construction took several years. Currently, thanks to the miniaturization of subsystems, it is cheaper to carry out, but also the satellite operates for a shorter time in orbit.
NewSpace is radically different from the methods of space exploration we know from the 20th century. The main difference is the emphasis not on research or political goals, but on profits. The direction is not set by politics and large bureaucratic agencies, but by the market. Newspace companies are looking for commercial solutions to real problems. Small amount or no public money supply forces them to adapt to a market that is highly competitive and capital intensive. These factors mean that one of the strongest trends in the industry is the increasing miniaturisation of instruments. An excellent example of successful is the Polish-Finnish company Iceye. The company’s goal was to miniaturise a Synthetic Aperture Radar (SAR). Radio imaging technology allows imaging of the earth regardless of weather and lighting conditions. The instrument, which previously weighed a tonne and was the size of a bus, has been able to be enclosed in a 100kg box. The commercial success of the new technology has allowed the company to rapidly grow its business, which now has 14 satellites.
The changes which have taken place in the launch technology mainly due to the use of reusable rockets, have led to a drastic reduction in the cost of launching an object into orbit from about 54 500 USD/kg in the case of the Space Shuttle to about 5000 USD/kg in the case of SpaceX’s Falcon 9 rocket. This has significantly lowered the financial threshold for entry.
Trends and tendencies
The aftermath of the revolution in launch systems and miniaturisation is the massive constellation of satellites. From large, expensive and non-redundant objects to constellations of small, relatively inexpensive and easily replaceable satellites in case of failure. The clearest example is SpaceX’s Starlink constellation, which will eventually consist of 12 000 objects and provide satellite internet to the entire globe. In Poland, there are also plans to develop at least several constellations. The closest to the goal is SatRevolution, which already this year launched the first two satellites of its Stork constellation also Creotech in partnership with Scanway, is planning to launch its own constellation of observation satellites. The aforementioned Iceye company already has more than a dozen SAR satellites in orbit.
A trend that is also well visible is the use of machine learning systems in satellite applications. An example from our backyard is the company KP Labs, whose activities focus on the development of artificial intelligence systems for processing images. Thanks to the use of artificial intelligence directly on the orbit, the amount of data transferred to the ground is reduced and thus the time needed to deliver the finished product to the customer is drastically shortened.
Satellite applications themselves are also being used to an increasing extent. Modern agriculture, transport or environmental protection need data collected directly from space.
Investor interest
Investor interest in space companies is relatively high, as exemplified by the recent successful debut of the Polish company Creotech on the Warsaw Stock Exchange. After the debut in August the value of listed securities increased by over 100% and since then has remained at a similar level. Creotech is so far only one space company listed on the Polish stock exchange, however in the queue there is already mentioned SatRevolution which plans to enter the regulated market in 2022 using Special Purpose Acquisition Company (SPAC).
A big problem that Polish companies face is the low level of interest of Venture Capital funds in investments. The space industry, despite the fact that it can potentially bring high margins is very capital intensive and the expected profits are uncertain and distant in time.
Risks
Apart from the opportunities, the Polish space sector faces a number of challenges. One of the most important is the lack of legal regulations concerning space activities. The only document that has been published in Poland is the 2017 Polish Space Strategy. However, it is not a binding law, but only a document setting the direction of the sector’s development in the perspective until 2030. Currently, the Polish Space Programme, which is to be a multi-year programme providing funding for activities aimed at achieving the priorities contained in the Strategy is being processed in the Ministry of Development. In the middle of 2022, it is also planned to pass a law regulating space activity, which will contain the principles of regulations concerning space entities: the conditions of their activity, the principles of registration and liability for damage. Together with the new law a national register of space objects is also to be introduced, which Poland undertook to create by signing the Convention on the Registration of Space Launched Objects in 1975.
Summary
The Polish space sector is a dynamically developing area of the economy. Poland’s accession to the European Space Agency has given space companies the necessary funding and know-how to develop their activities. The NewSpace revolution, based on commercialization and miniaturization gives smaller entities the opportunity to use their knowledge and skills to compete on an equal footing with large corporations. There is no doubt that this sector will experience a golden era over the next few years.
Sources:
https://www.esa.int/Space_in_Member_States/Poland
