The huge increase in this year's budget request for ACSC is the result of an internal struggle at NASA, a person familiar with the situation told CNBC on Monday. This year's launch of a competitive bidding process means that companies build their own spacecraft with the help of NASA's sponsorship awards rather than just building a NASA-specific spacecraft.
NASA did not respond to CNBC requests for comments.  Following the creation of the National Space Council, Donald Trump's Presidency sought to work with the growing private space sector in several NASA programs. One of the main instructions was to create a permanent US presence on the moon. NASA first sent robots without crew to the surface, later followed astronauts.
Recently appointed NASA administrator Jim Bridenstine backed the White House plan last year to make ACSC a competitive process between companies, CNBC said. However, some NASA leaders rejected the idea because they wanted to stick to the development of an in-house lunar lander project, one of the participants said.
Known as the "Flexible Lunar Explorer" (or FLEx) concept, some at NASA wanted a system built for the agency, rather than the companies that build the spacecraft. This is NASA's traditional procurement method, such as Boeing's Space Launch System (SLS), which is now years old and is costing billions of dollars in costs.
With delays in the SLS program, privately-built missiles are increasingly being considered to launch NASA missions. Despite internal hesitation, NASA is now considering commercial alternatives to bring astronauts to the surface of the moon. The agency has been talking with companies about "allowing regular access to the lunar surface," NASA said in its budget proposal earlier this month.
The increased funds for ACSC also fit with remarks that Vice President Mike Pence had made on Tuesday at a National Space Council meeting. Pence said it was the White House policy to "bring American astronauts to the moon within the next five years." Although he said the SLS rocket needed to be sped up, he urged NASA to reach the moon "by all means necessary."
"We are not committed to a single contractor, and if our current contractors can not do so objectively, then we will find those who will do so," Pence said. "If American industry can provide critical commercial services without government development, then we buy them."
Musk welcomed Pence's comments and said in a tweet, "It would be so inspiring for humanity to see humanity return to the moon!"