A few years ago, when a polysilicon shortage suddenly drove up the price of photovoltaic panels, solar thermal was all the rage.
Start-ups were emerging every week, introducing new super-concentrating mirror technologies, special reflective films and other innovations.
Companies began announcing plans for utility-scale solar thermal plants anywhere there was sun in the United States. Solar thermal, also called concentrating solar power (CSP), not only had a cost advantage over photovoltaics, it offered one thing PV never could: storage, and thus stability.
So where did all the solar thermal go?
While there have been a few highly publicized bouts between large-scale solar thermal proponents and conservation groups concerned about the land required to build such plants, the real issue comes down to simple economics. Back when there was private capital available to fund projects like giant solar plants in the desert, the technology was still new and relatively untested. Now, just as the technology has matured, private capital has dried up with the recession.
Federal stimulus money has provided some grants and loan guarantees, but by all accounts the government just can’t afford to be the only funder of large-scale solar thermal plants. Moreover, the silicon glut is long gone, and PV is now the better option for utilities looking to get renewable energy into their portfolios cheaply and quickly.
Elsewhere in the world, CSP is still the technology of choice for large-scale solar, according to Jayesh Goyal, North American sales director for French utility Areva, which recently acquired Silicon Valley solar thermal start-up Ausra Solar.
The key for the U.S. market is to bring down the cost of the equipment, its installation and its operation and maintenance.
"For awhile there was a lot of development down the path of very customized solutions—lots of complicated lenses and materials," said Sumeet Jain, a principal with CMEA Capital, a longtime investor in solar technology. "That means more expense—and maybe higher performance—but definitely at a lot of expense."
Now companies are leveraging more off-the-shelf components, Jain said. “Solar thermal projects, for example, might go with a standard boiler or opt for flat mirrors instead of custom, curved glass.”
Such choices make it easier to get financing, because companies are using tested, proven components, Jain added. It also makes it easier to partner with manufacturers to get better deals on parts and drive down the overall cost of a project.
A number of solar thermal companies are working on the cost problem, each finding new ways to make the economics more attractive to American utilities.
There are three primary CSP designs on the market today: solar towers, parabolic troughs and linear-Fresnel systems — and proponents of each have a rivalry similar to that between PV and thin film. Engineers can wax poetic for hours on the differences between the three, but the fact is that all CSP systems work in essentially the same way: Reflective surfaces with tracking systems are used to concentrate heat from the sun into a receiver filled with a heat-conducting fluid. It is then transferred to an engine that converts the heat to electricity.
In parabolic trough systems, each trough has its own receiver, while linear-Fresnel systems feature several rows of mirrors that point to a single receiver. In tower systems, thousands of tracking mirrors in a field capture and reflect sunlight to a central receiver atop a tower. Each technology has been touted as the most efficient, stable, cost-effective choice in the solar thermal repertoire. So far, linear-Fresnel — the technology used by Ausra Solar — has been dominating the market.
However, the parabolic trough team recently has made some advances in cost reductions. Colorado-based SkyFuel, for example, is set this year to commercialize its SkyTrough, a product the company estimates uses 30 percent fewer materials, 40 percent fewer parts and requires half the assembly time of the average solar thermal system. Those numbers are backed by a report on SkyTrough published by the National Renewable Energy Laboratory. Honolulu-based Sopogy sells what it calls a MicroCSP parabolic trough system that allows for the affordable, quick installation of smaller solar-generating plants, in the 2MW range.
The company’s systems can be installed in half the time it takes to install other systems, according to Sopogy representatives, and don’t require electricians or specialized installers, which reduces installation costs by 60 to 80 percent.
Sopogy’s greatest innovation, however, may be its marketing strategy: All CSP systems can operate at lower temperatures to fulfill a variety of demands beyond simply generating power. Sopogy has targeted that broader market, selling its system as a device with many applications — from power generation to cooling to drying.
In its first installation, a 2MW thermal energy plant in Hawaii, Sopogy is generating power on the grid; the next phase will help power a small desalination plant. In a rooftop installation at Sempra Energy in San Diego, Sopogy’s system is running the building’s air conditioning system.
"They’re getting free air conditioning from the sun," Darren Kimura, Sopogy’s founder, said at this week’s Intersolar Conference in San Francisco. "It’s solar-augmented cooling. That makes the building more energy efficient. In that instance, we don’t necessarily think of the system as solar technology. It’s an energy conservation technology."
While individual companies are making incremental improvements to CSP technology, until the cost is lower than that of photovoltaics, utilities are likely to continue to embrace PV. To overcome the bias, secure customers and acquire project financing, Goyal says companies need to be ready to back performance claims with their balance sheets.
That’s something most start-ups can’t do, which is why many of them are partnering with larger industrial partners. According to Goyal, that was the case when Areva acquired Ausra; similar acquisitions are happening throughout the industry, most notably Siemens’ acquisition of Israeli CSP company Solel last year.
"You need to be able to offer utilities a credible performance guarantee. This is the reason that half the large-scale CSP projects announced have failed," Goyal told Intersolar conference participants this week. “Because what is behind that guarantee? If you’re a start-up, and you guarantee the performance of your technology and it fails, you’ll just go out of business. That’s not a guarantee."
To deal with utilities’ hesitation and price concerns, Goyal says Areva’s strategy of building so-called "booster" projects at existing plants—smaller CSP installations that take some of the load off an existing power plant—have been successful. The booster plants help reduce emissions and increase a utility’s comfort level with CSP.
Still, he said, utilities are never likely to choose CSP over PV simply because of the storage and stability advantages of the technology.
"At the end of the day, you have to be able to benchmark your offering against not only the lowest-cost solar offering, but the lowest-cost renewable. But, even though utilities have a preference for PV because it’s cheaper, smaller, and easy to deploy rapidly so they can meet their RPS [Renewable Portfolio Standard] requirements, they all say that if CSP can match the cost of PV, they have a preference for CSP.”
That holds true in Europe, where feed-in tariffs and government subsidies make the two comparable, and utilities show a heavy preference for CSP. Analysts and experts are confident that day will come in the United States as well. The U.S. Department of Energy has predicted a 13 percent growth in the CSP market over the next 20 years, and a total installed U.S. capacity of 20GW by 2020.
In other words, the sun isn’t ready to set on solar thermal.
(Photo: Courtesy BrightSource Energy)