Use the sun's heat to cool a room. It sounds like a contradiction, but Peter Le Lievre says solar air conditioners could become a key element for relieving stress on the grid during peak periods.

And grow into a multibillion dollar business at the same time.

Le Lievre, a co-founder and former CEO of solar thermal specialist Ausra, has formed a new company – Chromasun – that hopes to capitalize on the small, but growing market for multifunctional solar systems (see All-in-One Solar Panels and Solar Thermal). The company has erected a working prototype in San Jose, Calif. and is currently raising money to build larger prototypes that will be installed in the U.S. and overseas. By the first quarter of next year, he wants to be in mass production.

Multifunctional solar devices harvest both light and heat from the sun. Traditional PV cells only harvest light and are only around 23 percent efficient in converting photos to electric power. Solar thermal systems collect heat, and are about 48 percent efficient at best. Utility-scale solar thermal systems are closer to 20 percent efficient because the captured heat gets converted to electricity.

Chromasun's device is 75 percent efficient. The device – at 10 foot by 4 foot sealed box – is essentially a utility scale solar thermal plant and a utility-scale concentrating solar PV plant in miniature. It contains mirrors, receivers and a concentrator for generating solar thermal energy as well as silicon solar cells.

The heat – roughly 65 percent of the power generated – gets exploited to run the air conditioners while the PV-generated electricity is used locally to offset grid power. Because there are spaces between the mirrors, sunlight can be used to light the interior below. Smaller devices will later come out for the residential market.

"We are generating electricity but we are also using all of the waste heat," he said.

Others in the market include BrightPhase Energy (light, electricity, heat), Entech Solar (electricity, heat), Skyline Solar and Millennium Solar (see Can You Go Cheaper Than First Solar?). A few other stealth companies, one backed by former Intel execs, are on the way.

Unlike many of the other companies, however, Chromasun will largely target itself as an air conditioner company  and in fact is already in discussions with two of the largest heating and air conditioning (HVAC) contractors in the country.

Why? Air conditioners are some of the biggest energy hogs out there. HVAC systems gobble up 16 percent of the energy in the U.S. (Building operations account for around 39 percent of U.S. power according to the Department of Energy and 40 percent of that power goes to HVAC). Worse, air conditioners move into high gear on the hot afternoons when power costs the most and is the most difficult to find. It's no coincidence that blackouts occur on hot summer days.

Fifty percent of the demand for power during peak periods in California and 70 percent of the power in Dubai can be attributed to air conditioners, he said.

"Ninety-five percent of that can be tackled by a solar thermal air conditioner on the roof," he said. "The biggest market is for peak AC."

Chromasun is geographically challenged. The device works best in the U.S. southwest, North Africa, Western Australia and Southern Europe.

"In dry hot it's good. Humid hot is not so good," he said. Still, these regions account for $28 billion of the $70 billion annual AC market.

Payback can occur in two to four years, assuming 18 cents a kilowatt hour for peak power. An electrical air conditioner can cost $27.69 an hour to run while a natural gas one can cost $21.63 an hour. The equivalent cost for a solar conditioners, which still need pumps and other devices, is $15.52. A 1,200 square meters worth of rooftops outfitted with these devices can put out 700 kilowatts of heat.

"The thermal side makes all the money," Le Lievre noted.

Chromasun's system works the same was as natural gas double-effect chillers. Water or an oil in a sealed tube gets heated to 220 degrees Celsius. The heat is then used to warm a solution that contains a refrigerant. The refrigerant boils away. The solution and refrigerant are later reunited, exploited to cool and room, and pumped through another heating and cooling cycle.

Multifunction devices also symbiotically eliminate some of the costs of mono-functional devices. On the PV side of things, Chromasun's device uses 95 percent less silicon than a conventional solar system with the same power rating. The reduction comes because of the Fresnel concentrator that is put in for the thermal system. (The solar cells are located on the underside of the solar thermal collector.) Performing two functions also reduces the cost that has hampered widespread acceptance of concentrating PV.

Meanwhile, the solar thermal system requires little maintenance and can be operated with mirrors measuring 0.3 millimeters thick. Like a utility-scale solar thermal plant, the mirrors tilt with the sun.

It also does not need to be connected to the grid and the heat does not have to be converted into electricity, two of the big expenses with solar thermal power plants.

"[The mirrors] are like gossamer," he said. "There is no rain, no wind, no dirt. It is a sealed box."

Join industry leaders and influencers at Surviving the Shakeout: Greentech Media’s 2009 Solar Industry Summit in Phoenix, Ariz., April 14–15.