A provision in the conferenced fiscal year 2016 defense authorization bill bans the Air Force from spending money on new launch vehicles in favor of a new rocket engine in its rocket propulsion system program.

“We have an engine problem,” a congressional source told Defense Daily. “We have a Russian engine we want to get rid of, let’s build a U.S. engine and try to leverage this existing infrastructure and launch vehicles.”

Aerojet Rocketdyne currently provides rocket engines used in United Launch Alliance's Atlas V launch vehicles. Photo: ULA.
Aerojet Rocketdyne currently provides rocket engines used in United Launch Alliance’s Atlas V launch vehicles. Photo: ULA.

Section 1606 says funds authorized in the FY ’15 National Defense Authorization Act (NDAA) for the rocket propulsion system may only be used for the integration of the of the rocket propulsion system with an existing or new launch vehicle and may not be used to develop or procure a new launch vehicle or related infrastructure.

The bill could be interpreted as a win for Aerojet Rocketdyne [AJRD] and a loss for United Launch Alliance (ULA), which Aerojet Rocketdyne currently provides engines for use in launch vehicles. Aerojet Rocketdyne has been proposing its AR-1 engine be used as a plug-and-play replacement for the Russian developed RD-180 that the Air Force’s propulsion program is looking to replace by 2019.

ULA, on the other hand, is developing a new launch vehicle called Vulcan as its proposed solution for national security space launches that must be off the RD-180 beyond 2019 . The two companies have developed a bitter rivalry since a rumored Aerojet Rocketdyne bid for ULA was reported in September.

“If companies want to go create new launch vehicles and create new infrastructure and things like that, that’s fine, we’re all for that,” the congressional source said. “What we’re saying is this may not be used to develop a new launch vehicle or infrastructure, that’s not what the government funds are for.”

Another provision titled “streamlined acquisition” directs the Air Force to use tailored documentation and review processes that enable the efficient, effective and expedient transition from the use of non-allied, or Russian, engines to a domestic alternative. It also directs the service to establish well-defined requirements with a clear acquisition strategy. The congressional sources said this was an attempt to give the Air Force the authority to go outside the “normal” acquisition process, as long as they had a “clear acquisition approach and requirements.”

Like ULA, Aerojet Rocketdyne has a major presence in Alabama, which is represented by Richard Shelby (R), Senate Appropriations Committee (SAC) chairman. Alabama is also represented by House Armed Services (HASC) chairman Michael Rogers (R), who publicly declared in a June hearing how he wanted the Air Force to fix the Russian engine issue (Defense Daily, June 26).

“I want a new engine, I don’t want a new rocket,” Rogers said. “We want something replace the RD-180 and, if not be a drop-in fit on the Atlas V, something that doesn’t require a whole lot of modifications to work on the Atlas V.”

An industry source said Tuesday that Alabama’s congressional delegation clearly ranks Aerojet Rocketdyne above ULA, which is a Lockheed Martin– [LMT] Boeing [BA] joint venture. ULA spokesman Jessica Rye said the company is reviewing the proposed legislation.

The Air Force in June announced it could award as many as four contracts totaling $160 million as part of its next-generation rocket propulsion system program (Defense Daily, June 3).