New Zealand’s Quest for a Sustainable Space Industry

When Rocket Lab first launched its Ātea-1 rocket in 2009, the company put New Zealand on the map in the space industry.

“When Peter Beck and I started the commercial operations of Rocket Lab in 2007, many people didn’t think New Zealand could play a significant role in the international space economy,” says Mark Rocket, an early investor and co-director of Rocket Lab until 2011. “But after its first launch, Rocket Lab has gone on to build a vibrant company.”

In the beginning, Rocket Lab was charting its course as a pioneer in a country without an established space sector. “You might think building that launch capability from New Zealand would be immensely challenging,” says Morgan Bailey, director of communications at Rocket Lab. “It’s true — there were challenges. But at the same time, it also meant we got to start with a blank slate. It’s not something anyone had done before.”

Rocket Lab’s success has paved the way for the emergence of other space-related startups in New Zealand and the involvement of larger companies — such as Fabrum, whose cryocooler technology was chosen for NASA’s Mars Lander project, and Rakon, whose crystal oscillators are part of NASA’s Mars Perseverance rover — in the space industry.

“We’ve been an inspiration to be able to recognize that you can do things in space in New Zealand,” Bailey says. “It’s opened people’s minds to the possibilities of what can be done here, but we’re still very much in the early days of execution.”

A Fledgling Yet Growing Industry

Space is a small and fledgling industry in the country. According to a Deloitte report commissioned by New Zealand’s Ministry of Business, Innovation and Employment (MBIE), the nation’s space sector was estimated to be worth 1.75 billion New Zealand dollars (NZ$) ($1.1 billion) in 2019 — about a third of Australia’s estimated valuation in the same year and only a fraction of the U.S. space industry’s valuation.

Moreover, the New Zealand Space Agency, which falls under MBIE, was created only in 2016 to respond to and manage the rise in space activity.

“The New Zealand space sector is unique in that it was driven by a commercial need, as opposed to other countries where it was government-led programs or defense projects,” says Emeline Paat-Dahlstrom, a space entrepreneur and co-founder of SpaceBase, a New Zealand consultancy focused on democratizing access to space through community-building, education, and entrepreneurship.

But the industry is growing rapidly. The report found that in 2019, the space sector contributed NZ$1.69 billion to New Zealand’s economy and supported approximately 12,000 jobs. The nation has a number of advantages — clear dark skies, lack of aircraft traffic, and remote geographic location — all of which give it an edge over major players across the globe.

“In terms of geography, it’s a great place to have a launch site because you can go east or south and there’s very little air or ship traffic,” says Eric Dahlstrom, a former NASA engineer and co-founder of SpaceBase. “In the U.S., some of the launches in Florida cause much disruption to air traffic, with airlines waiting hours to land in Miami.”

Adding to these physical and environmental advantages is a culture of innovation coupled with ingenuity. Astrix Astronautics, backed by Peter Beck of Rocket Lab, was inspired by inflating plastic trash bags to create Copia, an unfolding solar array for small satellites. Copia was recently launched into space during one of Rocket Lab’s missions.

Meanwhile, Kea Aerospace, which Mark Rocket founded, is creating an unmanned solar-powered aircraft that will fly in the stratosphere for months at a time to obtain high-resolution aerial images for applications such as environmental monitoring, precision agriculture, and disaster management.

Similarly, Dawn Aerospace, with headquarters in New Zealand and offices in the Netherlands and New York, is building a suborbital reusable spaceplane to demonstrate same-day reusability for launch vehicles. The startup has also developed a green propellant to replace the toxic chemical fuels in conventional propulsion systems.

“We’re finding our feet as an industry, but it’s all based on some good fundamentals,” says Stefan Powell, co-founder and CTO of Dawn Aerospace. “We’ve found that we’re very good at research and development. We can be agile. We have an excellent balance of quality and capability but also pragmatism that perhaps is lacking in other parts of the world where they can get bogged down in process and history.”

The lack of history and the small regulatory environment works in New Zealand’s favor. “The government can be much more nimble here. It’s easy to go to the New Zealand Space Agency and have a conversation with them because it’s only a handful of people. You can know them all and have a good personal relationship with them,” Powell says. “The same goes for the Civil Aviation Authority. That’s one of the main strategic reasons we do our spaceplane project in New Zealand. It requires a lot of creative thinking and innovation in terms of the regulation as well, which would be much harder to do in the United States or in Europe.”

Barriers to Growth

Yet New Zealand’s space sector is not without its challenges, one of which is finding people with the right skills and enough experience. “There’s certainly a struggle to find good talent,” says Powell. “It’s still a young industry, so you won’t find people with decades of experience in space. We’re dependent on getting international talent, or training local people with the international talent we bring in.”

To bridge the talent gap, the New Zealand Space Agency has partnered with NASA to offer internships for New Zealand students to train in the U.S., and is providing scholarships for interns. Companies like Rocket Lab are also hiring interns, while universities are offering more space-related education programs, such as the new master of aerospace engineering degree at University of Auckland’s Te Pnaha Ātea Space Institute.

But building the space talent pool takes time, so Paat-Dahlstrom says a mindset shift is needed. “Most people think you need an aerospace degree or something related to space before you can be part of it. But the space industry is just like any other industry where you not only need traditional engineers and scientists but also software engineers, lawyers, managers who can support the ecosystem in a different way,” she says.

