The race for the lead in concentratingsolarpower (CSP) development accelerated in recent weeks with major advances from SolarReserve, BrightSource Energy and Abengoa, the three primary contenders. Each advance moves solar power plant technology closer to its future.
BrightSource Energy (BSE) got final California Public Utilities Commission (CPUC) approval of revised twenty-year power purchase agreements (PPAs) with Southern California Edison (SCE) (NYSE:EIX) for a 250-megawatt power tower project at its Rio Mesa site and for a 250-megawatt tower project at its Sonoran West site with two hours of storage capacity.
BSE will deploy its next-generation technology at Rio Mesa, scheduled to go into service in 2015. Sonoran West, scheduled for completion in 2016, will be BSE‘s first use of its steam-heated molten salts storage system.
Spain’s Abengoa (PINK:ABGOY) began construction on two South African CSP projects. Both Khi Solar, a 50-megawatt power-tower project with two hours of storage, and KaXu Solar One, a 100-megawatt parabolic trough project with three hours of storage, won long-term PPAs from South Africa’s publicly owned Eskom utility in competitive bidding. Both are expected to be operational in 2016.
SolarReserve secured PPAs with Eskom for its Letsatsi and Lesedi 75-megawatt photovoltaic (PV) projects and its 88-megawatt Jasper PV project. PV is not SolarReserve’s first priority. But at its current low price, “photovoltaics have traction,” SolarReserve CEO Kevin Smith said. “There is a demand and we are responding to the demand.”
“In our hearts, we view CSP with storage as the long-term solution,” Smith said, “but we are a development company. We have been looking at PV for a number of years. Sometimes technology is site-specific and sometimes it is market-specific. South Africa, Saudi Arabia, Chile and the Western U.S. are very good for towers with storage, but those markets are going to build PV, too. We are in both.”
To bid in South Africa, Smith explained, development had to be “pretty much complete,” with fully permitted sites, the interconnection and ancillary requirements in place, twelve months of solar resource site studies done, and debt and equity commitments approved.”
Abengoa had “a bit of a head-start,” Smith said. “We weren’t quite ready with CSP so we bid our PV projects. They are a bit easier to permit.” But SolarReserve’s 100-megawatt Redstone CSP project with storage is now fully permitted and will be bid in the May 2013 round, Smith added.
Smith wanted to talk about the CSP technology race. He discounted Abengoa’s trough technology because, he said, it cannot get its therminol fluid heated above “about 750 degrees Fahrenheit (F).”
The molten salts used by all three technologies to store heat solidify at just below 500 degrees F, Smith explained. Power towers get their fluids, compressed steam for BSE and molten salts for SolarReserve, to over 1000 degrees F, allowing almost twice the heat to be transferred for storage.
“Our direct competitor is BrightSource Energy,” Smith said, and he believes SolarReserve’s Pratt &Whitney-Rocketdyne technology is ahead.
“Our project with storage is in construction and will be in commercial operation next year. BSE is transitioning their technology and have a ways to go until they have a storage solution. It is a work in progress. They won’t start construction until 2014 or 2015. We have a technology that exists.”
BSE has repeatedly said it is following its own roadmap, though its timeline matches Smith’s claims and SolarReserve’s 110-megawatt Crescent Dunes project, which will have ten hours of storage, remains on schedule in northern Nevada. It has a twenty-year PPA with Nevada Power with a publicly announced PPA rate of $0.135 per kilowatt-hour.
“We have four U.S. projects in development,” Smith said. “The 150-megawatt Crossroads project in Arizona will soon receive its final permits.” It also has a transmission interconnection, though not a PPA. “We would like to begin construction by the end of 2014.” Quartzite, SolarReserve’s second Arizona project, “is in late-stage permitting. We hope to get the final permits by mid-2013.”
The Saguache Project, two 100-megawatt Colorado power tower units, is also fully permitted. “We are in discussions with power off-takers but don’t yet have PPAs.”
The 150 megawatt Rice power tower project in Southern California, with a PPA from Pacific Gas and Electric (PG&E) “is our next project. It should be in construction by the end of 2013,” Smith said. “It will have 7.5 hours of storage. For us, that amount of storage will be easy,” he added, but for BSE “7.5 hours of storage using a direct steam system is very expensive.”
BSE uses solar-heated compressed steam to drive a turbine. For storage, it will use the steam to heat molten salts. SolarReserve uses the sun to directly heat molten salts. Both will release the stored, heated salts to create steam that, even in the absence of sun, can drive the plant turbine and generate electricity.
BSE has frequently expressed reluctance to participate in a public tit-for-tat about the technologies’ merits but Smith was unhesitating. “Steam is the wrong thing to use to heat salt. You should be using the sun’s energy to heat salt. A steam to molten salt heat exchanger is not very cost effective or efficient. They go from steam to salt and back to steam. Why would you do that?”