Parabolic trough solar collectors at Arizona Public Service Company's Saguaro power plant.

Solar's Getting Competitive

February / March 2008 By: Mark Mehos Volume 6 Number 1

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Imagine a utility-scale power plant technology that helps mitigate climate change, uses sunlight as a fuel source, creates high-quality local jobs and economic growth, improves national security, reduces dependence on foreign energy sources and provides a hedge against fossil fuel price increases. Sound too good to be true?

Not according to research at the National Renewable Energy Laboratory. Concentrating solar power, or CSP, plants generate electricity without the fuel costs or emissions of traditional power plants, and NREL is attempting to optimize both the technology and the economics.

Conventional power plants burn fossil fuels to produce high-temperature steam or gas to drive a turbine, which drives a generator to produce electricity. CSP systems use the same principle, except that the sun is the heat source. There are three main types of CSP systems.

A dish/engine system uses a mirrored parabolic-shaped dish to collect and concentrate sunlight onto a receiver, which absorbs the heat and transfers it to a working gas within the engine. The heat causes the gas to expand against a piston or turbine to produce mechanical power, and the mechanical power runs a generator or alternator to produce electricity.

A power tower system uses a large field of mirrors to concentrate sunlight onto a receiver on top of a tower, heating a working fluid—€”either molten salt or water/steam—€”that flows through the receiver. A conventional steam generator uses the heat from the working fluid to generate electricity.

Parabolic trough systems concentrate the sun's energy onto a receiver pipe using parabolically curved, trough-shaped reflectors. The sun heats oil flowing through the pipe, which boils water in a conventional steam generator to produce electricity. Both trough and tower systems can store energy collected in the field in large tanks filled with molten salt, allowing them to operate through cloudy conditions and into the evening.

Parabolic trough systems are likely to be the dominant commercial CSP technology for the next five to ten years, but the other technologies will move into the marketplace as they demonstrate improved cost and performance.

A number of factors are driving interest in CSP. Increases in fossil energy prices make a power plant with no fuel costs very attractive. Climate change concerns favor a technology that emits few or no greenhouse gases. Many states mandate a certain percentage of renewable energy installations through renewable electricity standards (RESs), and federal, state and local governments offer a variety of financial incentives to support the use of clean energy technologies.
But parabolic trough CSP installations are nothing new. The largest group of solar systems in the world are the parabolic trough plants in the Mojave Desert in southern California. Built between 1985 and 1991, the plants are still operating, have a total capacity of 354 megawatts and have performed well.

More recently, the first commercial CSP plant in Arizona came online in December 2005 and generates enough electricity to power about 200 homes. On a much larger scale, the 64 megawatt Solar One—„ project near Boulder City, Nev., came online in June 2007 and generates enough electricity to power about 14,000 homes. For both new projects, NREL used its Video Scanning Hartmann Optical Test, or VSHOT, to help the developer, Acciona Solar Power (formerly Solargenix Energy) test the accuracy of the mirror shape and alignment and ensure that reflected sunlight hits the receiver tube.

Both projects use the advanced collector design developed by Acciona under an NREL contract. This collector has an innovative aluminum hub system to create a structure that is 30 percent lighter, has 50 percent fewer parts and requires substantially fewer fasteners than earlier designs. The end result is a 15 percent increase in collector performance and a 15 percent decrease in investment costs, which—€”combined with improvements in component reliability—€”net an improvement of about 35 percent in total cost effectiveness.

NREL's support for CSP goes beyond technological improvements, and includes developing solar resource data and maps that help identify prime areas for future CSP development. In addition, an NREL report demonstrates that investing in CSP power plants delivers greater return in both economic activity and employment than corresponding investment in natural gas equipment.

The southwestern United States has an enormous solar resource, and geographical information system screening analysis shows that there is plenty of suitable land to support large-scale CSP deployment. Fortunately, much of this land also is close to existing transmission infrastructure, minimizing the cost of accessing these high-value solar resources.

The Western Governors' Association Clean and Diversified Energy Solar Task Force indicates that 4 gigawatts of concentrating solar power plants could be installed in the southwest United States by 2015 with federal and state policy support. Preliminary results using the model developed by NREL indicate that up to 30 gigawatts of CSP could be installed by 2030 if the current federal solar investment tax credit is extended. That figure could more than double if state or federal carbon policies limit deployment of conventional fossil-fired generation.

The Department of Energy's goal for CSP is to compete with natural gas combined-cycle systems in intermediate load markets by 2015. DOE is also considering a goal of making CSP competitive in baseload power markets. It is unlikely that CSP can compete in the long term with conventional coal-fired plants, but it should eventually be competitive with integrated gasification combined-cycle coal with carbon capture and storage.

In spite of all the benefits of generating electricity with CSP, the technology faces obstacles as it moves toward full commercialization. Perhaps the biggest barrier is inconsistent financial incentives. The current 30 percent federal incentive is set to expire at the end of 2008. The industry is pushing hard for an 8-year extension of the tax credit (through 2016), but previously the credit was extended for only two years.

This creates serious problems in the process of developing a CSP project. Although construction takes only 12 to 18 months, the entire process—€”negotiating a power purchase agreement, closing financing, obtaining permits, etc.—€”takes 3 to 4 years. Uncertainty about the federal incentive can make financing very difficult to obtain. This reality makes continued research and development very important to reduce cost and hence dependence on state and federal incentives.
Congress has increased the CSP budget to $30 million in fiscal year 2008. With the budget restored and an active industry seriously developing projects, the laboratory plans to focus its efforts on improving CSP's prospects in the United States.

For example, NREL intends to work with state and federal stakeholders to reduce the barriers to near-term deployment. Reducing the cost of thermal storage is also important and will allow CSP to be competitive in current intermediate load markets as well as future baseload markets by enabling CSP facilities to provide electricity when the sun is not shining.

NREL expects that state RESs will continue to drive a substantial amount of renewable energy development. Both Arizona and Nevada, where the two most recent CSP projects have been built, have renewable electricity standards in place, as do California, New Mexico, Colorado and Texas. Other state incentives such as production tax credits, property tax exemptions and sales tax exemptions can further improve the economics of renewable energy projects.

Mark Mehos is the program manager for CSP research and development at NREL.

This work has been authored by an employee of the Midwest Research Institute under Contract No. DE-AC36-99GO10337 with the U.S. Department of Energy. The United States Government retains and the publisher, by accepting the article for publication, acknowledges that the United States Government retains a non-exclusive, paid-up, irrevocable, worldwide license to publish or reproduce the published form of this work, or allow others to do so, for United States Government purposes.