Thank you, Mr. Chair.
Thank you to the committee for the opportunity to speak today about the impact of Canada's defence industrial strategy and the efforts to develop a Canadian sovereign launch capability.
Before I begin, I want to acknowledge the Algonquin Anishinabe as the traditional stewards of this land.
My name is Hugh Kolias, and I am chief executive officer of the Canada Rocket Company. We are a Canadian owned and controlled company developing medium-lift launch capability in Canada. We are also one of three companies on today's panel that have received funding through the innovation for defence excellence and security—or IDEaS—program's launch the north initiative. In short, this initiative aims to accelerate the development of sovereign launch in Canada.
I want to start by emphasizing how grateful we are that the Government of Canada has launched this initiative. We are an example of how the defence industrial strategy is working. The public signalling and initial funding from the launch the north initiative have acted as a significant catalyst. To date, every single public dollar invested in the Canada Rocket Company has attracted nearly two dollars of private capital. This demonstrates that strategic government signals unlock private markets.
We believe that the best use of public contributions is to be multiplied by private investment. In just six months since incorporation, we have raised $22.8 million in total capital, $14.5 million in private investment, including from the BDC, and an $8.3 million non-dilutive grant through IDEaS. We have attracted over 20 experienced engineers from around the world, many of whom are Canadians repatriating back. These engineers have all worked at global launch and technology companies such as SpaceX, Blue Origin, ArianeGroup, Rocket Lab and Tesla.
I provide these examples to you today to demonstrate the real-world impact of the defence industrial strategy. It would not be possible to attract the engineers and private capital or move at the speed we are without the signalling and support from the Government of Canada.
The global space economy is expected to be $1.8 trillion by 2035. Our world runs on satellites. GPS-dependent systems underpin over 20% of our GDP from global financial networks, logistics, telecommunications, power grids, weather forecasting and defence coordination. Access to space is critical infrastructure.
Canada currently depends on our allies to place Canadian payloads into orbit. The current commercial launch market is dominated by one actor, SpaceX, which launched over 84% of payload mass to orbit in 2024. China is a distant second. There is a multi-year backlog for launch capacity globally, and the cost over the last few years has risen by at least 30%.
The current IDEaS launch the north framework is an exceptional first step, focused on establishing tactical, light-lift capabilities; however, to truly secure our sovereignty and economic future, Canada must look towards medium-lift capability.
The medium-lift launch market, classified as between 2,000 to 20,000 kilograms of payload to orbit, held over 56% of the commercial market in 2024 and is expected to be up to $20 billion in the mid-2030s. Medium-lift capability, especially on the higher end of payload delivery, is limited to a few global players and represents a substantial national security and economic opportunity for Canada to capture. To scale from the foundation laid by the IDEaS program to a fully operational medium-lift capability, we require three strategic commitments from the Government of Canada.
The first is to anchor demand. The government must become an early customer by committing to contract domestic launch capacity for future Canadian civil and military payloads. Underwriting first flights, exactly as NASA did in the early 2000s, is the single most effective way to crowd in the private capital required.
Second is continued co-investment in development. We need continued, cost-shared, milestone-based funding models that match private capital investments through the next phases of test, qualification and flight.
Third is regulatory alignment. Streamlined launch licensing, expedited permitting and appropriate export-control treatment for a Canadian sovereign launch program are necessary to make this viable at the pace that the strategic environment requires.
To quote Brigadier-General Christopher Horner, commander of the 3 Canadian Space Division, who spoke at the Space Canada Horizons conference last month, “The strategic question before us is no longer whether space matters.... The strategic question is, will Canada possess the freedom of action required to protect its sovereignty, security, and economic prosperity of the future?”
Canada has a narrow window to establish this capability. The talent exists. The private capital is available. The government investment to date is already producing results. The question before this committee is this. How do we continue to accelerate policy and investment?
Thank you very much, Mr. Chair. I'd be happy to answer any questions committee members may have.