Aching to return to space, NASA scientists and engineers were filled with more dreams than just the first flight of the Space Shuttle. One immediate idea for a Shuttle mission is to reuse Skylab, which was last crewed in 1974.
A few contractors aided in devising a special spacecraft with one mission: Dock with Skylab and boost it into a higher orbit using the Teleoperator Retrieval System, or TRS.
Based on some studies, NASA felt comfortable that Skylab would remain in orbit for about nine years, or around 1982.
After the boost, using the TRS, developed by Martin Marietta, later Shuttle crews would fold the forward two solar wings on the ATM to allow clearance for the Shuttle to dock, using a special docking extension interface for provisioning.
Later missions would refill the station’s thruster control gas tanks and install a truss with an ISS-like solar panel. Since the refurbished Skylab could be used at other angles, a plan to fully replace the long-lost micrometeoroid shield with a new shield, fully wrapped around the vehicle, was developed.
Additional modules, very similar to ISS designs in size and shape, would also be interconnected.
But while one element of NASA supported the idea, others in the agency weren’t fully committed and the boost and refurbishment mission never moved beyond the proposal stage. As Shuttle development delays pushed forward, suggestions to launch the TRS using a Titan III were submitted, and declined.
To some, Skylab would’ve held NASA back, who had grander aspirations in building a much larger and versatile space station using the Shuttle. Space journalist and former NASA Shuttle flight controller James Oberg wrote an insightful article on the subject. He notes:
“The proposal finally died. There had been no obvious oversights, just a creeping conspiracy of circumstances that left a problem with no real solution. Besides, NASA hall great hopes for a future beyond Skylab, one that included more advanced stations constructed from three or four space shuttle loads deployed in the 1980s. For some, Skylab’s continued existence threatened those plans. ‘There was considerable resistance within NASA,” says Martin Marietta’s Molloy.’ “The enthusiasts were those who had worked on Skylab and were quite proud of it, but it interfered with the more global vision of glory shared by the later generation at NASA.” Given a risky cheap way and an expensive fancy way, NASA (not for the first or last time) opted for spending a lot of money in the future rather than a little money immediately.”
Sadly, NASA’s data on Skylab’s orbit was inaccurate due to unforeseen solar activity that created greater drag on the workshop. The vehicle tumbled into the atmosphere 2 years before the Shuttle was ready, in July 1979.
There is also a great illustrated article on such plans by David S. F. Portree.
You can read one of the reuse studies from NASA.