SolFocus Inc. said Thursday it has completed its first commercial project, installing 500 kilowatts worth of concentrating-solar equipment in Spain.

The installation, which consists of two power plants, is part of a 3-megawatt installation that seven companies are building at the Institute of Concentration Photovoltaic Systems, also known by its Spanish acronym, ISFOC, in Puertollano.

It's a milestone for the Mountain View, Calif.-based company, which won a contract for the project in 2006 and broke ground in 2007, and for the technology, which has delivered few commercial plants.

In July, SolFocus announced it had completed a 200-kilowatt power plant and said it planned to build a second plant, with the capacity to produce 300 kilowatts of power, in August (see SolFocus Installs Concentrating-Solar Project in Spain).

"Not long ago, we were looking at three trackers in a field and saying 'Wow, we're making progress,' " said Nancy Hartsoch, vice president of marketing. "Now we're at half a megawatt. And next year we're talking about 15 to 20 megawatts, so we're [growing fast]."

The company is the first of three – including Isofoton and Concentrix – to complete its part of the first phase of the project, expected to have a capacity of 1.7 megawatts. In November, ISFOC awarded contracts for the second phase of the project, expected to have a capacity of 1.3 megawatts, to Sol3g, Concentración Solar La Mancha, Emcore Corp. and Arima Eco.

Now, the company is ready to raise more capital, ramp up its production capacity and hopes to soon announce another project - this one in California, Hartsoch said.

SolFocus, a Palo Alto Research Center spinoff, uses small lenses and curved mirrors to concentrate sunlight and direct it into solar cells. In 2006, the company claimed its technology would enable it to cut the installed price of solar in half, to less than $4 per watt, and still make a healthy margin (read more about the technology here and here).

Hartsoch said she couldn't talk about the current cost – the company also has previously declined to disclose the terms of its agreement with ISFOC – but said the company expects to sell systems at about the same price per watt as traditional flat-plate solar panels next year and as much as 10 percent below that price by the end of the year. 

Its panels are most competitive in areas with a lot of direct sunlight, where traditional panels might not cope as well with the heat, she said.

The company also expects to be competitive with conventional energy sources around 2012, she said.

"At one time we were more bullish and thought could get there sooner – and if oil prices go up, maybe we can - but the [U.S. Department of Energy] wants everybody to get there by 2015 and we think that's very doable," she said. 

SolFocus previously planned to reach full commercialization, with 100 megawatts of capacity, in 2007.

The company now expects to reach that capacity by the end of next year, Hartsoch said. While she wasn't sure of the company's current production rate, she said it would be "a big ramp."

"Our biggest task in the next year will be to ramp up manufacturing," she said.

To that end, the company is raising $60 million to $80 million in a third round of funding, she said, confirming a VentureWire report in June (see Earth2Tech post).

SolFocus is looking at a number of different sources - not just venture capital - for the round, which it expects to close by the end of the year, Hartsoch said. Most of the money is slated to increase manufacturing, with some also geared toward business expansion, she said.

The company already has raised significant cash. It announced in November it had closed $11.6 million, bringing its total capital to $95.6 million (see SolFocus Snags More Cash and Cleantech Deal Roundup).

SolFocus also earlier this week announced that its panels were the first concentrating-solar PV panels eligible to participate in California's solar incentive program, meaning they had met the state energy commission's safety and reliability standards.

Does that mean the company is targeting California next?

Yes. Hartsoch said SolFocus hopes to announce a deal in California - involving a hot desert site - in the next week or two, and added that the project would aim for installation in the second quarter of next year.

Meanwhile, the company also expects its Spanish installation to be switched on and connected to the grid in the next two weeks, she said.

In initial tests, the panels have proven they can each produce the expected 205 watts of power, she said. In some cases, they are producing 10 to 15 percent more power than their rated amount, but most are producing nearly exactly what the company promised, she said.

"It's exciting to pull this off a volume manufacturing line and see that kind of consistency," she said.

Pedro Banda, ISFOC's director general, confirmed the initial results are promising.

"While we are just now beginning to evaluate performance results from the installed systems, initial results look excellent and validate our belief that the high-efficiency capability of [concentrating] PV technology is going to provide high energy yields," he said in a written statement. "SolFocus has done an excellent job of progressing its technology from [research and development] into commercially ready product."

Aside from the Spanish project, SolFocus has installed 7.2 kilowatts of panels at a radio transmitter near Fremont, Calif., and also has small installations at six test sites.

SolFocus also has been working on a second-generation technology that shrinks the concentrator into a glass tile that could further reduce costs. But Hartsoch said that technology is at least three years from commercialization.

In the meantime, the company is working on an updated version of its current technology that will be more efficient and easier to manufacture, she said.