Interview with José Manuel Suarez and Marco Antonio Carrascosa.
Reported from CSPPLAZA: When it comes to solar thermal power industry, people cannot avoid mentioning one name, Spain. Recently, this country has occupied a unique position and leading the development of CSP technology across the world, but much to surprise, its cruical role suddenly began to fall around 2012. What about the current situation of Spanish CSP market now? What are these companies engaged in? Is there any chance that the former CSP “Empire” rises up again? CSPPLAZA journalist interviwed with two experts from Spain, they are José Manuel Suarez (General Manager of IM Energy) and Marco Antonio Carrascosa (CTO of Tewer).
Both of them have been in CSP industry for more than ten years and participated in the Crescent Dunes CSP project. In a word, just like other Spanish experts involved in this industry for many years, they witness the rise and fall of Spain solar thermal power career, and now they want to set foot in Chinese market, what’s their opinion and suggestions for Chinese first batch of demonstration projects?
CSPPLAZA: What’s the current situation of Spanish CSP market? What are the differences between now and before 2012? Is there any chance that the development of CSP plants will restart? And what are those previous suppliers doing right now?
José Manuel Suarez: After the first 40 projects constructed some years ago, there is no new station process opened by the Spain government. Now, many companies start to return this market. Considering the Spanish market started in with first solar thermal generation plant being put in operation ten years ago, about 2006 or 2007, and the last plant was in operation in 2012. During the last eight years, many Spanish companies are involved in the development and improvement of this technology, such as increase the efficiency. But they just trend to turn other markets with good solar radiation, like Morocco and South Africa to continue their technology development. China is a good opportunity for us all to develop CSP technology.
Figure: José Manuel Suarez (General Manager of IM Energy)
Marco Antonio Carrascosa: I think the Spanish market is not as hopeful as before, however, many Spanish companies take a lot of experience in engineering, construction and operation of CSP plants. In other words, most of them have sufficient capacities to develope this kind of market. It’s a pity that the rules from Spanish government don’t let us go ahead within the territory of our country. And the potential to reduce the cost of generating electricity with CSP technology is very high. Compared to international companies, Spanish companies have more background in cost and technology and then we are certainly more competitive. And now, apart from taking part in European markets, we strive to find cooperation with new partners in other places.
José Manuel Suarez: When it comes to restart CSP plants in the local places in Spain, we´ll be there, but we will see whether there is any chance to build plants in Spain in the future, which depends on the regulation of the governments.
CSPPLAZA: From the point of view of technology innovation driving down costs, what is the innovation direction of parabolic trough and tower CSP technologies? Which one do you think has bigger space in innovating and reducing costs?
Marco Antonio Carrascosa: I think there are mainly two ways to reduce the cost of tower technology, one is new developments and the other is to make the market larger size. And the first way is possible because we have reduced the cost of solar field by 25% compared to Tonopah reference. As for parabolic trough projects, I think it’s exactly the same, which means we need to enlarge the sizes of the plants and switch from thermal oil as HTF to molten salt in the solar field. In a word, it’s necessary to combine market size and technology development, in my opinion.
Figure: Marco Antonio Carrascosa (CTO of Tewer)
José Manuel Suarez: I agree with Marco that it’s crucial for us to enlarge the market size when we expect to innovate these technologies, because we still have many lessons to learn, more R&D and lots of programs that need to be done. Besides, hybridization is a main concern that we should try to integrate more other kinds of new energy generation ways with CSP technology together.
CSPPLAZA: Where do you think is the most potential CSP market across the world? Why?
José Manuel Suarez: It depends on several factors. The first one is the DNI irradiation. Only places with proper DNI solar resources have the advantage to develop solar thermal power projects. The second one is the necessity and potential of the country grid to absorbe electricity. To combine other technologies with CSP is a better way and the CSP plant with molten salt storage system is a manageable way, meaning that you can produce under demand. And the politicians should give some help for the development of the CSP technologies. Therefore, the relative supportive policies in investment released by the government are also a factor that usually makes a difference.
CSPPLAZA: How do you think of China’s thermal power generation market?
Marco Antonio Carrascosa: I think China CSP market is growing very fast. Although the solar irradiation here is not the best in the world, it’s enough to apply CSP technology to generate electricity. Considering the dispatchability of electricity, solar thermal power plants combine well with other renewable technologies. Hybridation is a solution delivering lower cost of energy and better dispatchability. And we’d like to reduce the cost of this kind of technology even though it’s really a tough challenge for us.
CSPPLAZA: About one month ago, China government finally released the list of first batch of CSP demonstration projects and clearly stipulated that only projects which are completed by the end of 2018 can enjoy the FIT policy of RMB1.15/kWh, what’s your opinion about this rule and is it hard or fine for these project owners?
José Manuel Suarez: When you want to make a bit for technology, Chinese market is a good example for you to carry on. Second, the feed-in-tariff policy should be good enough for the current situation of CSP technologies. The third issue is the legislation on deadline given by most governments, which also happened in Spain, U.S. and South of Africa. It’s normal and for project owners, there is no time to lose. And it means 2 years and 4 months for China demonstration project owners.
Marco Antonio Carrascosa: From my point of view, the timeframe is very narrow and time is short, which I think is a great opportunity and challenge for China project owners. And the feed-in-tariff is good but not very high because the DNI value here is not as high as it is in some special places across the world.
José Manuel Suarez: Well, in my opinion, I think the feed-in-tariff is good enough in view of improvement of this technology during these years; in the other hand, CSP technology has developed for about ten years. So what people need to do is to take advantage of all the knowledge accumulated in the past.
