Cost Risk Analysis for NASA's Ares I Launch Vehicle Program
Smart, C.¹; Stone-Towns, B.²; Hunt, C.^3
1Management Consulting and Research; ²Marshall Space Flight Center; ³NASA Headquarters

NASA's Constellation program represents the agency's first new manned space launch vehicle in a generation. Estimating program costs accurately is critical for making informed policy decisions. Cost estimates contain numerous sources of uncertainty, including (among other factors) uncertainties in launch vehicle design, many aspects of which will be refined throughout the design process. NASA considers uncertainty in its cost estimates for Ares, and employs sophisticated statistical techniques to represent cost estimates as probability distributions. Risk analysis is critical in the current budget environment due to direction from the NASA Administrator that all NASA programs must be funded at 70% confidence level, with Constellation funded at the 65% confidence level.

The Ares I launch vehicle is a combination of heritage hardware and clean sheet design. The Ares I launch vehicle has stringent design requirements to support man's return to the moon, as well as to support International Space Station. The Ares I launch vehicle consists of a first stage solid rocket motor, and an upper stage that will be fueled by a liquid rocket engine. (The Orion manned capsule will ride on top of the launch vehicle.) The upper stage is an in-house NASA design that will be produced by one or more hardware contractors. Both the J-2X upper stage engine and first stage Reusable Solid Rocket Booster (RSRB) draw upon NASA's experience with Saturn and Shuttle programs. This mixed bag of elements introduces challenges in risk assessment. A primary obstacle in estimating nonrecurring cost is the assessment of technical risk for high heritage and existing hardware that will be used in a new configuration. A significant hurdle in estimating recurring cost is the low production rate planned for the program. In order to meet the challenges, new and innovative techniques were developed for cost risk analysis. The development and application of these techniques for the Ares I launch vehicle are discussed in detail, including the use of rate curves to apportion recurring production costs into fixed and variable categories for each element.