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The resolution adopted at the agency's interministerial summit in Seville, Spain on Monday will see European companies compete for a contract to deliver a commercial cargo service to carry supplies to the ISS and bring cargo back to Earth, ESA said in a news release.
It said the plan would ensure ESA regained its commercial position, reduce dependence on taxpayers and make it an "anchor customer and enabler of commercial space activities and services."
With funding for the initial stages secured, ESA said private investment was being sought through the competitive process. However, it sought to skirt around the fact a decision regarding the second phase was put off until the next funding round meeting in 2025.
"By taking a decision at today's Space Summit, ESA can start work immediately to meet the ambitious 2028 milestone," ESA said.
"The Ariane 6 and Vega-C launchers will soon guarantee European access to space, but the launcher market paradigm has changed radically. Europe must maintain the technical and industrial capacity for uninterrupted access to space."
However, the initial state funding package for the ambitious plan agreed by ministers was just $80 million.
That compares with NASA's $790 million funding for companies to develop commercial cargo capabilities for NASA to piggy on back in 2005 which eventually led to SpaceX's Dragon cargo shuttle servicing the ISS in 2012 and Northrop Grumman's Cygnus a year later.
The meager funding appropriation reflects a split on how ambitious the bloc should be when it comes to investing big in space exploration with the enthusiasm of France, Spain, Italy and Belgium reined in by a Germany wary of the cost and the fact that France, which dominates the sector in Europe, stands to be the biggest beneficiary.
Germany's preference is for the Bremen-built European Service Module, part of the NASA-led Artemis program to return humans to the moon, according to German aerospace coordinator Anna Christmann, who chaired the meeting.
She urged space companies bidding for the ESA cargo shuttle contract to look to private investors to strengthen their bids.
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