Many experts believed that solar thermal power markets would become much stronger by 2020.
One expert offered a very optimistic prognosis: “We could see 50–70 GW of CSP worldwide by 2020, which could include 5 GW in Spain, 5 GW in the rest of Europe (especially Turkey), 20 GW in the U.S., 30 GW in the Middle East/North Africa (especially Morocco), 5 GW in India, and possibly 5 GW in China.”
Another was even more optimistic: “The global CSP market could reach 25–50 GW/year by 2020 if some major companies enter the market, and even 50–100 GW/year is not unreasonable.”
Greenpeace (2012) shows over 2,000 GW of CSP by 2050. CSP power costs are cited as 19–29 cents/kWh by REN21 (2012). There are many divergent claims over the current “real” costs of CSP in today’s markets, by industry, experts, and regulators, which hinders understanding of how far CSP costs have to fall before becoming competitive.
Other industry estimates in 2011–2012 showed current costs as low as 10 cents/kWh for new projects. Cost ranges given by scenarios are 7–11 cents/kWh by 2030 (IEA ETP, 2012), 11–23 cents/kWh by 2035 (IEA, WEO 2010), and 6–10 cents/kWh in the long term (Greenpeace, 2012).
The IEA WEO (2010) offered the following prognosis of solar CSP economics: “Further technology improvements and cost reductions are important, especially in the mirrors/reflectors, which account for around 20–40% of the overall capital costs, depending on the plant design.
Power tower technologies are considered to have significant potential in this respect, with potential cost reductions for the heliostat on the order of a factor of two to three. Even more fundamental to the economics of CSP is increasing its availability, through the integration of storage (e.g., molten salt).
While this significantly increases the upfront investment costs … it can be more than offset by the value of the increased hours of operation per day.”
CSP technology faces decades of evolution and offers many possible areas of cost reduction, according to experts. Most were optimistic that CSP will have a prominent place in energy systems of the future, and that development trends of the previous five years are only the beginning of a strong decade through 2020.
One expert gave this long-term prognosis: “CSP development will probably remain policy dependent through 2025 or 2030, depending on natural gas prices. After that, it will enter a competitive period with steep learning curves, and by 2050 will be installed at rapid rates reminiscent of natural gas turbines in the 1980s and 1990s. These time frames could be accelerated if natural gas prices rise steeply or become more volatile, such that fuel price risk becomes a major factor.”
The IEA ETP (2010) “Technology Roadmap” envisions continued innovation in CSP though 2020, and then envisions a number of specific innovations during 2020–2030, including higher working temperatures (higher efficiency), larger storage capacities, supercritical plants, desalination by co-generation, and tower plants with air receivers and gas turbines. The roadmap envisions networks of HVDC transmission lines to bring CSP power from remote areas, and increased policy support and incentives as costs become closer to competitive.
Beyond 2030, incentives may no longer be needed, and solar CSP storage makes major contributions to balancing power grids. The roadmap concludes that, “in the sunniest countries, CSP can be expected to become a competitive source of bulk power in peak and intermediate loads by 2020, and of base-load power by 2025 to 2030.”
But CSP also faces headwinds, according to experts, including: (1) cheaper competing solar PV costs if CSP storage and other attributes are discounted; (2) land and water use (although hybrid dry/wet cooling can be used in areas with limited water resources); and (3) transmission access in remote desert regions.
In particular, there was much disagreement about the future competitiveness of CSP versus solar PV. CSP plants can offer many hours of energy storage that solar PV cannot, and this was frequently cited as a key asset for CSP plants, relative to solar PV.
With enough storage, a CSP plant can offer all the capabilities of a conventional generator, providing firm dispatchable power, as well as grid balancing, spinning reserve, and ancillary services, but with even greater flexibility than a conventional fossil fuel or nuclear plant.
Experts stressed that part of CSP technology evolution will take the form of novel applications, some of which are emerging already.
Such applications include: (1) managing grid variability and providing peak power using thermal energy storage embedded within the CSP plant; (2) dedicated CSP plants powering desalination plants in coastal areas; (3) embedded CSP plants in industrial facilities to provide power and industrial process heat; (4) pre-heating feed-water for a coal power plant to reduce coal consumption; (4) integration with combined-cycle natural gas plants (already occurring); and (5) producing gas or liquid fuels including hydrogen.