ARENA announced on Wednesday it would contribute $1million to the study, with $1.2 million to come from Alinta and a further $123,000 from the state government.

The Australian Renewable Energy Agency has finally come to an agreement with the privately-owned Alinta to co-fund a feasibility study into a solar thermal power station to augment or replace the existing coal fired generators in the South Australian township of Port Augusta.

However, the study would not conclude until 2016, which may dash hopes for an earlier start to the project and a near-term replacement for the ageing Playford and Northern coal-fired power stations. Alinta recently said it wanted to extend the life of its two coal fired power stations for another two decades.

Solar thermal, including with molten salt storage, is emerging as an exciting new renewable energy option. Abengoa this year opened a 280MW parabolic trough and storage facility in California and recently announced it will build a 110MW solar power tower plant with 17.5 hours storage in Chile. It has begun construction of a 50MW project in South Africa.

BrightSource Energy is preparing to open its 377MW Ivanpah solar tower project in California, the largest in the world, while Solar Reserve is nearing completion of its 110MW solar tower project with storage in Nevada.

In Australia, the only major solar thermal project is a 44MW solar thermal booster to the Kogan Creek power station in Queensland, currently under construction. Howvr, the Clean Energy Financ Corporation last year said it would support a 24MW solar thermal project in Port Augusta to provide heat and power to a giant greenhouse.

There has been a major push by the local community and green energy groups for solar thermal generation in Port Augusta. Earlier attempts at reaching agreement for a study failed last year when Alinta said it would walk away from the idea after failing to get funding. However, ARENA said at the time it did not consider the matter closed.

ARENA CEO Ivor Frischknecht said in a statement on Wednesday the feasibility study would provide an exciting opportunity to progress solar thermal in Australia.

“Tapping into our plentiful solar resources will ensure renewables are well placed to contribute to electricity generation in Australia,” he said.

“This latest partnership is an important step in our renewables journey – it complements existing solar thermal projects in Australia and will help create a framework of research, development and demonstration.”

Frischknecht said the study would look into hybridised and standalone solar thermal power generation options for Port Augusta.

“Many of our coal fired power stations are nearing the end of their life cycle, presenting a clear opportunity for renewable hybrid options,” Frischknecht said. “This timely study in South Australia will include a full feasibility stage exploring plant design, site and technical details.”

There have been other studies of hybridisation, but industry sources have told RenewEconomy that this can be difficult and costly when done with old power plants. Kogan Creek is relatively modern.

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