Marco Antonio Carrascosa: Now that the time is short, I advice that it would be helpful if some pilot project owners can introduce some new technologies from international companies. Indeed, I think the government should give more flexibility for these projects. Because the target is to complete these pilot projects with high cost competitiveness, if they are not allowed to build plants with enough time, then the final target is difficult to fulfil at the end.
CSPPLAZA: Based on your prediction, how many demonstration projects can be successfully put into operation within the deadline?
José Manuel Suarez: I wonder what if these pilot projects would not be finished before the deadline; will Chinese government release a new FIT policy for them or give more time for owners to complete their plants? Personally, I think most of them will finalize the goal eventually but they need more time.
Marco Antonio Carrascosa: As far as I can see, I think with the current technology level, capabilities of engineering and support from some experienced international companies, many owners can develop their projects more smoothly. However, based on the realistic situation where time is short, I am affraid that there is little time for basic engineering or other works, so unlike Mr.Suarez, I believe that part of them will have difficulties to reach the goal by the end of 2018 finally. If I have to say a number of it, maybe 70%~75% of these projects can be put in operation within the deadline.
José Manuel Suarez: And to be honest, it’s not easy for all for owners to achieve the goal, even for them who have been involved in CSP industry for many years. But anyhow, if there is a market where the industrial capability of a country is able to face that kind of challenge, I believe it is China. And there is no other country worldwide.
CSPPLAZA: what do you think these project owners should do to make more project successfully operated?
Marco Antonio Carrascosa: without a doubt, there are a large number of Chinese CSP companies having been involved in this careerfor many years, and most of them achieved a lot. However, if we want more pilot projects to be successfully put into operation under this feed-in-tariff, I recommend that these Chinese companies should cooperate with some partners who have experience in design, engineering, construction, operation and maintenance from overseas. And besides, I think it would be beneficial if they can introduce and apply so many advanced technologies as they can, so that these pilot projects can be more meaningful in enlarging the market size.
José Manuel Suarez: To summarize, obviously, Chinese have built many other kinds of generating plants so far, including nuclear power and wind power plants. But in CSP technology, most of them are not so familiar with molten salt storage system and solar field. So I advise these project owner, should import the successful or failed lessons learnedfrom overseas to ensure these plants be operated more smoothly.
CSPPLAZA: Many overseas engineering consulting companies hope to participate in the development of China solar-thermal power generation demonstration project, but they usually quote very high, which definitely brings larger pressure for these demonstration project owners under the condition of current electricity price. And to some extent, this almost become a contradiction in the process of chinese-foreign cooperation, what do you think both Chiese and overseas partner should do to promote cooperation between each other?
José Manuel Suarez: First of all, I think we should be clear enough what we want. For our company, we want to be part of China CSP market, build business relationship with Chinese companies and earn money, so we can make certain that everything will be at a reasonable price. So the relationship between China companies and us are balanced. Now that many markets have been taken up by local companies in China CSP industry, technical consulting, EPCM and some other servicesare the one that overseas companies like us can play a role, Therefore, try to find the common interests is a key step. And we think we know how to find the common space.
Marco Antonio Carrascosa: As we all know, China is a potential CSP market, and what we expect is to provide as much support as we can for this market under a more competitive price. We are a knowledge company which goes wherever the market is growing. And our final goal is to offer our collaboration and technology to support projects to achieve the target. That will not be a problem for us.
CSPPLZA: What kind of business will you promote to China market？
Marco Antonio Carrascosa: Hopefully, we want to be a part of solar power of China. We can provide technology and solutions for complete solar field in Tower and parabolic trough plants, including the area of assemblies, canting and manufacturing, detail engineering, control, commissioning, and management and quality control support.
José Manuel Suarez: We are familiar with the purchase, construction and commissioning of many CSP projects; it means, all the parts of the projects. Our delegator will participate in highlighting all those issues that are needed to be considered in a more specific way due to the CSP application. We can support the technical key points, including everything which is related to the salts, power block and solar field. Our strategy is not to participate as a foreign company not considering the specific site for these projects. We are totally convinced this formula will not work at all in China. This is why we will cooperate with other companies incorporating a large local content in order to adapt our product and services to the specific necessities and capabilities of the Chinese market. In this area, the participation of our partner AEI, which has previous successfully experiences in China, is essential.
CSPPLZA: I know that both of you have taken part in the development of Crescent Dunes project, so we have just written an article about the electrical performance. Many people especially in China are not satisfied with the result. What do you think of the phenomenon? Is it normal？
José Manuel Suarez: There is more than one year that I do not visit the site of Crescent Dunes project; despite we were involved in the construction and operation of the project. The information that I know in this moment is that the plant runs with day by day paces, but it is not able to reach the maximal production during large periods. It means that they initially need to get the target. What I have known is that they have some issues with operation. The answer to the question can only be given by Solar Reserve, because they own the plant, and they probably know exactly why they do not reach the production rate right now.
I am sure that the plant will grow up the electricity production and all of the equipment can produce power to get the production model.
Question: Kevin Smith, CEO of Solar Reserve Kevin Smith, made us a speech in our annual conference this June, and he told the audience that Crescent Dunes project still needs one year as the transmission period to reach the production model. So what is your attitude towards his words?
José Manuel Suarez: I agree with his opinion and once we participated in the first projects for parabolic trough and tower with molten saltsworldwide, we can agree up to certain point; all famous plants still needs more time to achieve the anticipated production. So it’s normal that Solar Reserve needs time to solve some questions of the operation and has to learn which is best way to operate the plant. We´ll see in one year when you can compare the data progress from two consecutive months.
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