Funding is another challenge. Local investment has grown, but it still can’t compete with overseas markets. Bailey says the country lacks the level of capital required for startups to scale quickly, a view that Powell shares.

“There’s no venture capital in New Zealand for a large aerospace company, or one doing aggressive investments,” Powell says. “The sheer scale of financial support that’s available in Europe and that we get through our office in the Netherlands is frankly much larger.”

MBIE and the New Zealand Space Agency are doing what they can to support the nation’s space startups, offering a Catalyst Fund, R&D tax incentives, and grants from Callaghan Innovation, the government’s innovation agency.

They are also setting up Christchurch, a city in the heart of New Zealand’s South Island, as the aerospace center of the country through the Christchurch Aerospace Sector Plan. The plan outlines the goals and actions needed, including attracting 20 aerospace companies to the city by 2025, developing Christchurch into an aerospace startup hub, establishing dedicated funding streams such as an aerospace-specific venture investment fund, and introducing financial incentives such as an annual prize for Christchurch aerospace companies.

But the New Zealand Space Agency can only do so much with its departmental space budget, which was NZ$3.8 million (around $2.4 million) from 2018 to 2019, with the MBIE spending another NZ$6.02 million (around $3.8 million) for space science research, according to the Deloitte report.

“We need more government support if we are going to maximize New Zealand’s aerospace opportunity,” says Rocket. “I’d love to see a JFK moment occur when the government makes a significant investment in our aerospace future, and hopefully, that’s on the near horizon.”

Toward Sustainable Space

Aside from overcoming the challenges of funding and talent, New Zealand is teaming up with nations whose space sectors are more mature and established to speed up the growth of its own. The country has been open to international partnerships through signing the Artemis Accords; engaging with NASA on projects such as launching high-altitude balloons; collaborating with LeoLabs on building the Kiwi Space Radar to track space debris and objects in Low-Earth Orbit, as well as developing a space regulatory and sustainability platform; and working with the German Aerospace Center (DLR) on space technology.

“International collaborations to advance space exploration are now broadening beyond just the traditional major space actors, and there is real opportunity for New Zealand scientists and space companies to be part of these collaborations,” says Iain Cossar, general manager of Science, Innovation and International at MBIE.

Even space companies like Dawn Aerospace are expanding beyond the country. “Space is very much a global industry, and it’s hard to do from just one corner of the Earth,” Powell says. “Having an international presence and international partners are important.”

The same is true for Rocket Lab. Although founded in New Zealand, it is a U.S. company. “New Zealand is part of our story, but we wouldn’t be where we are today without our U.S. partnerships,” says Bailey. “I’d like to think Rocket Lab is a success because we have that heritage where we join those two nations together.”

New Zealand can also take advantage of its agricultural expertise and proficiency in supporting extreme environments to advance its space industry. “Beyond rocket launches, there are opportunities in advancing areas where New Zealand has existing strengths. This includes developing and applying space-based data in areas such as agri-technology, hazard management, oceanography, and meteorology,” Cossar says.

In terms of extreme environments, the country has been supporting logistics and operations in Antarctica for decades. “New Zealand is a major gateway to the Antarctic, and we have researchers from all around the world passing through on the way to that extreme environment. I’d like to see New Zealand use that same approach to be recognized as a strategic gateway to space,” says Rocket.

The most promising area of growth New Zealand can own is what Paat-Dahlstrom calls “green space” or sustainable space. “New Zealand has always been focused on sustainability and the environment,” she says. “Because of this, the nation can take green space or sustainable space and claim it as a brand.”

Some New Zealand space companies are heading in that direction, including Dawn Aerospace with its green propellant and reusable spaceplane, Kea Aerospace with its solar-powered aircraft, Rocket Lab with its plan to make reusable rockets, and Zenno Astronautics, which is developing a fuel-free satellite control and propulsion system that will use magnets powered by solar panels.

“They’re all different parts of the industry and have their own niche in the market, but they can own the brand of sustainable space,” says Paat-Dahlstrom.

Meanwhile, the government is already taking steps toward sustainable space with Project Tāwhaki, a proposed joint venture between the government and Te Taumutu Rūnanga and Wairewa Rūnanga, the iwi (tribes) who are rangatira (owners) of and have mana whenua (territorial rights or authority over land) over Kaitōrete Spit south of Christchurch. The project’s goals involve ecological restoration of Kaitōrete Spit and the development of aerospace activities and R&D facilities in the area.

“The government is committed to developing New Zealand as a hub for high-value, knowledge-intensive businesses that create value through innovation and R&D while also protecting and rejuvenating our environment,” Cossar says. “We have strong interests in maintaining the space environment as a peaceful, safe, and sustainable domain.”

Other government-led sustainable space initiatives include its LeoLabs partnership and participation in MethaneSAT, New Zealand’s first government-funded space mission. The mission aims to measure and track global methane emissions and find ways to reduce these emissions to help combat climate change.

“Space could be a much larger, higher-value industry for New Zealand. It could help us transfer away from being a primary producer toward a producer of high tech for the world,” says Powell. “We can do it while maintaining ourselves as a clean and green country. This is a domain where we can make a big difference because aerospace is certainly not the cleanest and greenest industry out there — and there’s a lot we can do to improve it. It's a niche that works really well for New Zealand.” VS

Rina Diane Caballar is a freelance journalist based in Wellington, New Zealand.